To optimize the information disclosure system of publicly placed funds and concretely protect the rights and interests of investors, the China Securities Regulatory Commission (the “CSRC”) promulgated the Measures for the Administration of Information Disclosure by Publicly Placed Securities Investment Funds (the “Administrative Measures”) and relevant accommodating rules. The Administrative Measures went into effect on September 1, 2019 and are highlighted below.
1. Information disclosure obligors are required to disclose pursuant to the disclosure requirements
An information disclosure obligor shall, within the time limit as prescribed by the CSRC, disclose requisite information about the fund via media designated by the CSRC, such as the national newspapers and periodicals (the “Designated Periodicals”) and designated websites (the “Designated Websites”). The obligor shall ensure that investors can openly consult or copy the disclosed information in the times and ways as stipulated in the fund contract.
2. Information required for disclosure
(1) Provisions on the general content of information disclosure
The information about the fund that is required to be disclosed to the public includes the following: (1) the fund prospectus, (2) the fund contract, (3) the fund custodian agreement, (4) summary about the fund product, (5) notice for the public offering of fund shares, (6) the state of fund placement, (7) public announcements of the listing of fund shares, (8) the net value of fund assets and fund shares, (9) prices for fund purchases and redemptions, (10) periodical fund reports, including the annual report, half-year report and quarterly report (including the quarterly report on the fund’s asset portfolio), (11) interim reports, (12) resolutions of the fund shareholders’ meeting, (13) major personnel changes to the dedicated fund trust departments of the fund manager and the fund custodian, (14) litigation or arbitration involving the fund’s properties, management business or trust business, (15) public clarification notices, (16) liquidation reports, and (17) other information required by the CSRC.
(2) Disclosure of placement information
A fund manager shall, after the application for fund placement is approved by the CSRC and three days prior to the offering, make the fund share offering announcement, release an indicative announcement regarding the fund prospectus and the fund contract in the Designated Periodicals; the manager shall post the fund share offering announcement, the fund prospectus, the summary about fund product, the fund contract and the fund custodian agreement on the Designated Website. The fund custodian shall publish the fund contract and fund custodian agreement in the Designated Website at the same time.
(3) Disclosure of information on fund operations
Once a fund share is approved to be listed on a stock exchange, the fund manager shall, three working days before the listing, post a public announcement about the listing on the Designated Website and an indicative announcement of the same in the Designated Periodicals.
A fund manager shall disclose the information about the fund’s net asset value in accordance with the following requirements: (1) for a closed-end fund, the net asset value of the fund and the net asset value of the fund share shall be disclosed on the Designated Website at least once a week; (2) for an open-end fund, the net asset value of the fund share and the cumulative net asset value of the fund share shall be disclosed on the Designated Website at least once a week once the contract has entered into effect and before the purchase or redemption of the fund share; (3) in case of an open-ended fund, the net asset value of the fund share and the cumulative asset value of the fund share for each trading day shall be disclosed via the Designated Website, the website of the fund distribution institution or of the business outlets not later than the day after the trading day; and (4) the net asset value of the fund share and the cumulative net asset value of the fund share as of the last day of a half year and of the entire year shall be disclosed on the Designated Website no later than the day after the last day of the half year or of the entire year.
The fund manager shall also prepare the quarterly, semi-annual or annual report of the fund after the quarter, half year or year ends and publish the same on the Designated Websites and Designated Periodicals.
(4) Disclosure of interim information
When the fund is subject to any major incident that may have a significant impact on the rights of the fund’s shareholders or the price of the fund share, the information disclosure obligor is required to prepare an interim report in two days and post it on the Designated Periodicals and Designated Website.
3. Other requirements and accommodating documents
In addition, the Administrative Measures also cover information disclosure administration, supervision and legal liabilities. The CSRC has also promulgated the Provisions on Issues Relating to the Implementation of the Measures for the Administration of Information Disclosure by Publicly Placed Securities Investment Funds as the accommodating provisions to set out supplemental rules on the details of information disclosure by publicly placed funds.