Core Viewpoint - The China Futures Association has developed a draft rule aimed at managing improper competition in the futures brokerage business, with feedback due by August 15, 2025. The rule seeks to maintain a fair competitive environment, prevent "involution" style competition, and protect the legitimate rights of traders [1]. Group 1: Definition of Improper Competition - The rule clearly defines the boundaries of improper competition in the brokerage business, addressing the long-standing issue of fierce competition and price wars among futures companies [2][3]. - It highlights that some companies have resorted to "zero commission" offers and other improper tactics to attract clients, disrupting market order and harming the trading experience [2]. Group 2: Fee Management Regulations - The rule introduces five core measures to address the issue of "fee involution": 1. Establishing a system to standardize fee management processes, ensuring transparency in fee disclosure and collection [4]. 2. Setting reasonable fee standards based on service costs, ensuring consistency across similar client types [4]. 3. Publicly disclosing the maximum fee standards on various platforms to ensure information transparency [4]. 4. Clearly defining fee agreements with clients to ensure compliance with agreed rates [4]. 5. Implementing strict follow-up procedures, particularly for high-frequency and high-fee clients, to mitigate risks [5]. Group 3: Prohibited Behaviors - The rule outlines seven types of prohibited behaviors in brokerage business, including: - Engaging in malicious competition by charging fees below service costs [5][6]. - Misleading clients about potential profits while concealing risks [6]. - Using false advertising to deceive clients [6]. - Distorting or disparaging other companies to gain clients [6]. Group 4: Strengthening Complaints and Self-Regulation - The rule enhances the mechanisms for complaints and self-regulation, allowing individuals to report violations to the association, which will conduct inspections and impose disciplinary actions as necessary [7]. - Disciplinary actions will be recorded in the industry information management platform and can be publicly disclosed [7]. Group 5: Transition Period - To facilitate the smooth implementation of the rules, a transition period of one month is set for companies to prepare for compliance, followed by a two-month period for existing clients to rectify any non-compliance [8].

Core Viewpoint - The China Futures Association (CFA) has released a draft of the "Management Rules for Unfair Competition in Futures Brokerage Business" to promote fair competition and prevent "involution" in the industry, ensuring the protection of traders' rights [1] Summary by Sections Overview of the Rules - The rules consist of 19 articles that establish a self-regulatory framework addressing various aspects such as behavior definition, fee management, prohibited actions, complaint reporting, and self-discipline [1] Definition of Unfair Competition - Unfair competition in futures brokerage is defined as actions by futures companies or their employees that disrupt the market order and harm the legitimate rights of other companies [1] Core Measures to Address Fee Involution - Establishing a system to standardize fee management, ensuring transparency in the processes of fee announcement, collection, adjustment, and follow-up [2] - Setting reasonable fee standards based on service costs, ensuring consistency in fee structures for similar clients [2] - Publicly disclosing the maximum fee standards on various platforms to ensure transparency [2] - Clearly defining and adhering to agreed fee rates or amounts with clients [2] - Increasing follow-up visits for high-frequency, high-fee, and loss-prone clients to enhance risk prevention [2] Prohibited Actions - The rules outline seven types of prohibited behaviors, including misleading advertising, distorting competitors' reputations, charging below the exchange's fee standards, and engaging in other unfair practices [3][4] Complaint and Self-Discipline Mechanisms - The rules enhance complaint and self-discipline mechanisms, allowing individuals to report violations to the CFA, which will conduct inspections and impose disciplinary actions as necessary [4][5] Implementation Timeline - A one-month preparation period is set for futures companies to establish internal control systems and cost assessments, followed by a two-month transition period for compliance with the new rules [5]