China keeps offshore listing channels open and accelerates introduction of new rules: official

The file photo shows the entrance of the China Securities Regulatory Commission (CSRC) in Beijing, capital of China. (Photo: Xinhua)

The head of China’s securities regulator has promised to expand market access while promoting cooperation with US regulators to create a predictable regulatory environment for listed companies.

China will accelerate the introduction of new rules for overseas listings and maintain a smooth and open flow for the channel, Yi Huiman, chairman of the China Securities Regulatory Commission (CSRC), said during a meeting over the weekend.

Yi’s comments would weigh on investor confidence amid the recent flare-up of COVID-19 in multiple regions across China and rising external uncertainties brought on by the Russia-Ukraine conflict and China-US audit talks, which weigh on Chinese stocks , largely strengthen, experts said.

China will maintain its pace in opening up the capital market, Yi said, noting that the regulator has continued its efforts to take a series of pragmatic measures such as promoting the expansion and optimization of the Shanghai-London share link and the steady expansion of the two-way Connection strengthens opening of commodity and futures markets, enrichment of offer of international varieties.

Mainland China’s capital market will strengthen pragmatic cooperation with Hong Kong, which will remain the international financial center.

At the end of March, there were 4,782 domestically listed companies with a total market capitalization of 80.7 trillion yuan (US$12.68 trillion), ranking second in the world.

The number and market value of listed companies increased by 33.4 percent and 85.3 percent respectively compared to the end of 2018, helping to solidify the steady recovery of the real economy, data from the CSRC showed.

For Chinese firms seeking overseas listings, the regulator said it will expedite the introduction of new regulations for those firms and maintain a smooth channel for them. It will continue to work with US regulators to create “a predictable international regulatory environment for a capital market with high-quality opening,” Yi said.

“Yi’s remarks, which implement the spirit of last month’s meeting of the Financial Stability and Development Committee chaired by Vice Premier Liu He, which vowed to keep the capital market stable, are very important to further calm the capital market, leading the conducive to long-term development. long-term and healthy development of the A-share market,” Yang Delong, chief economist at Shenzhen-based First Seafront Fund Management Co, told the Global Times on Sunday.

According to Yang, the stock market has entered a recovery phase after a period of decline with some fluctuations.

The U.S. Securities and Exchange Commission recently placed several U.S.-listed Chinese stocks on its so-called watch list of companies that could be forced to delist under the Holding Foreign Companies Accountable Act, resulting in Hong Kong-listed tech stocks suffered a nosedive.

Chen Li, chief economist at Chuancai Securities, told the Global Times on Sunday that strengthening opening-up and reforms has always been an important means of building a diversified capital market, not only attracting foreign investors to enter, but also supporting some high-level investors would. Quality company to go global.

“Faced with newly emerging regulatory issues such as the confidentiality of listed companies, policies need to be optimized according to the actual situation, which will help protect the legitimate rights and interests of listed companies,” said Chen.

The CSRC announced changes to cross-border regulations for overseas-listed Chinese companies on April 2 in a draft regulatory document addressing confidentiality and document management for overseas listings. Experts said this shows China’s continued efforts to settle the audit dispute with the US while protecting the country’s data security.

The changes will “facilitate cross-border regulatory cooperation, including joint inspections, which will help protect the interests of global investors,” the CSRC said.

China held several rounds of candid, professional and productive meetings with the US Public Company Accounting Oversight Board.

With the ball now in the U.S.’s hands, as China has shown its goodwill to remove obstacles that allow for increased audit cooperation, the latter should end its arbitrary jurisdiction and crackdown on U.S.-listed Chinese companies, experts noted .