January 9, 2006
CLPB exclusive! Wrong version of new Securities Law posted on line in China
Take a look at your copy of the new Securities Law: does it say in Art. 213 that in some circumstances acquirers can't vote shares in excess of 30% of the company's total outstanding shares? Then you've got the wrong version, even if it purports to be the final version passed by the National People's Congress Standing Committee last October.
Both Chinalawinfo.com and the Xihu Online Legal Bookstore site, both of which I regularly use and have always found reliable, have - remarkably - posted an inaccurate, pre-final version of the Securities Law. The differences between the inaccurate version and the genuine final version (see below for the link) are as follows:
- Art. 15: Does not contain at the end the words "listed companies may also not make non-public share issues" (上市公司也不得非公开发行新股)
- Art. 204: Does not contain the qualifier "unlawfully" (违法) before the term "traded securities" (买卖证券).
- Art. 213: In the section of the first sentence following the semicolon, speaks of stock that is "held" (持有), not "acquired" (收购), and there is no 30% rule (i.e., voting rights may not be exercised with respect to any of the stock in question).
I wonder how long it will take people to notice? These errors are more than just misplaced commas; someone could be in for a nasty surprise at some point.
I'm including links to sources for the correct version below.
- Right version
- Wrong version
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