BEIJING -- A draft law on financial stability was on Tuesday submitted for its first reading to the ongoing session of the Standing Committee of the National People's Congress, the top legislature.

The draft makes stipulations on the establishment of a working mechanism to maintain financial stability, the strengthening of the mechanism to prevent and defuse financial risks, the clarification of the division of responsibilities to handle financial risks, and improved response measures to financial risks.

With the rapid development of the country's financial industry, there are challenges to maintaining financial stability, including inadequacy in the cross-domain response mechanism, ambiguity in the division of responsibilities of related parties, and insufficient risk disposal measures, according to sources within the top legislature.

Important progress has been made in recent years in preventing and defusing major risks, and it is thus necessary to elevate certain existing, effective practices to long-term legal mechanisms, the sources noted.