Support enterprises to list overseas in accordance with laws and regulations
On December 24, the China Securities Regulatory Commission announced the "Regulations of the State Council on the Administration of Domestic Enterprises' Overseas Issuance and Listing of Securities (Draft for Solicitation of Comments)" and the accompanying "Administrative Measures for the Recordation of Domestic Enterprises' Overseas Issuance and Listing of Securities (Draft for Solicitation of Comments)" ", to further improve the regulatory system for overseas listing of enterprises, which has aroused widespread concern in the market.
For a period of time, due to various factors, China's concept stocks have experienced a round of sharp decline. The market's expectations of overseas listing activities are unstable, and they are even worried that the state will restrict companies from listing overseas.
The public comments on the relevant system and rules will clarify the regulatory policy, improve the system, and dispel market doubts.
Opening to the outside world is our country's basic national policy.
Overseas listings have played an active role in supporting companies to utilize foreign capital, improve corporate governance, and deeply integrate into the world economy. Domestic and foreign investors have also shared the dividends of the long-term stable development of China's economy by investing in listed companies.
The promulgation of the new regulations once again shows that my country’s direction of opening up will not change, nor will it change its attitude in supporting companies to list overseas in compliance with laws and regulations.
Overseas listing must comply with regulations, not only in compliance with domestic laws and regulations, but also in compliance with the rules of the place of overseas listing. This is an inherent requirement for a high level of institutional openness.
For a long time, there have been some shortcomings in my country's supervision of overseas listing of enterprises, and relevant management regulations have not been able to fully meet the needs of market development and expansion of opening up.
my country’s current legal basis for regulating the overseas listing of enterprises is mainly based on the "Special Provisions of the State Council on the Overseas Stock Raising and Listing of Joint Stock Limited Companies" issued in 1994. It was formulated in the early development of my country’s capital market. In practice, some overseas listed companies have also experienced serious problems. Violations of laws and regulations have damaged the overall international image of Chinese companies and adversely affected Chinese companies’ overseas financing.
Therefore, it is absolutely necessary to comprehensively revise the overseas listing rules based on the actual conditions of market development.
The purpose of improving the regulatory system for overseas listing of enterprises this time is to seek development through opening up and promote development through regulation, not to tighten the regulatory policies for overseas listing.
The new regulations will provide clearer, more transparent and actionable rules for companies' overseas listing activities, maintain smooth overseas financing channels, and promote companies to carry out overseas listing activities in accordance with laws and regulations, and achieve healthier and more sustainable development.
This time, we improved the regulatory system for overseas listing of enterprises, unified the filing management of the direct and indirect overseas listing activities of enterprises, and enhanced the inclusiveness of the system.
In the implementation of the system, it embodies seeking progress while maintaining stability and taking the lead in stabilizing the word. Start with increments first, and provide sufficient transition period for existing enterprises to ensure the smooth implementation of filing management.
At the same time, the new regulations clearly strengthen domestic and overseas supervision and coordination to consolidate the responsibilities of market entities.
While standardizing management, it is liberalized and invigorated. It does not review whether the company meets the requirements for issuing and listing overseas, nor does it conduct disguised approvals. This reflects the spirit of "delegation, regulation, and service" reform.
The regulatory system for overseas listing of enterprises has been improved this time, a negative list has been given, and “traffic lights” have been clearly set up. It is clear that laws and regulations prohibit listing and financing, threaten or endanger national security, have major ownership disputes, and have illegal and criminal activities. After going public, the agreement control (VIE) structure enterprise that meets the compliance requirements can go to the overseas listing after filing.
These regulations address key market concerns and worries, and are conducive to building a more stable and predictable institutional environment for companies' overseas listing activities.
The improvement of the regulatory system for overseas listing of enterprises this time is an important measure for my country to deepen the two-way opening of the capital market.
The purpose of the reform is to continue to vigorously support the development of overseas financing by enterprises, and to clarify the “unable” areas of overseas listing. It is an effective means of overall planning and opening up and safety, and will help promote enterprises to go public overseas in accordance with laws and regulations.
The policy will greatly improve the overall compliance level of Chinese companies’ overseas listings, better play the active role of overseas listings in promoting technological progress, supporting enterprise development, and participating in international competition, and promote the standardized, healthy and orderly development of overseas listing activities of enterprises. Protect the legitimate rights and interests of domestic and foreign investors.
The improvement of the overseas listing system reflects the policy direction of marketization, rule of law, and internationalization. It will effectively play the role of the rule of law in securing the foundation, stabilizing expectations, and benefiting the long-term. The certainty of the system is used to hedge the uncertainty of the external environment. It embodies my country's firm determination to adhere to both standardization and development, and to promote further expansion and opening of the capital market.