(Effective Date:1996.12.31–Ineffective Date:)
Article 1 In order to strengthen the supervision and control on listed companies, standardize their operation, and safeguard the interests Article 2 These procedures are applicable to the limited stock companies listed on the Shanghai Stock Exchange or the Shenzhen Stock Exchange. Article 3 The China Securities Regulatory Commission (hereinafter referred as the CSRC) is responsible for the implementation of these procedures. Article 4 Checks on the listed companies mainly cover: (1) Whether the release of the companies’ information meets the requests of the laws, rules and regulations as wall as the regulations (2) Whether the funds raised are used for the purposes as stated in the original prospectus for rallying or rationing shares; whether (3) Whether the articles of association are conformed with laws, rules and regulations as well as the regulations and standardized (4) Whether the meetings of share holders have been convened in accordance with the provisions of the laws, rules, regulations and (5) How meetings of the companies’ board of directors are held; how the legal functions and powers of boards of directors and chairmen (6) How the legal functions and powers of the companies’ supervision commissions are exercised; the composition of the supervision (7) How the duties and powers of the general managers (managers) and other senior managerial persons are carried out; scopes of the (8) The institution of the posts of secretaries for the companies’ boards of directors; scopes of the secretaries’ duties and power; (9) Other affairs which the CSRC thinks necessary to be checked. Article 5 The checks shall be organized by the CSRC. The CSRC shall draw and unite, according to needs, personnel concerned from local securities administrative departments, accountant Article 6 A listed company being checked shall help but not refuse the checking and persons being checked shall report the situation accurately Article 7 When checking a listed company, the checking personnel concerned may take notes, make audio or video records, take pictures and make Article 8 For a check, the checking personnel concerned shall show their I.D. cards and the certificates issued by the CSRC. Article 9 The companies being checked and related accountant offices shall mainly provide the inspection personnel with the following documents: (1) The companies’ accounting statements, related account books and certificates as well as other data being involved in the accounting (2) Records and resolutions of the meetings of share holders, records and resolutions of the meetings of boards of directors, records (3) The data and documents concerning the important investment; (4) Original copies of the auditing on financial statements of the companies formulated by the accountant offices; (5) Other documents necessary to be checked. Article 10 Checking personnel shall conscientiously carry out the work of checking in line with laws and rules as well as regulations concerned. Before results of the checks are announced, both the checking personnel and the companies checked must not release any information Article 11 Companies to be checked shall be decided by the CSRC on a sampling basis. Article 12 Time to make the checks shall be decided and acknowledged to the companies to be checked by the CSRC. Article 13 Should violation of laws, rules and related regulations by listed companies and responsible persons concerned be found through the Article 14 If a document issued by an accountant office or lawyer office violates rules and regulations concerned, the CSRC shall, within its Article 15 The CSRC shall be responsible for interpreting these procedures. Article 16 These procedures shall become effective as of the day when they are promulgated.
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