Legal basis: Regulations on the Supervision and Administration of Securities Companies
Article 26 Securities companies and their domestic branches shall abide by the provisions of the Securities Law and these Regulations when engaging in the securities business specified in Article 125 of the Securities Law. The business of a securities company and its domestic branches shall be approved by the securities regulatory authority of the State Council, and shall not engage in unapproved business. If two or more securities companies are controlled by the same unit or individual or have a control relationship with each other, they may not engage in the same securities business, except as otherwise provided by the the State Council Securities Regulatory Authority.
Article 27 A securities company shall, in accordance with the principle of prudent operation, establish and improve risk management and internal control systems to prevent and control risks. A securities company shall implement centralized and unified management of its branches, and shall not engage in joint ventures or cooperative operations with others, or contract, lease or entrust others to operate and manage its branches.