Site icon China Economic Review

CSRC planning new IPO rules

The China Securities Regulatory Commission (CSRC) announced that no new initial public offererings would be allowed until regulations aimed at setting reasonable offering prices are finalized. The rule changes were posted in draft form on the CSRC website and the CSRC has invited comments on them. The new rules come after the National Peoples Congress passed amendments to the Securities Law which give the market control over IPO prices. Prices for new IPOs will be set through bidding between financial institutions. The new laws would give a 20% allocation to institutional investors for offerings below 400 million shares and 50% allocations to them for offerings over 400 million shares. The shares sold to institutions would be subject to a three month lock-down period. Analysts said that the CSRC is attempting to give the markets more credibility and reinvigorate them after a three-year slump.

Exit mobile version