Mainland courts are expected soon to accept civil cases involving stock price manipulation and insider trading in a move to give more protection to retail investors.
'We have yet to receive an official edict from the supreme court to go ahead with the hearings, but we are ready to accept those cases now,' a judge at the Shanghai No2 Intermediate People's Court said yesterday.
The Supreme People's Court is likely to issue a decree soon, allowing lower courts to hear cases related to insider trading and price rigging, Caijing magazine reported on its website, citing an unidentified official of the court.
The decree will broaden the scope for retail investors seeking compensation, as courts now hear cases involving false information disclosure by listed companies.
'It is a sign that the central government is taking a significant step to better regulate the market,' said Gong Zhenhua, a partner with Shanghai-based Ronghe Law Firm.
'A series of notorious stock fraud cases have tarnished the reputation of the country's capital market and the officials hope to send a wake-up call to those who are likely to commit similar crimes.'
The mainland markets have been surging since last year, stirring concerns over a repeat of the situation earlier this decade when they were hit by a series of scandals amid rampant trading and runaway investment.