[China Securities Regulatory Commission issued the "Implementation Rules for Administrative Penalties in Cases of Illegal Transfer of Securities"] On October 19, the China Securities Regulatory Commission issued the "Implementation Rules for Administrative Penalties in Cases of Illegal Transfer of Securities"), which will be effective from December 1, 2026. The China Securities Regulatory Commission publicly solicited opinions from the public on the "Rules" from April 17 to May 17, 2026, and listened to opinions from relevant parties through convening symposiums and written solicitations for opinions. All sectors of society generally support the content of the "Rules", and the China Securities Regulatory Commission carefully studies the suggestions and suggestions for modification and improvement one by one, and adopts all reasonable suggestions. There are 18 articles in the "Rules", the main contents include: The first is to standardize the identification of "illegal transfer of securities". Clarify the connotation and specific circumstances of "transfer of securities", "transfer of securities within the transfer restriction period" and "transfer of stocks that does not comply with laws, administrative regulations and the provisions of the securities regulatory authority of the State Council" stipulated in Article 186 of the Securities Law, as well as the identification of illegal entities for concerted actors. It should be noted that there are various types of illegal transfers of securities. In order to facilitate law enforcement operations, the "Rules" subdivide illegal transfers of securities into "transfer of securities during the transfer restriction period in violation of the law" and "transfer of securities during the holding period" based on the nature of the securities, the subject of the behavior, behavioral characteristics, and the degree of harm. , the sale time does not comply with the administrative regulations and the provisions of the China Securities Regulatory Commission", "the sales quantity, information disclosure, etc. do not comply with the laws, administrative regulations and the provisions of the China Securities Regulatory Commission" and "the illegal transfer of stocks during acquisitions such as failure to suspend trading as required", and strive to be accurate in characterization and precise enforcement. The second is to standardize the penalties for "illegal transfer of securities". For different categories, different discretionary level indicators are set up to ensure that excessive penalties are equal. At the same time, it also makes enumerated provisions on the circumstances for adjusting the amount and penalty, and makes indicative provisions on the circumstances of combined penalties and severe punishment, the circumstances of adjustment and application in special cases, and market prohibition. Next, the China Securities Regulatory Commission will thoroughly implement the spirit of the "Several Opinions of the State Council on Strengthening Supervision and Preventing Risks to Promote High-Quality Development of the Capital Market", implement the provisions of the "Rules", standardize the determination and discretion of administrative penalties, and severely crack down on various illegal holding reductions in accordance with the law, so as to provide a more solid legal guarantee for building a safe, standardized, transparent, open, dynamic and resilient capital market. (First Financial)