Regulation of Information
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This chapter explores how information disclosure is regulated in China’s securities markets in relation to issuers and listed companies. It also deals with regulation of representations by financial intermediaries. Disclosure requirements under legislation, CSRC regulations, and exchange rules are also reviewed. Three major areas of non-compliance identified by the CSRC are then examined: non-compliance with profit forecast disclosure requirements; where information disclosure is not timely, accurate, and complete; and, related to party transactions, false statements, major omissions, or failure to disclose at all or in a timely fashion. The role played by stock analysts in China is discussed. The chapter makes a case that retail investors in China are heavily influenced by information they receive from financial intermediaries. The sector is largely self-regulated by the China Securities Association—the chapter discusses the reasons for this and critiques its adequacy, drawing some conclusions as to regulatory priorities within the CSRC.