China Finalizes IPO Disclosure Rule For Foreign Firms

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Last updated at: (Beijing Time) Monday, April 01, 2002

China Finalizes IPO Disclosure Rule For Foreign Firms

China Securities Regulatory Commission has finalized the disclosure rule for foreign companies seeking to list their China operations on the mainland bourses.

DISCUSSION

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Rule Contents

China Securities Regulatory Commission has finalized the disclosure rule for foreign companies seeking to list their China operations on the mainland bourses.

Aside from the regular corporate information, foreign-invested companies must disclose risks involved in their overseas raw material procurement process, technology transfer, and possible changes in preferential tax policies in China .

The listing candidates must also provide information regarding their transactions with their parent company over the past three years.

The rules has been in effect for more than a week.

Current Situation

Foreign companies that have expressed interest in selling their shares to Chinese investors include Anglo-Dutch consumer products giant Unilever's (UN) China unit and Hong Kong 's Bank of East Asia. Some Singaporean companies are also reportedly preparing to get listed.

The additional information requirement isn't likely to deter foreign-invested enterprises, including those from Hong Kong and Taiwan , from seeking stock listing on the Shanghai and Shenzhen stock exchanges.

China is working to attract big-name companies to list on its stock exchanges, which are currently dominated by small-sized and some state- owned enterprises that are yet to profit.

Securities Law of the People's Republic of China

Order of the President of the People's Republic of China
No.12

The Securities Law of the People's Republic of China, adopted at the 6th Meeting of the Standing Committee of the Ninth National People's Congress of the People's Republic of China on December 29,1998,is hereby promulgated and shall go into effect as of July 1,1999.

Jiang Zemin
President of the People's Republic of China
December 29,1998

Securities Law of the People's Republic of China

(Adopted at the 6th Meeting of the Standing Committee of the
Ninth National People's Congress on December 29, 1998)

Contents

Chapter 1		General Provisions
Chapter 2		Issuing of Securities
Chapter 3		Trading of Securities
	Section1	General Regulations
	Section2	Listing of Securities
	Section3	Continuing Disclosure of Information
	Section4	Prohibited Trading Acts
Chapter 4		Takeover of Listed Companies
Chapter 5		Stock Exchanges
Chapter 6		Securities Companies
Chapter 7		Securities Registration and Clearing Institutions
Chapter 8		Securities Trading Service Organizations
Chapter 9		The Securities Industry Association
Chapter 10		Securities Regulatory Authority
Chapter 11		Legal Liability
Chapter 12		Supplementary Provisions

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