Article 1 The present Law is formulated for the purpose of regulating the issuance and transaction of securities, protecting the lawful rights and interests of investors, safeguarding the economic order and public interests of the society and promoting the growth of the socialist market economy.

Article 2 The present Law shall be applied to the issuance and transaction of stocks, corporate bonds as well as any other securities as lawfully recognized by the State Council within the territory of the People's Republic of China. Where there is no such provision in the present Law, the provisions of the Corporation Law of the People's Republic of China and other relevant laws and administrative regulations shall be applied. Any listed trading of government bonds and share of securities investment funds shall be governed by the present Law. Where there is any special provision in any other law or administrative regulation, the special provision shall prevail. The measures for the administration of issuance and transaction of securities derivatives shall be prescribed by the State Council according to the principles of the present Law.

Article 3 The issuance and transaction of securities shall adhere to the principles of openness, fairness and impartiality.

Article 4 The parties involved in any issuance or transaction of securities shall have equal legal status and shall persist in the principles of free will, compensation and integrity and creditworthy.

Article 5 The issuance and transaction of securities shall observe laws and administrative regulations. No fraud, insider trading or manipulation of the securities market may be permitted.

Article 6 The divided operation and management shall be adopted by the industries of securities, banking, trust as well as insurance. The securities companies and the business organs of banks, trust and insurance shall be established separately, unless otherwise provided for by the state.

Article 7 The securities regulatory authority under the State Council shall adopt a centralized and unified supervision and administration of the national securities market. The securities regulatory authority under the State Council may, in light of the relevant requirements, establish dispatched offices, which shall perform their duties and functions of supervision and administration upon the authorization.

Article 8 Under the centralized and unified supervision and administration of the state regarding the issuance and transaction of securities, a securities industrial association shall be lawfully established, which shall adopt the self-regulating administration.

Article 9 The auditing organ of the state shall carry out auditing supervision of stock exchanges, securities companies, securities registration and clearing institutions and securities regulatory bodies.