Interim Administrative Measures for the Issuance of Securities of Listed Companies on the Growth Enterprise Market
Interim Administrative Measures for the Issuance of Securities of Listed Companies on the Growth Enterprise Market
Interim Administrative Measures for the Issuance of Securities of Listed Companies on the Growth
Order of the
May 14, 2014
The Interim Administrative Measures for the Issuance of Securities of Listed Companies on the Growth Enterprise Market which were deliberated and adopted at the 26th executive meeting of the Chairman of the China Securities Regulatory Commission on February 11, 2014 are hereby promulgated and become effective as of the day of promulgation.
Chairman of the
Interim Administrative Measures for the Issuance of Securities of Listed Companies on the Growth
Chapter I General Provisions
Article 1 In order to standardize the securities issuance of the companies listed on the Growth Enterprise Market (GEM) (hereinafter referred to as listed companies) and protect the legitimate rights and interests of investors the public interest, these Measures are formulated according to the Securities Law and the Company Law.
Article 2 Where a listed company applies for domestic issuance of securities, these Measures apply.
In these Measures, securities refer to the following verities of securities:
1. stocks;
2. convertible corporate bonds; and
3. other varieties recognized by the China Securities Regulatory Commission (hereinafter referred to as the "CSRC").
Article 3 A listed company may conduct public issuance of securities to non-particular objects or non-public issuance of securities to particular objects.
Article 4 When issuing securities, the listed company must disclose or provide information in an authentic, accurate, complete, timely and fair manner, and shall not make any false or misleading statement or significant omission.
As the primary obligator of information disclosure, the listed company shall timely provide to a sponsor or securities service institution the financial and accounting materials and other materials to fully cooperate on due diligence performed by the sponsor or securities service institution.
Article 5 A sponsor shall strictly perform statutory duties, observe operational rules and industry standards, prudently examine the application documents of the listed companies sponsored and the professional advices issued by securities service institutions, supervise and guide the standard operation of listed companies, make a professional judgment on whether or not a listed company is sustainably profitable or meets the issuance requirements, and ensure that the sponsor letters for issuance as issued and the application documents of listed companies are authentic, accurate, complete and timely.
Article 6 Securities service institutions and personnel that issue documents for securities issuance shall strictly perform statutory duties, observe the operation standards and the code of practice of their industry, examine and verify relevant operation materials of listed companies, and ensure that the professional documents as issued are authentic, accurate, complete and timely.
Article 7 A listed company shall establish an investor protection mechanism, optimize the investment return mechanism, guarantee investors' rights to stay informed about, participate in relevant affairs, and effectively protect the legitimate rights and interests of investors, especially small and medium investors.
Article 8 The approval of the CSRC for the securities issuance of a listed company does not mean that it makes substantive judgment or guarantee in respect of the investment value of such securities or the profits of investors. Investors shall judge the investment value of a listed company on their own and make an investment decision, and independently undertake the investment risk resulting from the change in the operation and profit of the listed company.
Chapter II Requirements for Securities Issuance
Section 1 General Provisions
Article 9 To issue securities, the listed company shall meet the requirements specified in the Securities Law, and comply with the following provisions:
1. it has been in a favorable balance for the past two years, and the net profit is calculated based on the recurrent profit and loss before or after being excluded, whichever is smaller;
2. its basic accounting is standard and its business outcomes are real. Its internal control system is sound and is effectively implemented, which can reasonably guarantee the reliability of the company's financial reports, the legality of its production and business operation, and its operating efficiency and result;
3. cash bonus has been implemented in the past two years according to the articles of association of the listed company;
4. for the financial statements of the past three years and the past one period, there should be no audit report with negative opinions as issued by certified accountants or on which it is difficult for certified accountant to express their opinions; if an audit report with reserved opinions or no reserved opinions but containing emphasized matters is issued by a certified public accountant, the matters involved must have no seriously unfavorable effect on the issuer of securities or the seriously unfavorable effect must have been eliminated prior to the securities issuance;
5. the asset-liability ratio at the end of the past one period is higher than 45%, except for the non-public issuance of stocks of the listed company; and
6. the listed company is separated from its controlling shareholder or actually controller in terms of personnel, assets and financial affairs, is independent in establishments and operations, and is able to independently carry out its business operation and management. Within the past 12 months, the listed company must not provide any illegal guarantee to an outsider or its funds must not be misappropriated by its controlling shareholder or actual controller or other controlled enterprises thereof by means of loan, replacement of debt repayment, advance payment or any other means.
Article 10 A listed company shall not issue securities under any of the following circumstances:
1. the application documents for the issuance contain any false or misleading statement or significant omission;
2. the listed company has failed to publicly make a commitment to investors in the past 12 months;
3. in the past 36 months, the listed company has been administratively penalized due to violation of the laws, administrative regulations or rules and the case is serious, or the listed company has been criminally penalized, or been administratively penalized by the CSRC due to violation of the securities laws, administrative regulations or rules; the listed company has been publicly censured by the stock exchange in the past 12 months; or a case has been put on file by the judicial authority for investigation over the listed company for being suspected of committing a crime or by the CSRC for investigation over the listed company for being suspected of involving any illegality or irregularity;
4. any controlling shareholder or actual controller of the listed company has been administratively penalized by the CSRC or criminally penalized due to violation of the securities laws, administrative regulations or rules in the past 12 months;
5. any current director, supervisor or senior executive of the listed company violates Article 147 or 148 of the Company Law, or has been administratively penalized by the CSRC in the past 36 months or publicly censured by the stock exchange in the past 12 months; or a case has been put on file by the judicial authority for investigation over him or her for being suspected of committing a crime or by the CSRC for investigation over him or her for being suspected of any illegality or irregularity; and
6.
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