Securities Supervision Commission: Strictly regulate the reduction of major shareholders

On May 24th, the "Measures for the Administration of Reduction of Holdings" strictly regulates the reduction of holdings by major shareholders. It is clear that the controlling shareholder and the actual controller shall not reduce their holdings through centralized bidding transactions or block trade in the case of breaking, breaking the net, and not meeting the dividend standards; increase the pre-disclosure obligations of major shareholders before reducing their holdings through block trade; require the concerted action of major shareholders and major shareholders to jointly abide by the reduction restrictions. The second is to effectively prevent detours and reductions. Require the transferee of the agreed transfer to lock in for six months; clarify that all parties will continue to abide by the reduction restrictions after the stock is divided due to divorce, dissolution, division, etc.; clarify that judicial enforcement, pledge margin financing and securities lending default disposal, etc. shall apply the relevant reduction requirements according to the different reduction methods; prohibit major shareholders from selling or participating in derivatives transactions with the company's stocks as the subject matter; prohibit the conversion of restricted shares to lending and the sale of restricted shares. The third is to refine the provisions of liability for violations. It is clear that measures can be taken to order the repurchase and pay the price difference to the listed company for illegal reduction, and list the specific circumstances that should be punished. In addition, the obligations of the secretary of the listed company and the board of directors are also strengthened.