证券公司高级管理人员管理办法 Order of China Securities Regulatory Commission

and its detached office may issue a warning letter to or make a supervision talk with the SM directly liable or having leadership liability：

　　1. The securities company or the SM himself is suspected of violating laws， administrative regulations or the provisions of the CSRC；

　　2. There is major hidden trouble in the

corporate governance structure and internal control of the securities company；

　　3. The SM does not keep his promise； or

　　4. The financial indexes of the securities company do not comply with the risk monitoring indexes as prescribed by the CSRC.

　　Article 34 Where a securities company is subject to the disciplinary punishment by the Securities Association of China and the securities exchanges and other self-disciplinary organizations， or is subject to an administrative punishment by the administrative departments of taxation， audit or industry and commerce， it shall report in written form the reasons for the punishment and penalties and the list of names of the SMs who shall assume leadership liabilities to the detached office of the CSRC at the registration place within 10 workdays from the date of occurrence of such facts.

　　Article 35 In case any SM has any of the following circumstances， the CSRC may determine recognize him as an improper person：

　　1. Being issued warning letters or supervision talks having been made with him for three times accumulatively by the CSRC；

　　2. Having been subject to disciplinary punishments for three times accumulatively by self-disciplinary organizations；

　　3. Having leadership liability for the disciplinary punishment or administrative punishment imposed on the company for 5 times accumulatively；

　　4. There being evidences proving that he is lack of professional competency， and fails to do well the management work or goes against his commitment；

　　5. Failing to effectively implement the relevant systems concerning the corporate governance and the internal control；

　　6. Being absent without leave；

　　7. Being liable for the business risks occurred in the company or acts in violation of laws and regulations as showed in the audit report for leaving his post；

　　8. Authorizing any person who does not have the SM qualification or whose SM qualification is invalidated or any improper person elected to exercise power as his representative；

　　9. Determining the person who is to perform the duties as a representative in violation of the provision of Article 25 of the present Measures；

　　10. Concealing or failing to report acts in violation of laws and regulations or major business management liabilities of other SMs of the company；

　　11. Refusing to provide relevant supervision information to the CSRC or other circumstances under which he does not cooperate in the supervision； or

　　12. Violating the provision of Article 22 of the present Measures.

　　In case the CSRC plans to determine any relevant SM to be an improper person elected， it shall notify the company and the person himself before sending a letter of suggestion on improper person selected to the securities company. The SM may put forward written statement to appeal to the CSRC within 10 workdays as of the date of receiving the letter of suggestion.

　　Article 36 A securities company shall exempt the person selected from the post of an SM within 10 workdays from the date when it receives the letter of suggestion of the CSRC on determination that he is not proper， and shall report the removal in writing to the CSRC and its detached office at the registration place of the company within 15 workdays from the date of receiving the suggestion letter.

　　No securities companies may select or engage a person who is determined as an improper person selected by the CSRC to hold the post of an SM within two years after the determination.

　　Article 37 Where any SM is dismissed of his duty due to the invalidity of the SM qualification or being determined as an improper person selected， he shall cooperate with the company to complete the handover of work and accept the audit for leaving his post.

　　Article 38 Where the CSRC determines that a person recommended is an improper person selecte

d or the person is revoked or suspended of qualification for holding the post within one year from the date when the person making recommendation signs the recommendation opinions， the CSRC shall not accept the recommendation opinions of the person who makes the recommendation or the annual examination form signed with his opinions from the date when making the decision on revocation and suspension.

　　Article 39 Where any securities company violates the provisions of the present Measures， the CSRC shall charge the company to make rectification and correction. During the period of rectification and correction， the CSRC may suspend acceptance or examination of such application matters concerning the operation qualifications and newly established institutions of the company.

　　Article 40 The CSRC shall establish an SM database to record contents of the persons who have obtained the SM qualification such as the identity information， information on qualification for holding the post， practicing acts， conditions of law violation and discipline violation and etc……

　　The CSRC may throw daylight on the relevant information concerning the SMs by taking proper means.

　　Chapter V Legal Liability

　　Article 41 Where any SM of a securities company violates laws， administrative regulations and the provisions of the CSRC and shall be subject to the administrative punishment according to law， he shall be punished according to relevant provisions. In case he is suspected of committing a crime， he shall be transferred to the judicial organ and subject to criminal liability.

　　Article 42 Where any applicant applies for the SM qualification by concealing the relevant conditions or providing false materials， he shall be given warnings.

　　Where anyone obtains the SM qualification by cheating， bribery or other malfeasance means， he shall be revoked of the qualification for holding the post and be fined less than 30，000 Yuan.

　　Article 43 In case anyone has any of the following circumstances， he shall be ordered to make correction， and the company and the SM who is liable shall be given warnings singly or concurrently and be fined less than 30，000 Yuan. If the circumstances are serious， the relevant operation qualification of the company shall be suspended within 6 months， and the SM who is liable shall be given warnings， suspended or revoked of the SM qualification：

　　1. In the company occurs a greater business risk， major economic loss or occur major cases of financial crime；

　　2. Impairing the lawful rights and interests of customers；

　　3. Providing false information or concealing major matters c to the CSRC；

　　4. Failing to make rectification as required by the CSRC or the rectification is not effective；

　　5. Failing to perform duties of reporting and archival filing as required； or

　　6. Failing to make audit on SMs as required when they leave the post.

　　Article 44 Where anyone violates the provision of Article 22 of the present Measures， he shall be ordered to make correction， given warnings singly or concurrently， or fined less than 30，000 Yuan. If the circumstance is serious， his SM qualification shall be suspended or revoked.

　　Chapter VI Supplementary Provisions

　　Article 45 The persons who have obtained the SM qualification before the implementation of the present Measures shall apply for the SM qualification certificates within the time limit prescribed by the CSRC.

　　Article 46 The present Measures shall come into force as of November 15， 2004

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