Article 188: Any person that publicly offers securities or does so in a disguised manner without verification and approval by the statutory authority shall be ordered to cease the offering and refund the proceeds of the offer together with bank deposit interest for the same period, and fined not less than 1% and not more than 5% of the amount of the illegal offer proceeds. The company that is established by way of the unauthorized public offer or disguised public offer of securities shall be shut down by the authority or department performing regulatory duties in accordance with the law jointly with the local people's government at or above county level. The persons in charge that are directly responsible therefor and the other directly responsible persons shall be issued a warning and fined not less than Rmb 30,000 and not more than Rmb 300,000.
Article 189: Where an issuer that fails to meet the conditions of offering obtains by deceptive means verification and approval of an offer, a fine of not less than Rmb 300,000 and not more than Rmb 600,000 shall be imposed if the securities have not yet been issued. If the securities have already been issued, a fine of not less than 1% and not more than 5% of the amount of the illegal offer proceeds shall be imposed. The persons in charge that are directly responsible therefor and the other directly responsible persons shall be fined not less than Rmb 30,000 and not more than Rmb 300,000.
If the controlling shareholder or de facto controlling person of the issuer has instigated the issuer to conduct the illegal act specified in the preceding paragraph, it shall be subject to penalties in accordance with the provisions of the preceding paragraph.
Article 190: Where a securities company distributes or deals as an agent in securities that are publicly offered without verification and approval, it shall be ordered to cease the distribution or dealing, its illegal income shall be confiscated and a fine of not less than the amount of and not more than five times the illegal income shall be imposed. If there is no illegal income or the illegal income is less than Rmb 300,000, a fine of not less than Rmb 300,000 and not more than Rmb 600,000 shall be imposed. If it has caused losses to the investors, it shall bear the joint and several liability for compensation with the issuer. The persons in charge that are directly responsible therefor and other directly responsible persons shall be issued a warning, their employment qualifications or securities business qualifications shall be revoked, and they shall be fined not less than Rmb 30,000 and not more than Rmb 300,000.
Article 191: If a securities company has any of the following acts in distribution of securities, it shall be ordered to rectify the matter and issued a warning, its illegal income shall be confiscated and a fine of not less than Rmb 300,000 and not more than Rmb 600,000 shall be imposed. If the circumstances are serious, its relevant business licence shall be suspended or revoked. If it has caused losses to other securities distribution institutions or investors, it shall bear the liability for compensation according to law. The persons in charge that are directly responsible therefor and other directly responsible persons shall be issued a warning, and a fine of not less than Rmb 30,000 and not more than Rmb 300,000 may also be imposed. If the circumstances are serious, their employment qualifications or securities business qualifications shall be revoked:
carry out advertising or other publicity and promotional activities that are false or that mislead investors; solicit distribution business by means of unfair competition; or other acts in violation of the provisions on securities distribution business. Article 192: If a sponsor issues a sponsorship document that contains falsehoods, misleading statements or major omissions or fails to perform other statutory duties, it shall be ordered to rectify the matter and issued a warning, its business income shall be confiscated and a fine of not less than the amount of and not more than five times the business income shall be imposed. If the circumstances are serious, its relevant business licence shall be suspended or revoked. The persons in charge that are directly responsible therefor and other directly responsible persons shall be issued a warning and a fine of not less than Rmb 30,000 and not more than Rmb 300,000 shall be imposed. If the circumstances are serious, their employment qualifications or securities business qualifications shall be revoked.
Article 193: If an issuer, a listed company or other person with information disclosure obligations fails to disclose information according to regulations or if the disclosed information contains falsehoods, misleading statements or major omissions, it shall be ordered to carry out rectification, a warning shall be issued, and a fine of not less than Rmb 300,000 and not more than Rmb 600,000 shall be imposed. The persons in charge that are directly responsible therefor and other directly responsible persons shall be issued a warning and fined not less than Rmb 30,000 and not more than Rmb 300,000.
If an issuer, a listed company or other person with information disclosure obligations fails to submit a relevant report according to regulations or if a submitted report contains falsehoods, misleading statements or major omissions, it shall be ordered to carry out rectification, a warning shall be issued, and a fine of not less than Rmb 300,000 and not more than Rmb 600,000 shall be imposed. The persons in charge that are directly responsible therefor and other directly responsible persons shall be issued a warning and fined not less than Rmb 30,000 and not more than Rmb 300,000.
If the controlling shareholder or de facto controlling person of the issuer, listed company or other person with information disclosure obligations has instigated the issuer, the listed company or the person to carry out the illegal act specified in the two preceding paragraphs, it shall be subject to penalties in accordance with the provisions of the two preceding paragraphs.
Article 194: If an issuer or a listed company changes the usage of the proceeds of a public offer of securities without authorization, it shall be ordered to rectify the matter, and the persons in charge that are directly responsible therefor and other directly responsible persons shall be issued a warning and fined not less than Rmb 30,000 and not more than Rmb 300,000.
If the controlling shareholder or de facto controlling person of the issuer or listed company has instigated the issuer or listed company to carry out the illegal act specified in the preceding paragraph, the controlling shareholder or de facto controlling person shall be issued a warning and fined not less than Rmb 300,000 and not more than Rmb 600,000. The persons in charge that are directly responsible therefor and other directly responsible persons shall be subject to penalties in accordance with the provisions of the preceding paragraph.
Article 195: If a director, supervisor or senior management personnel of a listed company or a shareholder that holds more than 5% of the shares of the listed company deals in the shares of the company in violation of Article 47 hereof, a warning shall be issued and a fine of not less than Rmb 30,000 and not more than Rmb 100,000 may be imposed.
Article 196: If anyone illegally establishes a stock exchange, the people's government above the county level shall ban the exchange, confiscate its illegal income and impose a fine of not less than the amount of and not more than five times the illegal income. If there is no illegal income or the illegal income is less than Rmb 100,000, a fine of not less than Rmb 100,000 and not more than Rmb 500,000 shall be imposed. The persons in charge that are directly responsible therefor and other directly responsible persons shall be issued a warning and fined not less than Rmb 30,000 and not more than Rmb 300,000.
Article 197: If anyone, without approval, establishes a securities company or illegally operates securities business, the securities regulatory authority shall ban the company or business, confiscate the illegal income and impose a fine of not less than the amount of and not more than five times the illegal income. If there is no illegal income or the illegal income is less than Rmb 300,000, a fine of not less than Rmb 300,000 and not more than Rmb 600,000 shall be imposed. The persons in charge that are directly responsible therefor and other directly responsible persons shall be issued a warning and fined not less than Rmb 30,000 and not more than Rmb 300,000.
Article 198: If anyone violates the provisions hereof by employing any person without employment qualifications or securities business qualifications, the securities regulatory authority shall order rectification and issue a warning, and may also impose a fine of not less than Rmb 100,000 and not more than Rmb 300,000. The persons in charge that are directly responsible therefor shall be issued a warning and may also be fined not less than Rmb 30,000 and not more than Rmb 100,000.
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