Fundamental Changes of the 2006 PRC Securities Law

The recent amendments to the PRC Securities Law issued on 27 October 2005 and effective on 1 January 2006, revise a stunning 40% of the original provisions and involves amendments to more than 100 articles. The New Securities Law is the first major amendment since 1998 and aims to enhance the development of the Chinese securities and capital market by increasing significantly provisions relating to protection of investors’ rights, improve corporate governance and penalties for various violations.

This short summary intends to provide an overview of these significant changes by highlighting some of the differences between the Old Securities Law and the New Securities Law.