The China Securities Regulatory Commission (CSRC) said late on Wednesday that it would deal severely with any shareholder who violates this rule. The CSRC are an institution who oversee the securities and futures market of China, to ensure it is operating legally .
This announcement came after the stock market showed signs on seizing up on Wednesday as panic set in following a plunge in resource-heavy commodities. IG Markets Strategist, Evan Lucas has said; “Iron ore has just logged its worst trading day on record. The steel price in China is now cheaper per tonne than cabbage” .
The Shanghai Composite Index slid 5.9% on Wednesday as official attempts to stop the selling were overshadowed by data of an unprecedented margin .
The market then opened on Thursday morning just shortly before the Shanghai Composite Index fell more than 3% in the first thirty minutes of trading, before then rising 1.4%, whilst the Shenzhen Component Index opened down just over 1% .
According to Bloomberg, this ban may encourage foreign investors to divest their interests into mainland companies .
Despite the turbulence, China’s cabinet has said the country can reach its economic and social developmental targets later this year.
 China Securities Regulatory Commission. ‘About CSRC’. http://www.csrc.gov.cn/
 The Guardian. ‘China bans major shareholder from selling their stakes for the next six months’. http://www.theguardian.com/world/2015/
 Bloomberg Business. ‘China bans stock sales by major shareholder for six months’. http://www.bloomberg.com/news