CHINA’S top legislature decided to prolong a mandate, which allows the State Council to prepare for reforms that will change the stock listing system from approval-based to registration-based, for another two years to Feb. 29, 2020.

A session of the Standing Committee of the National People’s Congress (NPC), the top legislature, passed the draft decision submitted Friday for review.

The Standing Committee of the NPC authorized the State Council on Dec. 27, 2015 to adjust rules, based on the securities law, to allow stock listings to be changed from an approval-based to registration-based system. The mandate will expire Feb. 28, 2018.

Under the current initial public offering (IPO) system, new shares are subject to approval from the China Securities Regulatory Commission (CSRC) , the top securities regulator.

The new decision, which takes effect Feb. 25, pointed out that the State Council must bring up opinions for revising related laws before the extension period expires.

The securities watchdog was asked to keep promoting IPO system reform and enhance coordination with other agencies to prevent and address financial risks and protect investors’ interests, according to the decision.

The securities regulator has also said it will step up regulation on rejected back-door listings, announcing a cool-down period for firms to restart their public drive.

Businesses that have their first listing rejected will have to wait for no less than three years before trying again, according to the CSRC.

The back-door listing refers to the process that a privately-held company gets included into a stock exchange by purchasing a publicly-traded company.

The CSRC said it will also strengthen supervision over other types of failed IPOs, with the focus on information disclosure about rectifications and changes in financial reports. (Xinhua)