China's securities watchdog has offered some comfort to disgruntled investors whose legal claims for compensation from listed companies that manipulated stock prices have been suspended. Gao Xiqing, vice-chairman of the China Securities Regulatory Commission (CSRC), reiterated that investors and shareholders exercising their rights through the judiciary was the way forward, the China Securities newspaper reported yesterday. However, Mr Gao conceded that inadequate regulation remained an obstacle to facilitating judicial development. Legal procedures, methods for compensation and the regulation under which an application should be made, still had to be decided, he said. Mr Gao said a lack of enforcement to weed out irregularities resulted in more investors visiting the courts to seek compensation. His comments delivered a small boost to domestic A shares. The Shanghai A-share Index rose 1.8 per cent to 1,773.32. The Shenzhen A-share Index gained nearly 2 per cent to 513.89. 'This is a gesture of responsibility to society from the CSRC, and a response to stock investors,' said Yan Yiming, a lawyer at Allbright Law Firm. The firm is representing shareholders of disgraced Guangxia (Yinchuan) Industry to seek compensation after the company was found to have inflated its earnings. 'But the courts are also as . . . responsible for maintaining order in the stock markets,' Mr Yan added. The markets have seen a spate of lawsuits by small investors over the past few months after a number of listed companies and accountant firms were investigated by the CSRC and the finance ministry for alleged abuses. More than a month ago, however, the government announced it would suspend acceptance of such cases and put those filed on hold, citing inexperience as a reason.