In a Q&A, the China Securities Regulatory Commission (CSRC) assessed recent court and market developments in securities misrepresentation disputes, endorsing the expanding use of special representative litigation and supporting voluntary “advance compensation” arrangements to resolve investor claims. The CSRC highlighted the Nanjing Intermediate People’s Court’s first-instance judgment in the Jintongling special representative litigation as the latest substantive outcome under this procedure, following the Kangmei Pharmaceutical and Zeda Yisheng cases. It emphasised the “explicit opt-out, implicit join” design as a low-cost, collective pathway for investors and as a tool for coordinated administrative supervision and judicial adjudication. For Jinzhou Port, the CSRC noted it had already imposed administrative penalties for securities violations, and that the Shenyang Intermediate People’s Court issued a rights registration notice on 19 December after the China Securities Investor Services Center, acting on authorisations from more than 50 investors, applied to convert the case into special representative litigation, aligning with the new “State Council Nine Measures” call to increase use of the mechanism. Looking ahead, the CSRC said it will continue supporting the China Securities Investor Services Center in its statutory public-interest role of assisting and representing investors in civil litigation and supporting courts’ application of representative litigation procedures. It also backed the advance-compensation fund established for Guangdao Digital misrepresentation claims, announced by Minmetals Securities on 30 December, with the China Securities Investor Protection Fund Corporation entrusted as fund manager, and encouraged market institutions and individuals to pursue advance compensation on a voluntary basis under the Securities Law.
China Securities Regulatory Commission 2025-12-31
China Securities Regulatory Commission backs special representative litigation in the Jintongling and Jinzhou Port cases and supports the Guangdao Digital advance-compensation fund
The China Securities Regulatory Commission (CSRC) endorsed expanding special representative litigation and voluntary advance compensation in securities misrepresentation disputes. Highlighting recent cases, the CSRC emphasized the "explicit opt-out, implicit join" design as a cost-effective collective pathway for investors. The CSRC will continue supporting the China Securities Investor Services Center in its public-interest role and encourage voluntary advance compensation under the Securities Law.