• SSE, SZSE answered questions re implementation rules on shareholders, directors, supervisors, and senior management of listed companies for shareholding reduction.
• Follows CHI CSRC July 2023 answered questions re division of shares.
• Also follows SSE, SZSE issued the implementation rules on 27 May 2017.

Clarifications

• If major shareholders/directors/supervisors/senior managers reduce shareholdings due to divorce, termination of legal person, unincorporated organization, firm division, both shares transferer and transferee shall comply with disclosure requirements of the rule.
• Combined shares of both parties would be used to determine as major shareholder.
• Shareholding reduction quota of major shareholders who reduce holdings by no more than 1% within any 90 consecutive natural days via centralized bidding transactions.
• Reduce holdings by no more than 2% within any 90 consecutive natural days through block transactions; both parties shall fulfill disclosure requirements in both cases.
• The shareholding reduced during the tenure of the director/supervisor/senior manager shall not exceed 25% of the total number of shares of the firm held by each of them.
• Before major shareholders allocate and transfer shares, the listed company shall urge both parties to agree on and disclose distribution plan for the reduction quota.
• If they fail to agree, each party shall determine and disclosure the subsequent quota.