CSRC seeks opinions: For the most harmful violations of transferring original shares, they will be divided into three discretionary levels based on the transfer amount of "0-30%-50%-100%".

The China Securities Regulatory Commission has drafted the "Administrative Penalty Implementation Rules for Illegal Transfer of Securities" and is now seeking public opinions. The Rules differentiate between different types of illegal transfer of securities, with the main purpose being to set different discretionary levels to achieve proportionate penalties. Specifically: 1. For the most harmful illegal transfer of original shares, there are three discretionary levels based on the transfer amount of "0-30%-50%-100%". 2. For other transfer of securities that violate restrictive provisions in terms of holding period and selling time, there are three discretionary levels based on the transfer amount of "0-20%-30%-100%". 3. For transfer of securities that violate restrictive provisions in terms of selling quantity and information disclosure, there are three discretionary levels based on the transfer amount of "0-10%-20%-100%". 4. For actions of not suspending trading according to regulations, the penalty is based on the nature of the behavior and the degree of social harm, applying a "multiple penalty" within the range below the equivalent value of trading securities, with three discretionary levels of "0-3 times-5 times-10 times" based on the illegal gains and a fixed penalty of "100 million yuan-300 million yuan-500 million yuan-1000 million yuan" for illegal gains below 1 million yuan. Additionally, in cases of short-term one-way selling causing a change in control of a listed company, a provision is added within the heavier penalty range of the fixed penalty stating that "for particularly serious cases, a fine of over 10 million yuan and up to 30 million yuan shall be imposed". Furthermore, considering that the harm caused by not suspending trading is generally lower than that of typical violations such as reduction of holdings under the same circumstances, it is stipulated in Article 11(2) that "the amount of the fine determined based on the preceding paragraph shall not exceed the upper limit of the fine amount determined under the discretionary levels in Article 10 of this Rules under the same circumstances."