Tuesday June 2 2015

News Source: Global Exchanges

Focus: Listing Rules

Type: General




The Shanghai Stock Exchange (SSE) has released the “Rules for Corporate Bonds’ Listing (Revised in 2015)” (the Rules), the “Provisional Measures on Business Administration of Non-public Issuance of Corporate Bonds” (the Provisional Measures) and the “Measures on Investor Suitability Management in Bond Market” (the Measures), in a bid to cement management on corporate bonds’ listing, protect legitimate rights and interests of investors and facilitate sustainable growth of the corporate bond market.

The main contents of the supporting rules include the following information:

About the Rules. The Rules standardizes the listing of publicly issued corporate bonds:

  • bond categorization and dynamic management are strengthened; 
  • responsibilities of professional agencies including underwriters are stressed and clarified; 
  • listing procedure is simplified; 
  • efforts are made to cement information disclosure management and optimize information disclosure procedure; 
  • regulation on bond’s duration is intensified to protect legitimate rights and interests of investors; 
  • self-regulatory system is perfected, and in-process and aftermath regulation are strengthened as well.

About the Provisional Measures. The SSE has formulated the Provisional Measures on the basis of the existing rules for private placement bonds, in a bid to standardize transfer of non-publicly issued bonds, with main contents as follows:

  • transfer procedure is simplified; 
  • features of private placement bonds are highlighted, and the regulatory system is consummated; 
  • differences of special bond products are emphasized to boost the growth of the private placement bond market.

About the Measures. According to relevant categorization standard in the “Management Measures on Issuance and Trading of Corporate Bonds”, the Measures is formulated after the SSE’s former requirements for investor suitability are rationalized, integrated and revised. The revised contents are as follows:

  • standard of professional investors is cancelled while that of qualified investors is put into force; 
  • scope of the bonds in which investors may invest is specified; 
  • the investor suitability management is perfected, and the channel for reporting and filing the name list is specified.

About arrangement for the systematic transitions of stock corporate bonds. The notice of releasing the 3 supporting rules has specified relevant systematic transitions of stock corporate bonds. The main contents are as follows:

  • underwriters, trustees and other professional agencies of stock corporate bonds should fulfill duties and obligations according to the new rules; 
  • the bond risk alert system will not be implemented; 
  • pre-issuance filing will not be carried out for former SMEs private placement bonds, securities companies’ short-term corporate bonds, and private placement bonds for mergers, acquisitions and reorganizations; 
  • about the systematic transition of investor suitability. The requirement for the investor suitability of the former stock corporate bonds that ordinary investors are allowed to buy remains unchanged, while that of other stock corporate bonds is adjusted to be qualified investors or qualified institutional investors.

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