A few days after the discussion, the specific comments of the CDR system finally came out.
On March 30, the General Office of the State Council forwarded the "Notice of the China Securities Regulatory Commission on Several Opinions on Pilot Projects for the Issuance of Domestic Shares or Depositary Receipts within the Innovative Enterprise" (hereinafter referred to as the "Notice") (Note: The "red chip company" referred to in the notice refers to Enterprises registered outside China and whose main business activities are in the territory.)
The reporter of the 21st Century Business Herald combed the key elements of the "Notice". You need to understand this for the introduction of this system.
The "Notice" preliminarily clarified the scope of pilot companies:
Pilot enterprises should be in line with national strategies, master core technologies, and have high market acceptance.It belongs to the Internet, big data, cloud computing, artificial intelligence, software and integrated circuits, high-end equipment manufacturing, biomedical and other high-tech industries and strategic emerging industries, and has reached a considerable scale of innovative companies.
among them,Large-scale red-chip companies that have been listed overseas have a market capitalization of no less than 200 billion yuan; innovative companies that have not been listed overseas (including red-chip companies and domestic registered companies) have a business income of not less than 3 billion yuan in the most recent year. The valuation is no less than RMB 20 billion, or the operating income is growing rapidly. It has independent research and development, leading international technology and is in a comparative advantage position in the competition with the industry.
The State Council has given a general framework, but the details of future pilot companies will be designated by the Securities and Futures Commission.
Established the Scientific and Technological Innovation Industrialization Advisory Committee
The China Securities Regulatory Commission will set up an Industrialization Advisory Committee for Science and Technology Innovation (hereinafter referred to as the Advisory Committee) to help determine the qualifications of the pilot companies, give full play to the role of relevant industry authorities and experts, and strictly select pilot companies. The advisory committee is composed of relevant industry authorities and well-known companies. Home, senior investment experts and other components.
According to pilot enterprise standards,Comprehensive consideration of factors such as business model, development strategy, R&D investment, new product output, innovation capability, technical barriers, team competitiveness, industry status, social influence, industry development trend, business growth, estimated market value and other factorsA preliminary judgment will be made as to whether the applicant company will be included in the pilot scope.
The reporter learned thatThe Securities Regulatory Commission used this as an important basis to review whether the applicant company was included in the pilot, and strictly follow the laws and regulations to accept the audit application for the issuance of the pilot company.
CDR, IPO dual-track system
Unlike previous speculations in the market, the State Department’s documents will allow companies to choose one of the CDRs and IPOs, the two-track system. Specifically, pilot companies may choose to apply for the listing of stocks or deposit receipts according to the relevant regulations and their actual conditions.
It is worth noting that the stocks or depositary receipts issued by the pilot companies in China should be listed and traded on domestic stock exchanges, and they should be registered, deposited, and settled in China Securities Depository and Clearing Corporation Limited. The funds raised by the pilot enterprises may be remitted abroad in the form of RMB or purchased in foreign currency, and may also be retained for domestic use. The use of funds raised by pilot enterprises and the dividend distribution of depositary receipts shall comply with relevant regulations concerning foreign investment and foreign exchange management in China.
The Securities Regulatory Commission shall, in accordance with laws and regulations such as the Securities Law, approve the pilot red chip companies to issue shares publicly in China in accordance with the current stock issuance approval procedures; in principle, the issuance of a pilot red card enterprise depositary receipts shall be approved by the issuance review committee in accordance with the procedures for the issuance and approval of stocks. Application.
How to regulate before this is one of the important obstacles facing the launch of the CDR system. In the “Notice”, the supervisory level also provided guidance.
The "Notice" pointed out thatThe acts of issuing, listing, and trading of the stocks or depository receipts of the pilot companies in the country are all included in the scope of the existing securities laws. The CSRC implements supervision in accordance with the Securities Law, this opinion and related regulations, and establishes a regulatory cooperation mechanism with the securities and regulatory agencies of the relevant countries or regions where pilot red chip companies are listed, and implements cross-border supervision.
1. Information Disclosure
Pilot red chip companies issuing securities in China shall disclose financial information in accordance with laws and regulations such as the Securities Law, and specify related issues such as fiscal year period in the listing arrangements. The financial reporting information of pilot red chip companies that issue securities in China may be prepared in accordance with the Chinese Accounting Standards for Business Enterprises or equivalent accounting standards approved by the Ministry of Finance and the Chinese Accounting Standards for Business Enterprises, and may also be prepared in accordance with international financial reporting standards or US accounting standards. At the same time, it provided adjustment adjustment information according to the Chinese Accounting Standards for Business Enterprises.
2, investor protection
Pilot enterprises must not have any special arrangements or actions that damage the legitimate rights and interests of domestic investors. In the case of issuance of stocks, the existing investor protection system in the territory shall be implemented; the controlling shareholders, actual controllers, directors, and senior management personnel of the not yet profitable pilot companies may not reduce their holdings of stocks held prior to the listing until the company realizes profits. When issuing a depositary receipt, it shall ensure that the actual interest of the holder of the depositary receipt is equivalent to the equity of the holder of the overseas basic stock, and the depositary shall exercise the right of the overseas investor on the basic stock issuer on behalf of the domestic investor. When the legitimate rights and interests of investors are compromised, the pilot enterprises shall ensure that domestic investors receive compensation equivalent to those of foreign investors.
3, legal responsibility
Pilot enterprises and other relevant market entities issuing securities in violation of laws and regulations, failing to disclose information in accordance with relevant regulations, and having false records, misleading statements or major omissions in disclosed information, or having other illegal acts such as insider trading, market manipulation, etc., shall comply with securities laws and other laws. Regulations provide legal liability. If pilot companies and other relevant market entities cause damage to the legitimate rights and interests of investors, they shall be liable for compensation according to law. Investors may directly request them to bear the liability for damages. If the depositary or the custodian violates this opinion and the relevant regulations of the China Securities Regulatory Commission, the China Securities Regulatory Commission may take regulatory measures in accordance with the law and pursue its legal responsibilities.