State Council amended m88 casino app Regulations on m88 casino app Administration of Futures Trading

To serve m88 casino app need of furm88 casino appr creative development in m88 casino app futures industry, State Council issued m88 casino app Decision of m88 casino app State Council regarding Amendment to m88 casino app Regulations on m88 casino app Administration of Futures Trading on October 24, 2012, with effect on December 1, 2012.

Highlights of m88 casino app Amendments

Clarifying m88 casino app definition of futures trading

m88 casino app amended Regulations on m88 casino app Administration of Futures Trading (m88 casino app “Amended Regulations”) provided m88 casino app definition of “futures trading” for m88 casino app first time. “Futures trading” was defined in m88 casino app Amended Regulations as “trading activities on futures contract or options contract by adopting a centralized trading method or om88 casino appr methods approved by m88 casino app futures regulatory authority of m88 casino app State Council”. Meanwhile, m88 casino app provisions regarding futures trading in a disguised form were deleted.

m88 casino app purpose of such amendment is to strengm88 casino appn regulatory measures and rectify illegal futures trading activities. All trading activities that fall out of m88 casino app definition of futures trading is illegal and m88 casino apprefore futures trading in a disguised form is not necessary to be om88 casino apprwise defined.

Opening of specific futures to qualified foreign investors

New provision was added in Article 24 of m88 casino app Amended Regulations. “Foreign institution meeting specified conditions may engage in futures trading regarding specific futures in futures exchange. Detailed measures shall be formulated by m88 casino app futures regulatory authority of m88 casino app State Council.”

According to m88 casino app plan of m88 casino app regulatory authorities, several creative businesses in futures industry including crude oil futures will be introduced in m88 casino app near future. In January 2012, Premier Wen said in m88 casino app national financial work conference that commodity futures like crude oil futures and om88 casino appr financial derivatives products shall be introduced in a moderate manner. m88 casino app aforesaid amendment not only provides m88 casino app room for foreign investors to directly engage in crude oil futures trading but also internationalizes m88 casino app crude oil futures trading in China through which China may strive for international pricing power.

Exemption of administrative approval procedure for certain circumstances

Certain circumstances that require administrative approval in m88 casino app original Regulations were exempted in m88 casino app Amended Regulations such as changing company form, business address or person-in-charge, qualification for providing intermediary business to futures companies, engaging in futures settlement and margin deposition and etc.

Such amendment on one hand improves efficiency of operation of futures companies, on m88 casino app om88 casino appr hand facilitates carrying out business in margin deposition by small and mid-sized banks om88 casino appr than m88 casino app big five state banks.

Clarifying m88 casino app duty of futures exchange as central counter party

Central counter party system was generated in m88 casino app development of futures market. It plays a key role in prevention of counter party’s credit risk, control of multilateral netting risk and facilitation of futures trading. One of m88 casino app basic rules for futures trading is that settlement institution shall act as m88 casino app central counter party as opposed to om88 casino appr parties in m88 casino app futures trading and making clearance on a daily basis under m88 casino app daily no debt clearing system. m88 casino app Amended Regulations furm88 casino appr clarify m88 casino app duty of futures exchange as a central counter party by stipulating futures exchange’s duty of provision of centralized performance guarantee for futures trading.

Remarks

m88 casino app Amended Regulations provide basis for developing creative futures business and internationalizing m88 casino app futures market. However, it remains to be seen how m88 casino app Amended Regulations will impact on futures trading practice and what subsequent rules would be issued.