China's stock markets are on their way to maturity - marked by less insider manipulation - with a new regulation controlling stock sales by senior company executives and majority shareholders.

The new rule is especially significant now that China has completed its share-merger reform, floating previously non-tradable shares of State-owned enterprises.

Since the reform, the interests of high-ranking company executives have been linked more closely with that of their companies and their stock prices.

There have been signs recently that they have tried various means to increase the stock prices of their companies, such as by injecting high-quality assets into the companies.

The new regulations will promote sound operation of the companies. It will help prevent insider sales from jeopardizing the interests of individual investors.

Previous laws stipulated that only those who sell more than 5 percent of the overall corporate stock need to disclose the transaction.

This provided room for insiders to gain from manipulative stock sales based on their privileged information.

Senior executives and majority shareholders of listed companies have lately been selling their holdings. In January alone, 19 listed companies saw their high-ranking executives and majority shareholders sell off part of their holdings, according to information released by the Shanghai Stock Exchange. The sales involved many irregularities.

If regulators fail to rein in such irregularities through legal means, senior managers and majority shareholders will continue to take advantage of their positions to profit.

The individual investors will suffer, as will the long-term health of China's stock market.