The mainland's securities watchdog is 'actively studying' allowing H-share companies to buy back their shares in the open market, according to a legal source.
The China Securities Regulatory Commission (CSRC) had been in consultation with Hong Kong lawyers on the issue, the source said.
'I can't think of any disadvantages of allowing the companies to buy back shares,' he said.
As H-share prices have declined, managers at mainland enterprises have found their hands tied when seeking ways to boost the price.
Mainland company law, which governs H-share companies, restricts them from buying back shares except for mergers and the reduction of their share capital only.
The source said it would be a lengthy process to amend the Company Law because it would require approval from the National People's Congress.
