From the pilot increment of the Science and Technology Innovation Board to the breakthrough in the stock of the Growth Enterprise Market, on the 30th anniversary of the establishment of the capital market, the registration system reform finally ushered in the final challenge-the full implementation of the registration system for stock issuance.
On October 31, the Financial Stability and Development Committee of the State Council (hereinafter referred to as the "Financial Committee") held a special meeting to convey and study the spirit of the Fifth Plenary Session of the 19th Central Committee of the Party, and to study and deploy the implementation of the financial system.
The meeting was chaired by Liu He, member of the Political Bureau of the CPC Central Committee, Vice Premier of the State Council, and Director of the Financial Committee.
The meeting emphasized that it is necessary to do a solid job of financial reform and opening up in accordance with the strategic deployment made by the Fifth Plenary Session.
It also includes "enhancing the capital market hub function, fully implementing the registration system for stock issuance, establishing a normalized delisting mechanism, and increasing the proportion of direct financing."
The stock issuance system is the most fundamental and basic system of the capital market.
The Third Plenary Session of the 18th Central Committee clearly proposed the important task of promoting the reform of the registration system for stock issuance.
It has been nearly 7 years since the reform of the new share issuance system was officially launched at the end of 2013.
In March of this year, the new "Securities Law" came into effect, which formulated regulations for the full implementation of securities issuance registration.
There are no legal obstacles to the introduction of the registration system in the whole market.
In August of this year, the first batch of companies under the GEM registration system were listed and traded. For more than two months, they have been running smoothly without any systemic risk events.
Recently, with the successive launch of various reforms at the national level, the reform of the basic system of the capital market has also shown a significant acceleration.
A reporter from China Business News noted that this is the sixth time that high-level officials have spoken out on the reform of the registration system within 10 days.
According to the statements of the previous regulatory authorities, the conditions for the registration system to be promoted to the whole market are gradually mature, and the China Securities Regulatory Commission is studying and formulating an implementation plan for the promotion of the registration system in the whole market.
On the day before the meeting of the Financial Committee, the China Securities Regulatory Commission held an enlarged study meeting for the Party Committee and the Party Committee Theory Center Group to convey and study the spirit of the Fifth Plenary Session of the 19th Central Committee of the Party, and to study and deploy system-wide study, publicity and implementation work.
The China Securities Regulatory Commission stated that it will step up the planning and promotion of key capital market tasks during the "14th Five-Year Plan" period, and accelerate the formation of institutions, mechanisms and systems for the capital market to serve the high-quality development of the economy and society.
The first is to focus on increasing the proportion of direct financing, accelerate the improvement of the multi-level capital market system, further unblock the entrance of direct investment and financing, and continuously improve institutional arrangements that are conducive to expanding direct financing and encouraging long-term investment.
At the same time, taking the reform of the registration system and delisting system as a starting point, it will promote the innovation of key systems in all aspects of issuance and underwriting, trading, continuous supervision, and investor protection, and comprehensively strengthen the construction of the capital market infrastructure.
"The twelve key task arrangements during the '14th Five-Year Plan' period highlight the theme of promoting high-quality development, the construction of a new development pattern as the'outline', the development of the real economy as the focal point, and the expansion of domestic demand as the strategic basis. It is an organic and unified whole to focus on doing one’s own affairs well,” said the China Securities Regulatory Commission.
On November 5, 2018, with the establishment of the Science and Technology Innovation Board, substantial progress was made in the registration reform.
Since the beginning of this year, the GEM registration system reform rules have been promulgated, and the registration system has been piloted in the stock market.
According to data from the China Securities Regulatory Commission, it currently takes an average of about 5 months for companies to complete registration from IPO applications, and the efficiency of review and registration has been significantly improved.
The experience accumulated in the pilot program has also given regulators more confidence in the final implementation of the registration system in the entire market.
On October 21, Liu He mentioned in his speech at the opening ceremony of the 2020 Financial Street Forum Annual Meeting that he must vigorously develop a multi-level capital market.
He pointed out that it is necessary to adhere to the nine-character policy of "building a system, non-intervention, and zero tolerance", improve the basic system of the capital market, improve the quality of listed companies, optimize the market structure, and strengthen information disclosure and investor protection.
On the same day, the chairman of the China Securities Regulatory Commission, Yi Huiman, said in a subsequent speech that he would focus on resolving institutional obstacles and speed up the construction of a more mature and established capital market basic institutional system.
He proposed that the reform of the registration system should be taken as the leader to promote the innovation of key systems in the capital market.
On the basis of summarizing the pilot experience of the Sci-tech Innovation Board and the Growth Enterprise Market, we will continue to follow the three principles of respecting the basic connotation of the registration system, drawing on international best practices, reflecting Chinese characteristics and development stages, and steadily implement the registration system throughout the market.
On October 22, Li Chao, vice chairman of the China Securities Regulatory Commission, further stated that the China Securities Regulatory Commission will study and formulate an implementation plan to promote the registration system throughout the market.
At the same time, he also said, "Be prepared for the reform of the market-wide registration system."
Li Chao said that in the past two years of piloting the registration system, the capital market has formed a "three-step" reform rhythm from the science and technology innovation board to the ChiNext to the entire market.
The first step is that the pilot registration system is the first to "break the problem" in the incremental market segment of the Science and Technology Innovation Board.
The establishment of a market-oriented underwriting mechanism for new shares issuance, the pricing of new shares is more rational, the pricing efficiency is significantly improved, and the game in the secondary market is more adequate.
Statistics show that since the opening of the market, there have been more than 180 companies listed on the Science and Technology Innovation Board, and the amount of IPO financing accounted for half of the A shares in the same period.
The second step is to use the Growth Enterprise Market as a pilot registration system for the stock market.
The ChiNext market involves more than 800 stock listed companies and more than 46 million stock investors. The registration system reform fully considers the risk tolerance of stock investors, trading habits and the regulatory practices of stock listed companies, and has made differentiated arrangements in the system design .
As of October 21, there are 38 listed companies under the GEM registration system, with a total market value of more than 700 billion yuan.
On October 31, the Financial Commission directly stated that "the full implementation of the registration system for stock issuance" means that the third step of capital market reform is about to take.
Author: Du Grief