This comprehensive registration system arrangement includes a series of system reforms and improvements, and the capital market is moving towards marketization, rule of law, and internationalization, highlighting the essence of the registration system reform, which is to hand over the right to choose to the market.
This reform further improves the basic system of the capital market, mainly including improving the issuance and underwriting system and restraining irrational pricing; improving the trading system, optimizing margin financing and securities lending and refinancing mechanisms; improving the independent director system of listed companies; Diversified exit channels; speed up the reform of the investment side and introduce more medium and long-term funds. At the same time, support the national stock transfer system to explore and improve the basic system that is more in line with the characteristics of small and medium-sized enterprises.
The unified registration system and the proper improvement of various systems will bring great benefits to the long-term development of the A-share market and the healthy development of the A-share market ecology; it can reduce human administrative intervention and strengthen the market’s survival of the fittest mechanism. By perfecting the delisting system, and then fully implementing the registration system to achieve double optimization of ‘export’ and ‘import’, the quality of the A-share market will be significantly improved.
The reform of the registration system in China’s capital market is a sector-by-sector pilot, and it will be steadily promoted until it is fully liberalized. During this process, the Shanghai Stock Exchange newly established the Science and Technology Innovation Board, the Shenzhen Stock Exchange reformed the Growth Enterprise Market, merged the main board and the small and medium-sized board, and the New Third Board established a selection layer and then established the Beijing Stock Exchange to establish a transfer mechanism. After the reform, the plate structure of the multi-level capital market has become clearer. The most important thing in this reform is the main board of the Shanghai Stock Exchange and the Shenzhen Stock Exchange. The final critical step in the transition to a full registration system.
The biggest difference between the approval system and the registration system is whether there is a substantive review. This institutional arrangement clarifies the boundaries of power review and requires the entire process to be subject to market supervision, laying the foundation for a comprehensive market-based registration system. At the same time, it has also strengthened the reform concept of combining decentralization and management, and strengthened the supervision of all links in the entire chain of issuance and listing, so as to effectively protect the legitimate rights and interests of investors.
One of the highlights of this comprehensive registration-based reform is the emphasis on the front-end principle of “responsibility upon declaration” to consolidate the responsibilities of issuers and actual controllers. Companies that fail to list after filing for previous IPOs are not held liable. However, in the U.S. market, even if the review fails, if there are problems such as violations of laws and regulations or information disclosure fraud during the registration and listing process, it also needs to bear corresponding legal responsibilities, and the US Securities Regulatory Commission will prosecute it as the subject of public prosecution. This time, by adopting strict regulatory measures on the front-end of registration, companies that do not meet the issuance conditions or have violations of laws and regulations will bear corresponding legal responsibilities, which will also effectively alleviate the “barrier lake” phenomenon of listing caused by all previous companies’ “passing through” IPOs. Enterprises that want to go public will self-examine their own conditions, rather than “break through”.
Segmented management of the front-end, middle-end, and back-end of the listing is also a progress in the reform of the registration system.
This consultation document does not set any administrative restrictions on the issuance price and scale of new shares, and it also paves the way for the reform of IPO issuance prices. Previously, due to the separation of A-share primary market and secondary market prices, some people quickly cashed out in the secondary market after applying for new shares at the time of issuance, forming a fixed special interest group mainly focused on “new development”. Many large institutions also Participating in it caused the price of listed stocks to be seized in advance, and the performance of the secondary market was not optimistic. In the future, the reform of the new share purchase mechanism will further cancel the administrative restrictions on the issue price, and the situation of making quick profits in the secondary market through “new offerings” may change.
Only after the comprehensive market-oriented reform of the issuance system can the privileged capital benefit from privileges in the stock market be curbed, and the market return to a real market player. tend to be rational.
In the future, the registration system needs to cooperate closely with basic systems such as judicial retrospective, compensation mechanism, class action system and strict delisting mechanism, otherwise the effect of the registration system will be compromised. (Fortune Chinese website)
The author, Su Peike, is a columnist of Fortune Chinese Network, chief researcher of University of International Business and Economics and Public Policy Research Institute of University of International Business and Economics, director of Huaxia Sixiang Think Tank Special Committee
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Editor: Du Xiaolei
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