Circular on Issuing the Code of Conduct of Practising Securities Analysts

Circular on Issuing the Code of Conduct of Practising Securities Analysts

Zhong Zheng Xie Fa [2012] No.139

June 9, 2012

All securities companies and securities investment advisory firms:

For the purpose of strengthening the self-regulatory management of securities analysts and fulfilling the relevant requirements of the Interim Provisions on the Issuance of Securities Research Reports, the China Securities Regulatory Commission (the CSRC) has formulated and now issues the Code of Conduct for Securities Analysts, which shall come into force as of September 1, 2012 and be complied with accordingly. The Code of Professional Ethics for Chinese Securities Analysts issued in 2005 shall be repealed at the same time.

Code of Conduct for Securities Analysts

Article 1 In order to regulate the practice of securities analysts, enhance the professional competence of securities analysts and safeguard an honourable professional image for securities analysts, this Code is hereby formulated in accordance with the relevant requirements of the laws and regulations, the Articles of Association of the Securities Association of China (the SAC) and the Interim Provisions on the Issuance of the Securities Research Reports (Announcement of the China Securities Regulatory Commission [2010] No. 28).

Article 2 The securities analysts mentioned in this Code refer to the persons who have signed an employment contract with a securities company or a securities investment advisory firm and registered with the SAC as securities analysts.

Article 3 The securities analysts shall conscientiously abide by the laws, regulations, relevant rules of the CSRC, self-regulation rules in the industry and the internal management system of the securities company or securities investment advisory firm for which they work, and standardize their professional practice.

Article 4 The securities analysts shall follow the practice principles of independence, objectivity, fairness, prudence, professionalism, and honesty and integrity.

Article 5 The securities analysts shall maintain their independence and not abandon their independent position because of unjust requirements from such interested parties as the other departments inside the company for which they are working, securities issuers, listed companies, fund management companies, assets management companies, etc.

Article 6 The securities analysts shall scrupulously abide by the principles of honesty and integrity with their research conclusions as the expression of their true meaning, and are not allowed to mislead investors by giving investment analysis advice that violates their true meaning.

Article 7 When the securities analysts produce and issue securities research reports, they shall conscientiously use legal and compliance information.
　　......