The rapid development of banking financial institutions has also brought disorder to the sector. In particular, some investors have illegally used non-self-owned funds to acquire equity in commercial banks, have adopted nominee arrangements to hold equity in commercial banks or have abused shareholder rights to harm the interests of commercial banks. To address this abusive conduct and to overcome regulatory shortcomings, the China Banking Regulatory Commission ("CBRC") promulgated the Interim Measures for Administration of Equity of Commercial Banks (the "Equity Measures") on 5 January 2018 (effective as of the same date) following a month-long comment period. The Equity Measures are intended to regulate the conduct of shareholders (particularly major shareholders) of commercial banks, strengthen the look-through examination of shareholder qualifications, intensify the investigation and punishment of illegal activities, for the purpose of protecting the legitimate rights and interests of depositors and other clients of commercial banks, safeguard the legitimate interests of shareholders, so as to secure the safe and steady operation of commercial banks and to promote their sustainable and sound development.
