SHANGHAI (Reuters) - Chinese stock exchanges on Friday published draft rules that would force a company to delist in the event of serious rule violations, as regulators step up efforts to discourage speculative trading.
The rules, published by the Shanghai and Shenzhen stock exchanges, came a week after China’s stock regulator said the bourses should bear more responsibility in delisting enforcement.
According to the draft rules, violations that could trigger a delisting include fraudulent initial public offerings, serious information distortion in financial disclosures and grave illegal activities in daily operations.
China set up a delisting mechanism in 2014, but tougher delisting rules are needed to keep the stock market healthy and protect small investors’ interests, the Shanghai Stock Exchange said in a statement on Friday.
Reporting by Samuel Shen and John Ruwitch; Editing by Robert Birsel