NPC Standing Committee | Second Draft of Financial Law Strengthens Provisions on Financial Consumer and Investor Protection

Xinhua News Agency, Beijing, Nov. 2 (Reporters Li Yanxia and Zhang Qianqian) The Financial Law of the People's Republic of China (Draft) was submitted on Nov. 2 for a second review at the 25th session of the Standing Committee of the 14th National People's Congress. The second draft expands provisions on the protection of financial consumers and investors, and adds targeted rules on activities such as internet marketing. The Financial Law is a foundational, comprehensive and overarching law that governs the financial sector in China, positioned as the "1" in the financial legal system and playing a guiding, overarching and regulatory role. In June this year, the 23rd session of the Standing Committee of the 14th National People's Congress conducted the first review of the draft Financial Law. Regarding the protection of financial consumers and investors, the second draft adds provisions stating that when providing financial products and services, fair and reasonable transaction conditions shall be set, and unfair and unreasonable provisions shall not be made through standard-form clauses to exclude or restrict the rights of financial consumers and investors, reduce or exempt one's own liability, or increase the liability of financial consumers and investors; marketing entities of financial products and services shall strengthen customer suitability management, understand customer circumstances in accordance with regulations, truthfully explain the content of financial products and services, fully disclose risks, and provide financial products and services that match customer circumstances. The second draft adds targeted provisions on activities such as internet marketing to strengthen regulation and management, including: providing or marketing financial products and services through the internet shall comply with this Law and relevant laws, administrative regulations, regulations of the State Council's financial management departments on such financial products and services, and specialized provisions on providing or marketing financial products and services through the internet; for financial products and services offered non-publicly, advertising, public solicitation, or disguised public solicitation shall not be conducted through the internet or other means. In addition, the second draft adds content on adhering to the market-oriented and law-based direction in financial work and advancing the construction of international financial centers, and adds relevant provisions on asset management business and supervision of cross-border financial activities. This article is reprinted from "Xinhuanet Co., Ltd.", edited by GMTEight's Feng Qiuyi.