Securities Market to Adopt New MeasuresChina's securities market has seen rapid growth in the past decade. However, problems still exist. For this reason, the relevant government departments have recently launched or are planning to launch an array of measures, which, together with the expected debut of China's Growth Enterprise Market (GEM), will fuels the further standardization and development of China's securities market.Reform should be first made in the share issuance system to make all qualified companies, no matter they are state-owned companies, or non-government companies and Sino-foreign joint ventures, to go public on the stock market. Presently, share issuance is not recommended by government departments as before. A new issuance procedure has been adopted. First, the potential listed company files an application, and then, with a recommendation from the lead underwriter, summits the application to the examination committee for review and examination. After that, the application will be forwarded to China Securities Regulatory Commission (CSRC) for approval. Besides, the pricing method has also been improved. Except for the former way of issuing at a prefixed price on the stock exchanges trading system, a competitive bidding pricing method has been introduced. A market-oriented pricing method will be adopted step by step. Moreover, online trading is encouraged. Earlier this year, CSRC issued two rules concerning online securities trading on agent basis, which provides the necessary rules and regulations for standardized development of online trading on agent basis. Statistics shows, to date, more than 40 securities companies have applied to CSRC for online securities trading on agent basis. The establishment of China GEM will provide a direct financing channel for hi-tech enterprises and growth enterprises and offer an exit for venture investment. At present, rules formulation and system development are in full swing. With legislation and technical work finished, China GEM will be launched very soon. The securities investment fund is one of the major institutional investors. Currently, China has only closed-end funds. Next step, it will start experimenting with open-end funds. Meanwhile, it will launch the Sino-foreign joint fund management company on a trial basis at an appropriate time. In addition, CSRC and China Insurance Regulatory Commission (CIRC) are now applying jointly for permission of operation of insurance funds by the pilot insurance fund management company so that insurance funds can access the securities market. (Panorama) |
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