Date
18 October 2017
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The Big Picture: SOE REFORM

China’s state assets regulator said on Thursday that it will propose a long-awaited reform of state-owned enterprises (SOEs) after the upcoming third plenary session of the Communist Party’s 18th Central Committee this month

The proposal from the State-owned Assets Supervision and Administration Commission (SASAC) will redefine roles and functions in the wider operations of state enterprises and tighten oversight of their local offices. Authorities also want the SOEs to be more competitive in a freer market. 

“It is important to have a clear-cut [relationship] between the government and SOEs to ensure a smooth reform process,” SASAC deputy director Huang Shuhe {黃淑和} said earlier on Oct. 20. The planned reform comes as China’s steel, coal, construction materials, chemical, shipbuilding and heavy machinery industries suffer from overcapacity and low profits.

Meanwhile, the China Securities Journal reported on Friday that among the moves that are sought to be carried out after the Party plenum, which will be held November 9-12, is clarification of the businesses that SOEs must conduct as part of a national policy and run along competitive lines.

Other proposals include lifting the ceiling for stock option incentives for senior management of listed SOEs to above 40 percent of their present salaries, as well as allowing private capital to play a bigger part in SOE restructuring and public listing, the report said.

Taobao said to have been approved to sell investment funds online

Alibaba Group Holdings’ Taobao.com has become the first third-party e-commerce platform in China to gain regulatory approval to sell investment funds online but the launch date has not been determined, National Business Daily reported Friday, citing a company source. Alibaba’s Alipay will also provide online payment services for the funds traded on Taobao. Thirty-two fund management firms have already set up home pages on Taobao, and 14 of them will be in the first batch to launch the service, with four based in the country’s south, five in Shanghai and five in Beijing, the report said, citing China National Radio.

Car recall volume doubles from year earlier in Jan-Sept

The number of cars recalled in China roughly doubled year on year in China in the first nine months, with companies issuing 97 recalls affecting 2.69 million vehicles, Xinhua reported Thursday, citing the country’s quality watchdog. The General Administration of Quality Supervision, Inspection and Quarantine said joint-venture companies made 24 recalls involving 1.94 million vehicles, while domestic brands made 23 recalls totaling 349,000 vehicles. Fifty recalls were made on imported vehicles, according to the administration. Brake and wheel flaws were the major reason for the recalls, followed by problems in engines and steering systems, the report said.

New OTC market open to foreign-funded ventures

All qualified companies formed under the limited-share system are allowed to list shares on the New Third Board, an over-the-counter trading market designed for growth enterprises, without any barriers, Xinhua news agency reported Thursday, citing the China Securities Regulatory Commission. Responding to inquiries on its official Twitter-like Weibo, the regulator said all domestic firms, state-owned enterprises and ventures with foreign shareholders can apply for listing, although the last group is required to provide confirmation documents on foreign stake from commerce regulators.

–Contact HKEJ at [email protected]

JP/AC/RC

(First posted: 08.41)

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