Thursday March 17 2016
News Source: Global Exchanges
Focus: Listing Rules
Type: General
Country: Hong Kong
Link: http://www.hkex.com.hk/eng/rulesreg/listrules/listsptop/listoc/Documents/cg_japan.pdf
On 17th March 2016, Hong Kong Exchanges and Clearing Limited (HKEX) published a guide on their treatment of listing applications from Japanese incorporated issuers. The aim of this guide is to enhance applicants’ understanding of our expectations, practices, procedures and the criteria we consider when applying the Rules for overseas issuers.
Subject to Japan incorporated companies meeting the conditions set out in the guide, HKEX does not consider Japan’s shareholder protection standards to be materially different to that of Hong Kong. Japan meets HKEX’s international regulatory co-operation requirements as it already has adequate measures in place with the Hong Kong’s Securities and Futures Commission.
HKEX has stated that it is prepared to consider waivers from strict compliance with the Rules on abstention from voting by shareholders with a material interest in a transaction. This is if the issuer meets certain conditions for voting on a transaction where shareholders’ approval is required.
Additionally, they are also prepared to consider other waivers from strict compliance with HKEX Rules. These waivers may be conditional on the issuer giving undertakings to comply with certain requirements set out in the guide.
HKEX will accept financial statements that conform to Japanese Generally Accepted Accounting Principles from issuers with, or seeking, a dual primary or secondary listing. These must contain a statement of the financial effect of the material differences (if any) from either Hong Kong Financial Reporting Standards or International Financial Reporting Standards.
Furthermore, a Japanese issuer that issues bearer shares must explain the risks of holding these shares in certificated form on its share certificate. It must also adopt an internal rule that any person seeking to have his name recorded in its Hong Kong branch share register must present share transfer forms.
Finally, HKEX expects a Japanese issuer to prominently and fully disclose in its listing document details of all Japanese tax on gains from sales of securities, inheritance and gift taxes applicable to Hong Kong shareholders.
Click on the link above for further details.