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QINGDAO TODAY
在线翻译:
szdaily -> Business/Markets -> 
Rules for new tech board imminent
    2018-12-05  08:53    Shenzhen Daily

REGULATORS will likely publish rules for Shanghai’s planned “technology innovation board” in January, and will launch the new tech board before June, The 21st Century Business Herald reported yesterday, quoting unidentified sources close to the Shanghai Stock Exchange.

Companies with core technologies can start submitting listing applications as soon as in March or April, but firms with unproven technologies such as blockchain or in traditional industries such as finance or real estate will be disqualified for listing on the new board, the newspaper added.

Plans for the technology innovation board were unveiled early last month. The Shanghai board will adopt a loosely-regulated mechanism for initial public offerings (IPOs), potentially competing with Hong Kong, or even New York.

According to the newspaper, applicants will not be required to be profitable, but must meet a certain threshold in terms of revenue and capitalization.

The new board may also adopt a more flexible trading system, granting stocks more room to rise or fall, and allowing investors to sell shares on the same day of purchase, according to the report.

Around 20 Chinese firms hope to list on the technology board, media reports said last month, citing a meeting between the Shanghai Stock Exchange, brokerages and investment banks.

The companies seeking listings come from tech hubs such as Shanghai, Shenzhen and the Zhongguancun area of Beijing.

Suggesting a lower listing threshold, the Shanghai Stock Exchange said in a statement earlier that the new board will make “more appropriate and differentiated arrangements” regarding companies’ profitability and shareholding structures, and will be more inclusive toward innovators.

“This could be China’s NASDAQ,” said Yang Hai, analyst at Kaiyaun Securities. “It will post a challenge to Hong Kong,” he said, adding Shenzhen’s tech-heavy ChiNext board could also feel the pressure.

Adopting a Western-style registration-based IPO system would give market forces a dominant role in deciding when a company can sell shares publicly, removing regulatory hurdles facing many Chinese listing candidates.

The Shanghai Stock Exchange said that legal hurdles for such an IPO system were removed in December 2015.(SD-Agencies)

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