The Securities Association of China ("SAC") has recently issued the Specification for Engagement of Securities Analysts in External Award Appraisal (the "Specification"), immediately effective from the date of issuance.
The Specification provides that securities companies shall exercise unified management of engagement of their analysts in award appraisal campaigns, and establish their internal control and accountability mechanisms to oversee the honest and self-disciplined performance of their analysts at each stage when they take part in award appraisal campaigns, so as to regulate analysts' involvement in such campaigns. Also, the Specification requires that analysts shall register for engagement in award appraisal campaigns through the securities companies in a unified manner, and securities companies shall restrict three groups of analysts that have received administrative punishment against their acts in breach of laws or regulations or are subject to administrative regulatory measures or self-disciplinary actions, from being registered as candidates in award appraisal campaigns. Analysts that have received administrative punishment imposed by the China Securities Regulatory Commission ("CSRC"), for example, shall not be recommended as candidates in award appraisal campaigns in the year of punishment and in two years thereafter. Moreover, the Specification highlights that securities companies and their analysts shall be strictly prohibited from publishing or disseminating any canvassing information in any form, including but not limited to posting on various self-media platforms, such as chat groups or moments on WeChat, or disseminating via email any canvassing information.