Regulatory Changes 1/3

Posted on January 4, 2013 at 6:01 AM

Chinese Securities Journal has reported that China is beginning to run background checks on the 800 plus companies that have applied for domestic share sales in effort to shorten the IPO waiting list and relieve pressure on the stock market. The Chinese Securities Regulatory Commission (CSRC) has been examining the application materials and financial authenticity of IPO applicants, and will disqualify any unsatisfactory applicants. Due to concerns of the strength of the Chinese stock market, the CRSC wants Chinese companies to sell bonds, list overseas, or trade on over-the-counter equity markets as regulators to control supply. The queue means that Chinese companies may have to wait up to or over five years to launch domestic IPO, a condition that Ernst & Young believes may turn some to Hong Kong.

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