Core Viewpoint - The futures industry in China has faced intensified regulatory scrutiny since 2025, with over 110 regulatory measures and disciplinary actions issued this year alone, particularly in the area of internet marketing, highlighting a shift from "penalty-driven" to "function-driven" regulation [1][2][8]. Regulatory Environment - The regulatory landscape has seen a significant increase in penalties, with 114 regulatory measures reported by the China Securities Regulatory Commission and local agencies since 2025, covering a wide range of violations including internet marketing, asset management, and internal controls [2][3]. - Internet marketing has emerged as a high-risk area, with at least 14 futures companies penalized for violations related to this sector [2][3]. - The regulatory approach has evolved to include a three-dimensional penalty system focusing on qualification, behavioral norms, and reputational constraints [4]. Compliance Challenges - Many firms exhibit a short-sighted mentality, prioritizing business growth over compliance, which has led to frequent penalties and highlighted the need for a proactive governance system [1][5]. - The industry has been criticized for a persistent "heavy business, light compliance" mindset, particularly in asset management and intermediary cooperation, which has not adapted to new regulatory requirements [6][7]. Future Directions - Futures companies are encouraged to establish a "proactive governance" system, focusing on risk management and compliance training to align with regulatory expectations [9]. - The industry is expected to undergo a transformation, shifting from being mere service providers to becoming risk management partners embedded within the supply chain [9][10]. - Technological advancements are seen as a key direction for compliance management, enabling firms to integrate compliance requirements into business processes and enhance risk identification and management [10][11]. Long-term Trends - The future of compliance governance in the futures industry is anticipated to follow a path of standardization, differentiation, intelligence in risk prevention, and ecological development, aiming for high-quality growth [11][12]. - The core competitiveness of futures companies will increasingly depend on their ability to create value through compliance rather than merely meeting regulatory minimums [12].

Core Viewpoint - The recent implementation of the "Futures and Derivatives Law" and the improvement of supporting regulations signify a comprehensive upgrade of the regulatory framework in China's futures industry, shifting the focus towards "functional guidance" [1][3]. Regulatory Focus - Over 40 penalties have been issued by local securities regulatory bureaus this year, with violations primarily related to internal control and corporate governance [2]. - Key areas of concern include internet marketing management, asset management business irregularities, and information technology management deficiencies [2]. - The weak links in internal control and compliance management have become the focal point of regulatory scrutiny, particularly in areas such as branch management and abnormal trading monitoring [2]. Industry Transformation - The introduction of the "Futures and Derivatives Law" and the new "National Nine Articles" provides direction for high-quality development in the futures industry [4]. - Futures companies are encouraged to focus on their core business and establish compliance and risk management as a core competitive advantage [4]. - Systematic adjustments in compliance management strategies are necessary to enhance risk management capabilities and ensure alignment with regulatory requirements [4]. Future Outlook - The regulatory environment is expected to tighten over the next 3 to 5 years, with stricter oversight of futures companies [4]. - The industry is likely to adopt regulatory experiences from the securities and fund sectors while making localized improvements to achieve higher governance standards [4].