Deepening the Reform and Opening up of the Capital Market, Helping the Development of the Internet Industry——President Fang Xinghai's Speech at the Fifth World Internet Conference Financial Capital and Internet Technology Innovation Forum
Dear Liu Liehong, deputy director, leaders, distinguished guests:
I am very happy to come to the beautiful and elegant Wuzhen to participate in the 5th World Internet Conference and this forum. On behalf of the China Securities Regulatory Commission, I would like to extend my warmest congratulations to the convening of this conference and the holding of the forum! Taking this opportunity, I would like to talk about some ideas on how the capital market and Internet companies can mutually promote growth. Please criticize and correct.
In today's world, information technology represented by the Internet, big data, and artificial intelligence has profoundly affected human life and changed the global economic and security landscape. The Party Central Committee with General Secretary Xi Jinping as the core has profound insight into this trend, attaches great importance to the network industry, and puts forward a major strategy for building a network power. In recent years, a large number of innovative information technology enterprises have emerged in China, playing an important role in deepening supply-side structural reforms, providing new growth momentum, and promoting the economy towards high-quality development. The China Securities Regulatory Commission attaches great importance to the development of the Internet industry, continuously deepens reforms, gives full play to the important role of the capital market in resource allocation, and promotes the innovative development of Internet companies.
First, focus on the coordinated development of the capital market and the network business
On March 30 this year, the China Securities Regulatory Commission and the Central Network Information Office jointly issued the "Guiding Opinions on Promoting the Construction of a Powerful Country in the Capital Market Service Network" to promote the coordinated development of the network business and the capital market, safeguard national network security and financial security, and promote the network. The supervision of Xinhe Securities is linked. The CSRC and the Central Network Information Office have established a work coordination mechanism to actively strengthen work communication, study new situations and new problems in the network market of the network letter enterprises, and promote the capital market reform policy in the field of network information.
The second is to promote the capital market to support high-tech companies such as the Internet to become stronger and better.
In March this year, the General Office of the State Council forwarded the Securities and Futures Commission's "Several Opinions on Piloting the Issuance of Stocks or Depositary Receipts in Innovative Enterprises", creating a more flexible and compatible policy environment for innovative companies to issue equity financing instruments and to list in China. Give full play to the supporting role of the capital market in the innovation-driven development strategy. Under the pilot framework, the special equity structure, corporate governance, operational norms and other matters of the red chip companies can be applied to the laws and regulations of the place of overseas registration. Matters such as share payment processing and employee stock ownership plans are further regulated. Adjusting the financial entry threshold for the listing of innovative enterprises, in view of its characteristics of high growth, high investment, and long profit cycle, enterprises that are explicitly included in the pilot will no longer apply the conditions for the issuance of profits and the absence of unrecovered losses.
The third is to firmly promote the construction of a multi-level capital market system.
Maintain the normalization of new share issuance and increase financing support for enterprises.In recent years, the phenomenon of IPO “blocking lake” that has plagued the market for many years has been eliminated. Eligible IPO corporate audit cycles have been significantly reduced from the past three years to less than nine months, and the predictability of corporate listings has increased significantly. From 2017 to October 2018, a total of 528 companies were listed through IPO financing, raising a total of about 355.4 billion yuan. A total of 409 enterprises completed refinancing during the same period, and the total amount of funds raised was approximately 1.12 billion yuan.
Continue to promote the market-oriented reform of mergers and acquisitions, and play a leading role in the high-quality development of the economy by the merger and reorganization of listed companies.From 2017 to September 2018, the transaction amount and the number of single-chip mergers and acquisitions of listed companies were 3.67 trillion yuan and 5765 yuan respectively. Among them, the proportion of industrial M&A with the goal of “same industry, upstream and downstream” assets has been rising, accounting for 71.88% of the applications for mergers and acquisitions that have been concluded, and has become the mainstream of the market.
Support small and medium-sized enterprises to land in the new three board market, standardize development through listing financing, mergers and acquisitions and other means.The NEEQ is an important platform for service innovation, entrepreneurship, and growth of small, medium and micro enterprises. It is an important component of multi-level capital market service technology innovation. Eligible joint-stock companies in China can apply for listing through the sponsoring securities companies, and are not subject to restrictions on ownership or industry, or they may not be profitable. From 2017 to September 2018, the New Third Board Company raised approximately RMB 181.2 billion through the issuance of stocks and carried out 152 major asset restructurings with a transaction value of RMB 20.3 billion.
Support companies to use the exchange bond market financing.Continue to promote the market-oriented reform of exchange bonds, expand the issue body, enrich the distribution method, simplify the issuance process, and support corporate bond financing. Since 2016, the China Securities Regulatory Commission has launched a pilot program for innovative and start-up corporate bonds to support technological innovation companies to expand financing channels. From 2017 to September 2018, 1,379 companies issued 2,825 corporate bonds through the exchange market, raising 3.37 trillion yuan. As of September this year, 41 innovative and innovative bonds have been issued and raised 6.5 billion yuan.
Fourth, support enterprises to use the overseas market to grow and develop
It is a successful experience of reform and opening up to make good use of both domestic and overseas markets to promote economic development. In recent years, in accordance with the overall arrangements of the Party Central Committee and the State Council on the opening up of the financial industry, the CSRC has significantly accelerated the pace of opening up the capital market, and the links between domestic and overseas markets have become closer. The CSRC has also established good cooperative relations with securities regulatory agencies in neighboring markets such as Hong Kong and Singapore, which has created convenient conditions for domestic enterprises to use overseas market financing. From 2017 to October 2018, a total of 24 companies raised HK$148.3 billion through H-shares, and 32 companies refinanced HK$194.3 billion through H-shares. In particular, the “full circulation” pilot of the H shares of the three companies was successfully completed in the first half of this year. Currently, specific plans for expanding the pilot enterprises are being evaluated, and the financing support role of enterprises and entrepreneurs in the H-share market is further amplified. The successful issuance of the first D-share of CEIBS opened up a new path for domestic listed companies to use the European capital market. The business rules of “Huluntong” are also ready, and it is expected to be launched within the year. Domestic listed companies will be more smoothly distributed to the London market.
This year marks the 40th anniversary of reform and opening up. Along with the magnificent historical process of forty years, China's capital market is also learning to learn from overseas experience and constantly improve. We will continue to adhere to the fundamental direction of serving the real economy, deepen reform, expand openness, improve the system, continuously improve the efficiency of capital market service innovation enterprises, and promote the healthy growth of the capital market in the process of promoting economic innovation and development.
The first is to deepen reform and promote the function of the capital market to play a better role.We will continue to maintain the normal issuance of new shares, reform and improve the stock issuance system with information disclosure as the core, and further improve the predictability of corporate issuance and listing. Deepen the market-oriented reform of mergers and acquisitions, encourage and support listed companies to rely on mergers and acquisitions to refine and strengthen. On the basis of the “small-volume quick” review mechanism, the “division system” audit is implemented according to the industry and is applied preferentially in the high-tech industry. On the basis of the successful completion of the pilot, the H-share company with full H-share circulation and qualified conditions can be applied for full circulation as soon as possible to facilitate the overseas listing of domestic innovative enterprises.
The CSRC is rapidly dropping the internship general secretary to propose the establishment of the science and technology board and the pilot registration system on the Shanghai Stock Exchange, providing a good capital market environment for the growth of innovative companies such as the Internet, and also providing more investment value to the capital market. High growth listed companies.
The second is to expand openness and continuously introduce long-term overseas funds and institutional investors.Do a good job in the follow-up of A-shares into the Alum and FTSE Russell Index, continue to improve cross-border trading arrangements, optimize the exchange interconnection mechanism, respond to the concerns of foreign investors in a timely manner, and facilitate the expansion of A-share allocations by long-term overseas funds. We will vigorously support foreign securities and futures institutions to establish legal entities in China and engage in asset management business.
The third is to strengthen supervision and create a good market order and financing environment.Strengthen the supervision of corporate IPO, refinancing, mergers and acquisitions, and bond issuance, and enhance the guidance and binding force of the securities market to corporate finance. We will continue to crack down on illegal and illegal acts such as fraudulent issuance, false information disclosure, insider trading and market manipulation, maintain a fair market trading order, and protect the legitimate rights and interests of investors.
Without Silicon Valley, there would be no development of the US information industry, and without Wall Street, there would be no prosperity in Silicon Valley. We still have a lot of work to do in how the capital market can better integrate with the Internet industry and form a benign interaction. The CSRC is willing to listen to the opinions of the industry, develop and innovate, improve the system, and make greater contributions to the development of China's new economy.
Finally, I wish this conference and forum a complete success. thank you all!
(Article source: SFC website)