Shanghai Stock Exchange Issuance and Underwriting Violation Supervision (Revised 2026) Announced to Improve the Recognition of Penalty Situations for Violations

“Guidelines for the Application of the Shanghai Stock Exchange’s Rules on Securities Issuance and Underwriting Violations (2026 Revision)” has been published and will take effect from the date of issuance. This revision maintains the basic structure of the “Guidelines for Supervising Violations in Securities Issuance and Underwriting” while adding targeted supplements and improvements to certain provisions. The main revisions are as follows:

First, it improves regulatory principles and rectification requirements. The general provisions clearly state that self-regulatory measures should adhere to the principles of “classified handling, precise regulation, and scientific accountability,” ensuring proportionate penalties. Additionally, it further clarifies the self-inspection and rectification requirements for relevant entities after measures are taken.

Second, it refines the criteria for determining violations and penalties. This includes clarifying standards for assessing the severity of violations, detailing considerations such as negative public opinion and damage to social public interests caused by violations. It also enhances the circumstances for stricter penalties by including violations involving bribery or corruption in the capital market as grounds for increased sanctions. Furthermore, it specifies situations for lighter or exempted penalties, such as when effective measures are taken to mitigate adverse impacts or when intermediaries diligently fulfill their verification duties.

Third, it details specific violations in the issuance and underwriting process. This includes clarifying violations related to securities firms issuing research reports on the investment value of new stocks, and establishing post-event regulatory standards for the achievement of profit forecasts and medium- to long-term stock price performance in investment value research reports. It also expands the scope of violations related to intermediary fee charges.