The China Securities Regulatory Commission (CSRC) has
published information on Futures and Derivatives Law.
The information on the CSRC website is currently in Chinese
only.
https://www.csrc.gov.cn/csrc/c100028/c7632835/content.shtml
Below is the translated version of the content:
To implement the requirements set out in the State Council’s
Opinions on Strengthening Regulation, Preventing Risks, and Promoting the
High-Quality Development of the Capital Market (Guofa [2024] No. 10,
hereinafter referred to as the “Opinions”), and to carry out the provisions of
the Futures and Derivatives Law of the People's Republic of China (hereinafter
referred to as the “Futures and Derivatives Law”), the China Securities
Regulatory Commission (CSRC), based on a summary of practical experience, has formulated
the Administrative Measures for the Supervision and Administration of
Derivatives Trading (Trial) (hereinafter referred to as the “Measures”).
The “Measures” represent the first departmental regulation
governing the derivatives industry under the CSRC. They further clarify the
primary institutional rules of the derivatives market and are of great
significance for regulating derivatives trading activities, preventing risks in
the derivatives market, promoting its steady, healthy, and orderly development,
and protecting the lawful rights and interests of traders. They are also
conducive to further leveraging the positive role of derivatives trading in
risk management, resource allocation, and serving the real economy.
The derivatives trading referred to in the “Measures” means
trading activities other than futures trading, including swaps, forwards,
non-standardized option contracts, and combinations thereof. The Futures and
Derivatives Law has brought derivatives trading within the scope of legal
regulation and authorizes the CSRC to formulate specific rules. The “Opinions”
propose the prudent and orderly development of the futures and derivatives
market and call for improved regulatory systems for key businesses such as
derivatives. The formulation of these Measures is a concrete step toward
implementing the decisions and arrangements of the CPC Central Committee and
the State Council, as well as advancing the implementation of the relevant
provisions of the Futures and Derivatives Law.
The “Measures” set out provisions regarding derivatives
trading and settlement, derivatives traders, derivatives business institutions,
derivatives market infrastructure, supervision and administration, and legal
liabilities. The main contents include:
- Clarifying the scope of application.
- Defining
the functional positioning of the derivatives market in terms of risk
management, resource allocation, and service to the real economy.
- Establishing
the basic principles that all parties participating in derivatives trading
and related activities must follow, and prohibiting the use of derivatives
trading for illegal or non-compliant activities.
- Standardizing
derivatives trading and its settlement arrangements.
- Strengthening
investor protection by specifying suitability requirements for traders and
introducing a real-name account system for derivatives trading.
- Enhancing
supervision of derivatives business institutions by defining internal
control and risk management requirements. It stipulates that securities
companies and futures companies applying to conduct derivatives trading
business must meet administrative licensing conditions, including
maintaining net capital of no less than RMB 500 million continuously over
the past six months. It also provides that, in accordance with the
principles of prudent regulation, the CSRC may adjust the minimum net
capital threshold, leaving room to impose higher requirements on relevant
institutions as needed.
- Strengthening
supervision of derivatives market infrastructure.
- Clarifying
supervisory responsibilities and legal liabilities.
The “Measures” will come into force on November 16, 2026.
From the date of implementation, all relevant entities engaging in derivatives
trading and related activities will be subject to these provisions.