Rules set for sci-tech innovation board

Source: Xinhua | 2019-03-04

China’s top securities regulator released regulations on the science and technology innovation board, which pilots registration-based initial public offerings system, a major reform step for China’s capital market.

The regulations, to be implemented on a trial basis, took effect on March 1, the China Securities Regulatory Commission said on Friday.

The new sci-tech board in the Shanghai Stock Exchange focuses on companies in high-tech and strategically emerging sectors such as new generation information technology, advanced equipment, new materials and energy, and biomedicine, according to the CSRC.

Under the pilot registration system, eligible companies can become listed by filing required documents.

Currently, new shares of the A-share market are subject to approval from the securities watchdog.

The new board is crucial in optimizing the multi-tiered capital market system and enhancing the capital market’s capability to serve the real economy and facilitate the cause of building Shanghai into an international financial center and science and technology innovation hub, the SSE said on its website.

The registration-based initial public offerings system is a good attempt and will benefit A-share markets in the coming days, Henry Huang, professor with Sy Syms School of Business, Yeshiva University, said.

But he argued that the requirements for qualified investors in the sci-tech innovation board somehow have limited investment activities of individual investors. “I think the restrictions should be loosened in the future so all investors will enjoy the opportunities to invest in quality enterprises,” said Huang.