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Our Ref: No.9 [2003] CSRC
June 24, 2003
Party Concerned:
Shenzhen Yilong Investment Co., Ltd, domiciled at Room 608, Wande Building, No.19, Shennan Middle Road, Futian District, Shenzhen city. Its legal representative is Xu Liming.
On April 10, 2001, China Securities Regulatory Commission (hereinafter referred to as the CSRC) made an investigation into the case regarding the illegal practices of Shenzhen Yilong Investment Co., Ltd, (hereinafter referred to as Shenzhen Yilong) in securities transactions by opening an individual account. The relevant investigation has been completed. Informing and hearing procedures have also been performed.
Between March 8, 2001 and March 19, 2001, your company opened a capital account (account No.: 2831) in the name of your company in the securities business branch at Jianghan N. Road, Wuhan City of Changjiang Securities Co., Ltd, and bought 2,899,690 shares of “Shen Wan Shan A Share” by using 12 individual stock accounts. These shares were sold completely as of June 11, 2001, making a profit of CNY5, 952, 733.28.
The above facts are identified based on the registration documents, account details of stock transaction account, transaction details, capital flow of Shenzhen Yilong and statistical documents regarding profit and loss of “Shen Wan Shan A Share” in Shenzhen Stock Exchange. The evidences are authentic and sufficient for the judgment.
Therefore, the CSRC decides that the fact that Shenzhen Yilong opened an individual account to conduct securities transaction violates the provision under Article 74 of Securities Law of the People’s Republic of China (hereinafter referred to “Securities Law”): “The legal person is not permitted to open an individual account in the securities transaction, thus resulting in illegal action as stipulated in Article 149 of the Securities Law: “The legal person violates the provision and opens an individual account to conduct securities transaction.”
In accordance with the relevant provisions under Article 190 of the Securities Law, the CSRC hereby makes the following decisions: To confiscate the illegal incomes of CNY5, 952, 733.28, and impose a fine of CNY5, 952, 733.28.
The above party shall pay their fines to the CSRC (Opening Bank: CITIC Industrial Bank Head Office, Account No.: 7111010189800000162. The fines will be submitted to the treasure house directly by the bank) within 15 days as of the date of the issuance of this Letter of Disciplinary Penalty, and file the copy of payment voucher with the Department of Legal Affairs of the CSRC. If the parties disagree with the penalties, they can raise administrative reconsideration to the CSRC within 60 days as of the date of the receipt of this Letter of Disciplinary Penalty, and can also directly raise litigations to the people’s court with jurisdictions within 3 months as of the date of the receipt of this Letter of Disciplinary Penalty. Yet the above decisions shall continue to be executed during the period of reconsideration and litigation.
The China Securities Regulatory Commission
(This English version by Shenzhen Securities Information Co., Ltd. is for your reference only. In case any discrepancy exists between the Chinese and English context, the Chinese version shall prevail.)
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