BEIJING, March 20 (Xinhua) -- China on Friday unveiled a draft financial law to gather public feedback.

The draft, published on the websites of the Ministry of Justice, the People's Bank of China, the National Financial Regulatory Administration, the China Securities Regulatory Commission, and the State Administration of Foreign Exchange, is open for public comment until April 19.

As the first comprehensive basic law in China's financial sector, the draft seeks to strengthen financial regulation across the board, prevent and defuse financial risks, promote high-quality financial development, address prominent issues constraining such development, and better leverage the rule of law to consolidate foundations, stabilize expectations and deliver long-term benefits.

The draft financial law consists of 11 chapters and 95 articles. It sets out provisions on the direction and overall requirements of financial work, modern central bank system, regulation of financial institutions, financial products and services, financial market system, financial regulation, risk disposal mechanisms, high-quality financial development and security, and legal liabilities.

FOUNDATIONAL LEGAL FRAMEWORK

Industry insiders say the draft financial law is designed to serve as the foundational law in China's financial legal system. Meanwhile, laws governing banking, insurance and securities, together with other financial laws and regulations, set out more detailed rules for specific financial activities.

It strengthens coordination across laws and regulations in different financial areas, sets out legal requirements on fundamental, principled and directional issues concerning financial development, and seeks to address legal gaps in a timely way through top-level design and a macro-level approach.

The drafting of a financial law is of great significance to advancing high-quality financial development, accelerating the building of a strong financial sector, and supporting the country's broader modernization drive, Guo Li, a professor at Peking University Law School, said.

Experts noted that China has made continued progress in financial practice, theory and institutional innovation, forging a path of financial development with Chinese characteristics. However, challenges remain, including inadequate coordination within the legal framework and the absence of a basic law for the financial sector.

Against this backdrop, the formulation of a basic law for the financial sector would help coordinate major institutional arrangements across different areas, address prominent problems through legal regulation, improve the alignment between financial law and financial practice, and provide solid legal support for high-quality development, according to experts.

The formulation of a financial law is of great significance for promptly solidifying the Communist Party of China Central Committee's achievements in practical, theoretical and institutional innovations in the financial sector, and for continuously enhancing the modernization of the country's financial governance system and capacity, Liu Shaojun, a professor at China University of Political Science and Law, said.

STRONGER REGULATION, RISK PREVENTION

A review of the draft reveals that the financial law aims to enhance the coordination between development and security, address legal bottlenecks impeding high-quality financial progress, and reinforce regulations to mitigate risks while promoting high-quality development.

The draft states in its general provisions that China will bring all financial activities under regulation and crack down on illegal financial activities in accordance with the law.

It also calls for classified and tiered regulation of financial activities to improve regulatory precision and effectiveness, promote the establishment of a sound and effective financial regulatory system, enhance the system for delineating regulatory responsibilities, and strengthen mechanisms for protecting the rights and interests of financial consumers and investors.

The draft seeks to improve the mechanisms for preventing, defusing and handling financial risks, and to firmly guard against systemic risks. It upholds market-based and law-based principles for risk disposal.

To promote high-quality development, the draft calls for the financial sector to better serve the real economy, strengthen coordination between financial policy and fiscal, employment and industrial policies, and direct more financial resources toward major national strategies, key areas and weak links.