Stock Exchanges Tighten Rules on Trading Halts Ahead of MSCI Review

(Beijing) – The two bourses in Shanghai and Shenzhen announced rules restricting listed companies from temporarily halting trade with little warning to investors, a move that will increase the possibility of mainland stocks being included in an index compiled by MSCI Inc., a person close to the securities regulator said.

The two exchanges said in separate notices on May 27 that companies undertaking a major asset restructuring cannot suspend trading for more than three months and those conducting private placements can only stop trading for up to one month. If companies want to apply for a longer suspension, they are required to hold a board meeting to decide on the arrangement, the Shenzhen Stock Exchange said.