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BEIJING -- The Chinese legislature approved Saturday morning the Insurance Law which mandates the state regulatory body to prevent risky business operations of insurance companies.

The amended law says the State Council's insurance regulatory body has the right to order the insurance company's shareholders to stop affiliate company transactions that seriously harm the company's interests and undermine its solvency.

The regulatory body could restrict rights of insurance company shareholders if they carry out risky capital operations, the law says.

The revised law will take effect on October 1, according to a statement issued by the National People's Congress (NPC) Standing Committee's bimonthly session which ended Saturday.