Under the rules, the total number of options to managerial personnel should not exceed 10 percent of the overall amount of the stocks of the listed firm involved, and listed firms should introduce share reforms before they are eligible for option schemes.

China's ongoing share reforms aim to allow about two thirds of the shares of the listed firms to be floated through a package of compensation for minority shareholders.

Domestically listed Chinese firms had to promise two thirds of their shares will not be floated for an unspecified period of time when the country's stock markets were launched 15 years ago, which the commission said has proved to be a bad policy that should be done away with.

The commission said the rules were formulated as part of the efforts to implement a package of decisions by the Chinese government for reform and opening-up of the country's capital market and its recent decision to improve corporate governance.

The Chinese version of the rules, which contain seven chapters and 53 articles, are available on the official website of the commission. Enditem