China Capital Market: Three Key Changes After New National Nine Articles Implementation

China is currently implementing a long-term strategic overhaul of its capital markets, guided by the Opinions of the State Council on Strengthening Supervision, Preventing Risks and Promoting the High-Quality Development of the Capital Market, commonly referred to as the new National Nine Articles (NNA). Released on April 12, 2024, these guidelines establish a framework intended to be developed over five years, with the ultimate goal of creating a competitive and inclusive capital market by 2035.

The regulatory shift focuses on transitioning the market toward high-quality development by prioritizing the real economy and technological innovation. This transition is further integrated into the draft outline of the 15th Five-Year Plan (2026-30), which emphasizes a combination of an effective market and a proactive government to optimize resource allocation.

Regulatory Tightening and Market Supervision

To execute the National Nine Articles, the China Securities Regulatory Commission (CSRC) introduced six draft rules targeting issuance, listed companies, securities firms, and trading supervision. These measures introduce stricter controls for company listings and issuances, alongside increased oversight for delistings.

Specific regulatory changes include higher standards for applicants on the STAR Market regarding their science and technological innovation attributes. The CSRC has also expanded on-site inspections for companies conducting initial public offerings (IPOs), increasing the proportion of these companies subject to random inspections.

Supervision of listed companies has been tightened, particularly regarding shareholder reductions. New measures address major shareholder reductions and ensure that restrictions on such reductions are complied with even in cases following a divorce.

Institutional Reforms and Trading Oversight

The reform package extends to the institutions facilitating market activity. Securities companies are facing enhanced supervision focused on internal checks, risk management, and overall governance to promote higher quality development.

Trading regulations have also been redefined to address modern market dynamics. New rules specifically define program trading and establish requirements for reporting and risk control. The government has strengthened supervision of high-frequency trading to maintain market stability.

These efforts are part of a broader objective to deepen the implementation of the registration-based IPO system and strengthen investor protection through improved information disclosure.

Strategic Objectives for 2026-2030

As China enters the 15th Five-Year Plan period (2026-30), the capital market is positioned as a crucial pillar for fostering a new development paradigm. The government intends to enhance the market’s role as a hub for national strategic capacity and long-term economic competitiveness.

The strategic focus for this period includes:

• Improving foundational institutions to support technological innovation.
• Expanding the opening of the capital market to international participants.
• Enhancing marketization and rule-of-law governance.
• Improving regulatory efficiency and internationalization.
• Promoting long-term investment to ensure market stability.

These reforms occur amid significant adjustments in the global financial order and the domestic economic landscape, prompting the central government to elevate the functional positioning and governance system of the capital markets.