Update: CSRC to Lower Threshold for Chinese Companies to List Offshore
Beijing Times, 12/21/12
The China Securities Regulatory Commission (CSRC) has released its revised regulatory guidelines and audit procedures for Chinese companies listing on foreign exchanges. The guidelines will go into effect on January 1, 2013. According to the revised guidelines, Chinese companies applying for foreign listings with the CSRC no longer need to meet the RMB 400 mln minimum net asset value and RMB 60 mln IPO value requirements set out by the agency in 1999.
According to the CSRC, the revised guidelines look to relax requirements and simplify audit procedures for domestic companies to list on foreign exchanges, as well as improve regulatory efficiency.
Editor's Note: Due to the Chinese government's policy forbidding foreign-owned entities from holding Chinese internet, telecom, and TV network operator licenses, Chinese tech companies looking to list on foreign exchanges have traditionally established a variable interest entity (VIE) structure and listed on a foreign exchange through an overseas listing vehicle. Accordingly, the impact of the CSRC's new guidelines will be more limited for Chinese physical network and website operators, but will benefit Chinese tech firms in other sectors (e.g. hardware vendors, software developers, etc.), as well as small-to-medium enterprises in other non-tech sectors.
For more information on this topic, please see "CSRC May Lower Threshold for Chinese Companies to List in HK," MD 12/17/12 issue.
Keywords: overseas wireless hardware software Internet IPO policy telecom CSRC television
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