China revising funds law to protect investors

 BEIJING, June 26 (Xinhua) -- China's top legislature on Tuesday started to review a draft amendment¹ that would impose new regulations on the country's privately² offered funds, a move aimed at preventing illegal fundraising and trading.

This was the first opportunity for lawmakers to debate the draft amendment to the Law on Securities Investment Funds submitted to the National People's Congress (NPC) Standing³ Committee.

The funds law went into effect in June 2004, but did not bring China's emerging privately offered funds under supervision⁴, resulting in increasing risks to the country's financial system and social stability.

"Some managers of privately offered funds conduct illegal fundraising activities by borrowing in the name of private funds, harming investors⁶' interests by not imposing⁷ strict supervision on the managers," Wu Xiaoling, vice⁸ chairperson of the NPC's Financial and Economic Committee, said when briefing the lawmakers.

"Without specific supervision over privately offered funds, rogue⁹ trading and insider trading by managers will be rampant¹⁰ despite crackdown campaigns."

Li Xuli, a former key manager of the Bank of Communications Schroder Fund Management Co., Ltd., was arrested and charged as a rouge¹¹ trader who caused investors to lose more than 10 million yuan.

If the court returns a guilty verdict, Li's case will be the largest rouge trader scandal in China's securities history and demonstrates the dangers of a loose regulatory environment.

According to Wu, 69 fund management firms around China managed total fund assets with a net value of 2.2 trillion yuan (338.4 billion U.S. dollars) as of the end of 2011, 8.5 times the net value of fund assets in 2003.

The market value of securities investment funds accounted for 7.7 percent of negotiable market value of the Shanghai and Shenzhen bourses as of the end of 2011, making it the most important institutional investor⁵ in China's security market.

The draft amendment also introduces two new types of fund organizations -- unlimited¹² liability fund and board fund -- in a move to better protect investors' interests.

Managers in an unlimited liability fund will bear unlimited joint¹³ and several liability for the fund's debts. In a board fund, a board will be established through a fund shareholders¹⁴' assembly as a standing organization to supervise fund managers.

"The legislature effort for the draft amendment will introduce specific and strict regulations over privately offered funds and improve environment of funds and security markets," said Hu Lifeng, general manager of the funds research center under China Galaxy¹⁵ Securities.

The draft law will also help ease investor's worries and concerns about the uncertaintiues of how investors behave under privately offered funds, Hu added.

1 amendment   

n.改正，修正，改善，修正案

参考例句：

• The amendment was rejected by 207 voters to 143.这项修正案以207票对143票被否决。
• The Opposition has tabled an amendment to the bill.反对党已经就该议案提交了一项修正条款。

2 privately   

adv.以私人的身份，悄悄地，私下地

参考例句：

• Some ministers admit privately that unemployment could continue to rise.一些部长私下承认失业率可能继续升高。
• The man privately admits that his motive is profits.那人私下承认他的动机是为了牟利。

3 standing   

n.持续，地位；adj.永久的，不动的，直立的，不流动的

参考例句：

• After the earthquake only a few houses were left standing.地震过后只有几幢房屋还立着。
• They're standing out against any change in the law.他们坚决反对对法律做任何修改。

4 supervision   

n.监督，管理

参考例句：

• The work was done under my supervision.这项工作是在我的监督之下完成的。
• The old man's will was executed under the personal supervision of the lawyer.老人的遗嘱是在律师的亲自监督下执行的。

5 investor   

n.投资者，投资人

参考例句：

• My nephew is a cautious investor.我侄子是个小心谨慎的投资者。
• The investor believes that his investment will pay off handsomely soon.这个投资者相信他的投资不久会有相当大的收益。

6 investors   

n.投资者，出资者( investor的名词复数 )

参考例句：

• a con man who bilked investors out of millions of dollars 诈取投资者几百万元的骗子
• a cash bonanza for investors 投资者的赚钱机会

7 imposing   

adj.使人难忘的，壮丽的，堂皇的，雄伟的

参考例句：

• The fortress is an imposing building.这座城堡是一座宏伟的建筑。
• He has lost his imposing appearance.他已失去堂堂仪表。

8 vice   

n.坏事；恶习；[pl.]台钳，老虎钳；adj.副的

参考例句：

• He guarded himself against vice.他避免染上坏习惯。
• They are sunk in the depth of vice.他们堕入了罪恶的深渊。

9 rogue   

n.流氓；v.游手好闲

参考例句：

• The little rogue had his grandpa's glasses on.这淘气鬼带上了他祖父的眼镜。
• They defined him as a rogue.他们确定他为骗子。

10 rampant   

adj.(植物)蔓生的；狂暴的，无约束的

参考例句：

• Sickness was rampant in the area.该地区疾病蔓延。
• You cannot allow children to rampant through the museum.你不能任由小孩子在博物馆里乱跑。

11 rouge   

n.胭脂，口红唇膏；v.(在…上)擦口红

参考例句：

• Women put rouge on their cheeks to make their faces pretty.女人往面颊上涂胭脂，使脸更漂亮。
• She didn't need any powder or lip rouge to make her pretty.她天生漂亮，不需要任何脂粉唇膏打扮自己。

12 unlimited   

adj.无限的，不受控制的，无条件的

参考例句：

• They flew over the unlimited reaches of the Arctic.他们飞过了茫茫无边的北极上空。
• There is no safety in unlimited technological hubris.在技术方面自以为是会很危险。

13 joint   

adj.联合的，共同的；n.关节，接合处；v.连接，贴合

参考例句：

• I had a bad fall,which put my shoulder out of joint.我重重地摔了一跤，肩膀脫臼了。
• We wrote a letter in joint names.我们联名写了封信。

14 shareholders   

n.股东( shareholder的名词复数 )

参考例句：

• The meeting was attended by 90% of shareholders. 90%的股东出席了会议。
• the company's fiduciary duty to its shareholders 公司对股东负有的受托责任

15 galaxy   

n.星系；银河系；一群(杰出或著名的人物)

参考例句：

• The earth is one of the planets in the Galaxy.地球是银河系中的星球之一。
• The company has a galaxy of talent.该公司拥有一批优秀的人才。