Research On The Coordination Of Regulatory Functions Between The China Securities Regulatory Commission And The Exchanges Under The Registration Syste

China has begun to pilot the registration-based IPO system in 2019,and then confirmed by the revised new Securities Law.Under the background of the reform of the registration system,obviously,the original functional allocation of regulatory entities in China’s securities market is unable to adapt to the new market environment.The newly revised Securities Law puts forward new requirements for the function of regulatory entities in Chinese securities market,and these function do change correspondingly.The emphasis of the review of the IPO has changed from the judgement of the companies’ value to the information disclosure,and the stock exchanges take the responsibility for reviewing the registration documents,undertaking the actual function of the trading regulation of the China Securities Regulatory Commission.However,the reformation of the regulatory function did not fully meet the requirement in the new environment,there was still little potential conflict and in-coordination,for example,the self-discipline management was too administrative,the independence of the exchanges was yet to improve,the lack of external judicial relief for the approval authority,the insufficiency of the conviction of information disclosure,the administrative intervention was excessive,etc.In order to improve the regulatory system of the securities market,the CSRC and the exchanges need more efficient coordination to assign each one’s regulatory functions and to avoid potential regulatory conflicts,so that they could ensure the efficient operation of the regulatory system and then the registration-based IPO system can be implemented comprehensively.The essence of the registration-based IPO system is the decentralization and simplification of administration and the reduction of governmental intervention,which strengthens the efficiency of the function of market in the area of resource allocation.Under the registration-based IPO system,the role and function of regulatory subjects of the securities market have been relocated.The aim of the transformation of the regulatory functions of the regulatory subjects is to ensure the smooth implementation of the registration-based IPO system.The CSRC has changed itself from being the agent of government regulation to being the servant of market.The nature of the regulatory authority has changed from being positive to being negative,from regulating beforehand to regulating in-process and afterwards.The exchanges have changed themselves from self-regulatory authorities to concurrent regulatory subjects.Their regulatory actions have been changed from post-regulatory to fore-regulatory,from staged-regulatory to regulatory in the whole process.Their administrative and civil responsibilities have all been changed correspondingly,emphasizing the front-line regulation and the self-regulation.For the comparatively ideal functional coordination and allocation mode for the regulatory subjects of securities market,three main principles should be clarified firstly.The first principle is being close to the market.The regulatory duties should be performed by the regulatory entity which knows the market the best,that’s called being closest to the market.The second principle is combining the direct regulation and the indirect regulation.An effective balancing mechanism of self-regulation and governmental regulation should be built and allocated institutionally.The CSRC and the exchanges shall carry out the core cooperation surrounding the investor protection and information disclosure to ensure the combination of the direct regulation and the indirect regulation.Thus,they can achieve a good job in the market governance and improve the regulation efficiency.The third principle is preventing the overlapping regulation.In our country,The supervisory mode of the securities market is not the overlapping regulation but the multiple regulation.The emphasis of regulation should be highlighted.The regulation of the CSRC should be macro and prudent and the regulation of the exchanges should be micro and vetting.Meanwhile,the boundary of responsibilities between the governmental regulation and market-regulation should be made clear by legislation and then the regulatory authorities can be allocated clearly.Thus,the relationship between the market and the government can be straightened out.Secondly,the functional coordination and allocation mode of the regulatory entities should be further improved.The exchanges should assume the direct regulation duties.They should serve the national strategic vision by providing the guidance of resource allocation under the registration-based IPO system,building a regulation system led by the exchanges,and leading the building of the market access system of the registration-based IPO system.The CSRC should assume the indirect regulation duties.It should,surrounding the registration-based IPO system,accelerate the regulation transformation,build and improve the policy system of the capital market in the new stage,unify the regulation to prevent risks,carry out the duties of registration according to the laws,and coordinate the competition among Beijing Stock Exchange,Shanghai Stock Exchange and Shenzhen Stock Exchange.