CHINA Law and Practice Contributed by: TieCheng Yang, Yin Ge, Lin (Avery) Huang and Weijun (Elliot) Yi, Han Kun Law Offices
financial futures exchange in China. Products traded on CFFEX include China government bond futures, stock index futures and options. In addition, two securities exchanges, the Shenzhen Stock Exchange (SZSE) and the Shanghai Stock Exchange (SSE) list ETF options, such as the CSI 50 ETF option and CSI 300 ETF option. At present, more than 145 futures and options prod - ucts have been listed in China’s futures markets, among them, more than 125 referencing commodi - ties, over 20 referencing financial instruments and one containerised-freight-index-linked future. Commodi - ty-related futures and options account for the major - ity of exchange-traded futures and options in China, representing approximately 70% of the total notional trading volume, according to data from CFA. Innovative Futures and Options Products On 18 August 2023, the SCFIS (Europe) futures con - tract was officially listed for trading on the INE. The underlying index is the Shanghai (export) Container - ized Freight Index based on Settled Rates (SCFIS) (Europe service), which is compiled and published by the Shanghai Shipping Exchange. This is the world’s first shipping futures contract developed based on a Chinese containerised freight index. Given that China’s port cargo and container throughput remains the world’s highest, the launch of the SCFIS (Europe) futures meets the hedging and risk management needs of shipping companies and foreign trade enter - prises. In addition, GFE is positioned to list products related to green development and new energy industries. It has already listed three futures and options products linked to major new energy-related products – silicon metal, lithium carbonate and polysilicon. Meanwhile, CSRC is guiding GFE to develop other green prod - ucts including futures referencing carbon emissions, climate-related factors and electricity. Separately, in China, pursuant to the Notice on Fur - ther Preventing and Dealing with Speculation Risks in Virtual Currency Trading issued by PBoC, the Office of the Central Cyberspace Affairs Commission, the Supreme People’s Court, the Supreme People’s Proc - uratorate, the Ministry of Industry and Information
Technology, the Ministry of Public Security, the State Administration for Market Regulation, the China Bank - ing and Insurance Regulatory Commission (replaced by NAFR in May 2023), CSRC and SAFE on 15 Sep - tember 2021, business activities related to virtual cur - rencies, including derivatives trading, are considered illegal financial activities and are strictly prohibited. As such, there are currently no listed futures contracts linked to virtual currencies in China. Foreign Institutional Investors As mentioned in 1.1 Overview of Derivatives Mar- kets , foreign institutional investors may participate in the trading of CSRC-approved futures and options contracts by obtaining a QFI licence, or directly trade designated futures contracts and options without a licence. Notably, the scope of futures and options available to QFIs has expanded this year. On 20 June 2025, 16 additional commodity derivatives were added to the QFI investment scope. Starting from 9 October 2025, QFIs will be permitted to participate in ETF options, including four ETF options listed on SZSE and five ETF options listed on SSE, totalling nine products. At time of writing, the number of futures and options available to QFIs has increased to 91, and on 9 October 2025, with the expansion to include additional ETF options, the total number will reach exactly 100. It is noteworthy that under CSRC’s rules, QFIs may trade financial futures or options for hedging purposes only. 2.2 Swaps and Security-Based Swaps Regulatory Regimes for Swaps in China All swap transactions in China are conducted OTC, and there are no exchange-traded swap products. The main types of swaps traded in China are, among others, interest rate swaps, FX swaps, credit default swaps (CDSs), commodity swaps and equity swaps. In terms of regulation, as explained in more detail in 3.1.1 National Regulators , China’s financial system follows a sector-based regulatory mode. Therefore, the regulation of China’s derivatives market is carried out by different authorities, mainly based on the type of market participants, the nature of the trading venue
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