(Yicai Global) Nov. 2 -- China has established its first securities arbitration center to resolve disputes in the capital market.

The China Shenzhen Securities Arbitration Center, a joint initiative of the Shenzhen Court of International Arbitration and the Shenzhen Stock Exchange, is the world's first securities arbitration facility formed by an international arbitration institution and a stock exchange, Shenzhen Special Zone Daily reported today.

The country's securities market, which includes the world's second-largest stock exchange in Shanghai, could use a more specialized institution to settle disagreements between brokerages and investors. More than 4,400 firms are listed on China's mainland bourses with a total market value of more than CNY83 trillion (USD12.97 trillion).

The Shenzhen Court of International Arbitration accepted more than 7,450 cases involving sums exceeding CNY61.6 billion (USD9.6 billion) last year, according to Liu Xiaochun, president of the court. More than 55 percent of the cases involved finance and capital markets.

The addition is likely to be welcomed. The number and scale of listed companies are rising as the capital market is advancing reforms, including that of the registration system, so it is urgent to improve dispute solving methods, said Tang Rui, deputy general manager of the SZSE.

The new center is independent, professional, and international and will guarantee listed firms’ healthy development, Tang added.

Another expert agreed. The institution is a symbol of the country’s developing securities market, said Gao Xiqing, former vice chairman of the China Securities Regulatory Commission.

The facility can settle disputes between listed firms, brokerages, and investors in cross-border securities businesses by efficient specialization and division of duties, which should help the nation’s capital market to develop in a healthy way in the long run, Gao added.

Editor: Emmi Laine, Xiao Yi