The Shanghai and Shenzhen stock exchanges have made proposals to reduce the time that listed companies can suspend their shares, Bloomberg reports, amid concerns that some firms are using the tool to avoid volatile markets.
Trading halts to allow for restructuring will be limited to 10 days if the proposals are confirmed, according to the exchanges, down from three months under the current system.
Share halts have created anxiety for some onshore investors who have found themselves unable to offload holdings for several months despite losing faith in the company. During the 2015 crash, nearly half of China’s stock market was suspended in this way, drawing criticism from index-maker MSCI Inc. and other international bodies.
Earlier this month, the China Securities Regulatory Commission announced plans to cut the maximum trading halt period, saying that such practices were too frequent in China compared with more developed markets.