GF 323
CONFIDENTIAL
20
XXXXXXX
rather shallow, and the institutional
Some important shortcomings
including the following:
aspects are weak.
remain to be addressed,
(a) The total number of local enterprises in China which are constituted as jont-stock companies is only around 4 000 at present. Progress in the transformation of state-owned enterprises into a
share-ownership structure has been very slow.
(b)
(c)
(a)
highly
skewed.
are held by the
The shareholding structure is
About 86% of all the shares state, by legal persons, and by internal staff. But the legal person shares and internal staff
shares are not
to be traded in the two
main exchanges.
has given rise to black
allowed
This
markets(7), as well as occasional surges in speculative activities in the two main exchanges concerning the timing and terms of entry of these two categories of shares.
Chinese residents with foreign exchange balances are prohibited from holding B shares.
A
comprehensive and consistent regulatory framework for the securities sector, covering such aspects as accounting standards, disclosure
requirements, auditing, new listing, share
issuance and management of stock exchange, is
still lacking.
(7)
According to
staff shares
For example,
an estimate, about 90% of the internal were being traded in the black market. in Chengdu, at one time these shares were bought and sold openly and extensively in the street. To clamp down on such illegitimate trading, the government required that all the outstanding this category be registered, with non-tradeable and non-negotiable "stock right holding cards" issued as a result.
shares
in
CONFIDENTIAL
機密