The China Securities Regulatory Commission (CSRC) has published a consultation draft of measures to standardise how “illegal gains” are identified and calculated in securities and futures administrative penalty cases, with the aim of creating unified, publicly articulated enforcement standards. The 23-article draft defines illegal gains as benefits obtained or losses avoided through unlawful securities or futures conduct. It distinguishes between trading-related and non-trading violations, with trading cases generally assessed on trading profit or loss avoided net of costs and taxes directly related to the trades, and non-trading cases generally assessed on revenue derived from the unlawful conduct. Illegal gains from multiple independent violations would be calculated separately, with no offsetting of profits and losses across violations. The draft also sets out calculation methods for common cases including insider dealing, market manipulation, trading using non-public information, and unlawful securities transfers, and includes rules for situations where the securities have not been sold by the time an investigation is initiated. The CSRC is inviting public comments and will revise the draft based on feedback before issuing the measures for implementation in accordance with its procedures.
China Securities Regulatory Commission 2026-04-17
China Securities Regulatory Commission launches consultation on draft rules for determining illegal gains in securities and futures administrative penalty cases
The China Securities Regulatory Commission has issued a consultation draft setting out unified standards for identifying and calculating “illegal gains” in securities and futures administrative penalty cases. The 23-article draft defines illegal gains, differentiates between trading and non-trading violations, prescribes case-specific calculation methods for offences such as insider dealing and market manipulation, and prohibits offsetting profits and losses across independent violations.