UPDATE 1-China passes futures and derivatives law, effective Aug 1 -state media

(Adds details on law, background)

BEIJING, April 20 (Reuters) - China passed a futures and derivatives law on Wednesday, state broadcaster CCTV said, marking a further step by the country to strengthen control and manage risks of its derivatives market.

The legislature approved the law following a meeting held by the standing committee of the National People's Congress (NPC), which will be implemented from Aug. 1, according to Xinhua news agency.

The legislature has reviewed the draft and changed its name from futures law to futures and derivatives law after the first version as it aims to regulate more trading in the market.

The third and final draft, which was submitted to the standing committee for review in mid-April, involves further improvement on derivatives trading supervision and specifies rules for foreign institutions' operation in China, according to the NPC.

Full text of the law is not yet available for public. The legislature solicited opinions twice in 2021.

China is the world's second-largest economy and top consumer and leading producer in many commodities.

"The law complements legal shortcomings for futures and derivatives in China... and provides strong guarantee for industry and market development and protects investors," said Xinhua.

China's Tsingshan Holding Group was embroiled in an unprecedented nickel chaos on the London Metal Exchange in early March, further highlighting the necessity of risk management on the derivatives market. (Reporting by Min Zhang and Dominique Patton; Editing by Tom Hogue, Bernard Orr)