A report by the National People's Congress (NPC) Law Committee to the Standing Committee said pending legislation would set a narrower scope on investment fund operators than formerly proposed.

The legislation is likely to clearly define the role of fund management companies and qualified commercial banks as managers or trustees of securities investment funds.

The third session of the Tenth NPC Standing Committee heard the Law Committee report on the drafting of the securities investment fund law Monday afternoon.

The report said that in a bid to enhance the integrity of investment fund operators, the draft law should set stricter requirements for the qualification and proficiency of fund management companies and their senior executives.

The report also said the draft law would stipulate specific liabilities of both managers and trustees of securities investment funds in separate items.

In order to ensure that investors promptly receive all their money when selling their shares back to investment funds, the new law would require fund managers to retain an adequate amount of cash or treasury bonds on account, the report said.

The draft law on securities investment funds was tabled for review at a previous NPC Standing Committee session in July 2002. The draft law will be reviewed again at this session, which began Monday.

(Xinhua News Agency June 24, 2003)