Warning on illegal trading
By CHAN WAI-FONG
GUANGDONG, the province with China's fastest growing economy, has stepped up measures to crack down on illegal trading in future commodities, the official media reported yesterday.
The China News Service (CNS) said a circular, issued recently by Guangdong's Future Commodities Supervision and Management Committee, Administration for Industry and Commerce, and Administration for the Management of Foreign Currencies, had called a halt to all trading of overseas future commodities.
China had previously banned trading on future commodities markets outside the country.
But the practice was still rampant in China, particularly in Guangdong, where people are among the richest in the country.
Early this month, a future commodities company in the Guangdong city of Qingyuan was closed down and more than 500 investors claimed a total loss of 300 million yuan (HK$270.9 million).
According to the investors, the company had been involved in trading future commodities in Chicago.
The circular warns investors to exercise special caution in all kinds of future commodities trading, and says they have to bear all the risks.
It says futures brokerages should stop all overseas futures trading.
They have been ordered to cancel their registered activities in relation to the trading of overseas future commodities with respective licensing authorities within a month.