Source: Beijing Daily
Original title: Focusing on small and medium-sized enterprises, exploring the path of technological innovation and inclusive finance
With the opening of the China International Trade in Services Fair in 2021, the Beijing Stock Exchange (abbreviated as the Beijing Stock Exchange) turned out. The Beijing Stock Exchange will be built into an exchange tailored for innovative small and medium-sized enterprises, and explore the path of inclusive finance that supports the NEEQ and serves the technological innovation of small and medium-sized enterprises.
How does the Beijing Stock Exchange develop in a dislocation with the Shanghai and Shenzhen Stock Exchange? How will a series of basic systems such as issuance, trading, transfer and delisting be arranged? On September 3, the China Securities Regulatory Commission held a regular press conference to solicit public opinions on the relevant basic institutional arrangements of the Beijing Stock Exchange and interpret relevant important issues.
Serving earlier, smaller, and newer enterprises
In terms of market functions, the Beijing Stock Exchange focuses on innovative small and medium-sized enterprises and serves “earlier, smaller, and newer” clients. In terms of institutional arrangements, the Beijing Stock Exchange will insist that listed companies emerge from qualified innovative enterprises. At the same time, the Beijing Stock Exchange will also adhere to the transfer mechanism to the Shanghai and Shenzhen Stock Exchanges, give full play to its role as a link, and strengthen the interconnection of multi-level capital markets. In terms of market operation, the Beijing Stock Exchange insists on focusing on qualified investors. The investor structure and risk appetite are quite different from those of Shanghai and Shenzhen transactions, which match the risk characteristics of innovative small and medium-sized enterprises.
In the future, how will the Beijing Stock Exchange develop coordinated development with the basic and innovative layers of the NEEQ? Xu Ming, chairman of the National Equities Exchange and Quotations, stated that after the establishment of the Beijing Stock Exchange, the National Equities Exchange and Quotations will be managed by the National Equity Exchange and will continue to coordinate and coordinate with the innovation and basic levels to maintain a balanced market structure.
The Beijing Stock Exchange undertakes innovative small and medium-sized enterprises that have grown at the innovation and basic levels, mainly providing more efficient open market financing and transaction services, and stimulating the overall vitality of the NEEQ. The innovation layer and the basic layer are the source of listed companies on the Beijing Stock Exchange. They mainly cultivate and regulate SMEs of different growth stages and types, provide more inclusive and accurate market services, and promote SMEs to become familiar with and enter capital earlier. Market, enhance the awareness of information disclosure, cultivate corporate governance culture, use direct financing for continuous growth, and continuously provide high-quality listing resources to the Beijing Stock Exchange.
In terms of market connection, the Beijing Stock Exchange will strengthen the organic connection of multi-level capital markets and enrich the growth path of the company. Cultivate and grow companies at the innovative and basic levels of the New Third Board, encourage continued listing on the Beijing Stock Exchange, and at the same time adhere to the transfer mechanism, and cultivate mature companies listed on the Beijing Stock Exchange can choose to continue their development on the Shanghai and Shenzhen Stock Exchanges.
The basic system is generally shifted to the selected layers of the New Third Board
Zhou Guihua, Director of the Public Company Department of the China Securities Regulatory Commission, introduced that the Beijing Stock Exchange will generally shift a series of basic systems such as listing, trading, transfer, and delisting on the NEEQ Selected Layer, highlighting the market positioning of the Beijing Stock Exchange for serving innovative small and medium-sized enterprises. Different from the Shanghai and Shenzhen Stock Exchange’s issuance and listing system arrangements.
At present, the NEEQ has formed three market levels, namely the basic level, the innovation level and the selection level. Through the establishment of the Beijing Stock Exchange, the reform will take over the selection layer as a whole, and all existing listed companies on the selection layer will be converted into listed companies on the Beijing Stock Exchange.
Why set up the Beijing Stock Exchange on the basis of selected layers? The China Securities Regulatory Commission stated that since the opening of the market on July 27, 2020, the selection layer has attracted a group of “small and beautiful” high-quality small and medium-sized enterprises. The market has performed well and has the institutional and corporate foundations for the establishment of the Beijing Stock Exchange. And market fundamentals.
In terms of the issuance system, the Beijing Stock Exchange will highlight the characteristics of expertise, precision, speciality, and newness, and clarify simple, tolerant and precise issuance conditions. The draft for comments clarified that the newly-listed company on the Beijing Stock Exchange should be an innovative-tier listed company that has been listed in the National Equity Exchange System for 12 consecutive months. In addition, the Beijing Stock Exchange will also pilot the registration system, and the various institutional arrangements will be consistent with the science and technology innovation board and the ChiNext board to enhance transparency and predictability.
In terms of continuous financing, the Beijing Stock Exchange will focus on the needs of small and medium-sized enterprises, summarize the experience of selected layers, consolidate a small, fast, flexible and diversified refinancing system, and form a wealth of financing tools such as ordinary shares, preferred shares, and convertible bonds. In terms of continuous supervision, a continuous supervision system that is moderately lenient and strict and fits the characteristics of small and medium-sized enterprises will be established. At the same time, strengthen supervision and law enforcement, consolidate the main responsibility, and improve the quality of listed companies.
Beijing Stock Exchange will be funded and established by the National Equities Exchanger
A series of basic systems also include transaction systems. The Beijing Stock Exchange adheres to a more flexible trading system at the select level and implements continuous bidding transactions. There is no price limit on the first day of listing of new stocks, and the price limit is 30% from the next day to increase market flexibility. Adhere to the appropriate investor suitability management system, promote the balance of trading power, and prevent market speculation.
The Beijing Stock Exchange will form a market ecology of “in and out” and “in and out”, build a diversified delisting indicator system, improve the regular delisting and immediate delisting system, and strengthen the market clearing function. Establish differentiated exit arrangements. Delisting companies that meet the conditions can return to the innovation layer or the basic layer to continue trading. If there are major violations of laws and regulations, they will be directly delisted.
In terms of organizational structure, unlike the Shanghai and Shenzhen membership-based exchanges, the Beijing Stock Exchange will be funded and established by the National Equities Exchange, and will explore distinctive organizational forms and management systems. From the perspective of market structure, the National Equities Exchange and Quotations Co., Ltd. coordinates the construction and development of the NEEQ innovation layer, the basic layer and the Beijing Stock Exchange, and implements “integrated management and independent operation.”
From the perspective of the management system, the Beijing Stock Exchange adopts a company system. According to the “Company Law”, “Securities Law”, “Stock Exchange Management Measures” and other relevant regulations, it can learn from the best practices of mature international exchanges, continuously optimize the governance mechanism, and strengthen the party. The construction of the exchange, the improvement of governance capabilities, the formation of a transparent, efficient, and clean governance culture, and the accumulation of experience in various forms of reform of the exchange.
The China Securities Regulatory Commission stated that in the future, it will step up the establishment of the Beijing Stock Exchange’s issuance and listing, information disclosure and other institutional systems, and make technical preparations to ensure the smooth opening of the Beijing Stock Exchange. It will promptly complete the establishment of the main body of the Beijing Stock Exchange, complete the industrial and commercial registration as soon as possible, and establish and improve the exchange’s corporate governance structure. (Sun Jie)
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