Article 16 A stock exchange shall establish the membership meeting, the board of directors and specialized committees.

Article 17 The membership meeting shall be the highest organ of power of a stock exchange. The membership meeting has the following powers:

1. formulation and revision of the articles of association of the stock exchange;
2. election and dismissal of member directors of the board;
3. review and adoption of the work reports of the board of directors and the general manager;
4. review and adoption of the financial budget and final settlement report of the stock exchange; and
5. decisions on other major matters of the stock exchange.

The formulation and revision of the articles of association adopted by the membership meeting shall be submitted to the Securities Commission for approval.

Article 18 The membership meeting shall be convened once a year by the board of directors. An ad hoc membership meeting shall be convened in the event of any of the following circumstances:

1. the number of directors is less than the minimum number prescribed by these Measures;
2. at the request of over one third of the members out of the total membership; and
3. when the board of directors deems it necessary.

Article 19 The membership meeting must be attended by over two thirds of the members and its resolutions shall be valid only after adoption by more than fifty percent of the members who are present and vote for them.

A stock exchange shall, within ten days after the conclusion of the membership meeting, submit all the documents and relevant information of the meeting to the Securities Commission for the record.

Article 20 The board of directors shall be the decision-making body of a stock exchange. Its terms of office shall be three years.

The responsibilities of the board of directors shall be:

1. to implement the resolutions of the membership meeting;
2. to formulate and revise the business rules of the stock exchange;
3. to examine and finalize the work plan put forth by the general manager;
4. to examine and finalize the financial budget and final settlement proposals put forth by the general manager;
5. to examine and decide on the admission of members;
6. to examine and decide on the penalty of members;
7. to decide on the establishment of specialized committees in the light of requirements; and (8) other responsibilities given by the membership meeting.

Article 21 The board of directors of a stock exchange shall be composed of 7 to 13 persons, among them the number of non-member directors shall not be less than one third of the total number of the members of the board of directors and not more than fifty percent of the total number of the members of the board of directors.

Member directors shall be elected by the membership meeting. Non-member directors shall be appointed by CSSCC.

A director shall not serve more than two consecutive terms.

The meeting of the board of directors shall be convened at least once a quarter. The meeting must be attended by two third of the directors and its resolution(s) shall be valid only on approval through vote by more than two third of the directors present at the meeting. The resolution(s) of the board of directors shall be submitted to CSSCC for the record within two working days upon conclusion of the meeting.

Article 22 The board of directors shall have one chairman, one to two vice chairmen. The chairman and vice chairman(chairmen) shall be nominated by CSSCC and elected by the board of directors. The general manager should be a member of the board of directors.

Article 23 The chairmen shall be responsible for the convening and chairing of the meeting of the board of directors. When the chairman is unable to perform his/her responsibilities temporarily for unforeseen reasons, the vice chairman designated by the chairman shall perform the responsibilities on his/her behalf.

The chairman shall serve as the president of the meeting during the membership meeting. The chairman shall not concurrently serve as the general manager of a stock exchange.

Article 24 A stock exchange shall have one general manager and one to three deputy general managers. The general manager shall be appointed and relieved of the posts by CSSCC. No public servant of the state shall concurrently serve as the general manager or deputy general manager.

The term of office for the general manager and deputy general manager shall be three years. The general manager shall not serve more than two consecutive terms. The general manager who shall, under the leadership of the board of directors, be responsible for the routine administration of a stock exchange shall be the legal representative of the stock exchange. When the general manager is unable to perform his/her responsibilities temporarily for unforeseen reasons, the deputy general manager designated by the general manager shall perform the responsibilities on his/her behalf.

Article 25 The appointments and relief of the posts of middle-rank cadres of a stock exchange shall be submitted to CSSCC for the record, the appointments and relief of the posts of the persons-in-charge of the accounting and personnel departments shall be submitted to CSSCC for approval.

Article 26 The board of directors shall establish a supervisory commission the term of office of which shall be three years. The chairman shall serve concurrently as the president of the supervisory commission. The supervisory commission which is responsible to the board of directors shall exercise the following powers:

1. to oversee the high-ranking managerial personnel and other staff members of the stock exchange in abiding by the relevant state laws, regulations, rules, policies and the articles of association and business rules of the stock exchange;
2. to oversee the high-ranking managerial personnel in the implementation of the resolution(s) of the membership meeting and the board of directors;
3. to oversee the financial status of the stock exchange; and
4. other powers provided for in the articles of association of the stock exchange.

Article 27 The board of directors may establish subordinate specialized committees in accordance with requirements. Specific provisions shall be made in the articles of association of a stock exchange on matters concerning the responsibilities, term of office and composition of members of all specialized committees.

The expenses of all specialized committees should be integrated into the budget of the stock exchange.

Article 28 Whoever has any of the following circumstances must not be recruited as an employee of a stock exchange and must not serve as a high-ranking administrator of a stock exchange:

1. has committed crimes of corruption, bribes, occupation of property and appropriation of property or the crime of disrupting socio-economic order, or having been deprived of political rights for crime;
2. an employee of a securities operations agency or other financial institutions who has been relieved of the post for acts in violation of law or discipline for not more than five years starting from the date of relief of the post;
3. a lawyer, certified accountant or a professional of a legal asset appraisal agency or capital authentication agency who has been revoked of the qualification for acts in violation of law for not more than five years starting from the date of revocation of the qualification;
4. the legal representative of a company or an enterprise that has been revoked of the business license for acts in violation of law and is personally responsible for the revocation of the business license of the said company or enterprise for not more than five years starting from the date of revocation of the business license;
5. one who has served as a director of the board, director of a factory or manager of a company or an enterprise that has gone bankrupt due to poor management and is personally responsible for the bankruptcy of the said company or enterprise for not more than five years starting from the date of bankruptcy;
6. a functionary of a state organ who has been dismissed for not more than five years starting from the date of dismissal; and
7. other circumstances prescribed by the relevant state laws, regulations, rules and policies.