Administrative Measures for the Acquisitions of Non-listed Public Companies (Amended in 2025)
Administrative Measures for the Acquisitions of Non-listed Public Companies (Amended in 2025)
Administrative Measures for the Acquisitions of Non-listed Public Companies (Amended in 2025)
Order of the China Securities Regulatory Commission No. 227
March 27, 2025
(Adopted upon deliberation at the 41st chairman's executive meeting of the China Securities Regulatory Commission on May 5, 2014; amended according to the Decision of the China Securities Regulatory Commission on Revising Some Securities and Futures Rules on March 20, 2020; and amended according to the Decision of the China Securities Regulatory Commission on Revising Certain Securities and Futures Rules on February 19, 2025)
Chapter I General Provisions
Article 1 In order to standardize the acquisitions and related share equity changes of non-listed public companies (hereinafter referred to as "public companies"), protect the legitimate rights and interests of public companies and investors, maintain the order of the securities market and the public interest, and promote the optimization and allocation of the sources of the securities market, these Measures are formulated according to the Securities Law, the Company Law, the Decision of the State Council on Issues Concerning National Equities Exchange and Quotations, the Opinions of the State Council on Further Optimizing the Market Environment for the Merger and Restructuring of Enterprises and other relevant laws and administrative regulations.
Article 2 With regard to public companies whose stock is publicly transferred via the National Equities Exchange and Quotations (hereinafter referred to as the "NEEQ"), the acquisitions and related share equity changes thereof shall comply with these Measures.
Article 3 The acquisitions and related share equity changes of public companies must comply with the laws, administrative regulations and the provisions of the China Securities Regulatory Commission (hereinafter referred to as the "CSRC"), and follow the principles of openness, impartiality and fairness. The parties shall act in good faith, abide by social morality and business ethics, voluntarily maintain the order of the securities market and accept the supervision from the government and the public.
Article 4 The acquisitions and related share equity changes of a public company involving the matters such as national industry policy, admittance into industries, transfer of State-owned shares and foreign investment which require the approval of relevant departments of the State shall be conducted after such approval is obtained.
Article 5 An acquirer may become the controlling shareholder of a public company by means of obtaining shares, may become the actual controller of a public company through the way of investment relation, agreement or other arrangement, or may also obtain the control right of a public company by both of the above ways and methods.
Such acquirer includes investors and their concerted actors.
Article 6 In acquiring a public company, the acquirer and its actual controller shall have a good credit record, and shall have a sound corporate governance mechanism if they are legal persons. No one may use the acquisition of a public company to damage the legitimate rights and interests of the acquired company and its shareholders.
A public company shall not be acquired under any of the following circumstances:
(1) the acquirer has a large amount of liabilities and fails to pay off the liabilities that are due but not paid, which is in an ongoing situation;
(2) the acquirer has committed a major illegal act or has been suspected of committing a major illegal act in the past two years;
(3) the acquirer has committed a serous faith breaking in the securities market in the past two years;
(4) where the acquirer is a natural person, it is under the circumstances specified in Article 178 of the Company Law; and
(5) other circumstances specified in the laws and administrative regulations and recognized by the CSRC which the acquisition of a public company is not allowed.
Article 7 The controlling shareholder or actual controller of an acquired company shall not abuse shareholder's rights to damage the legitimate rights and interests of the acquired company or other shareholders.
Where the controlling shareholder or actual controller of the acquired company or a related party thereof damages the legitimate rights and interests of the acquired company or other shareholders, the said controlling shareholder or actual controller shall remove such damage before transferring the control right of the acquired company. If such damage fails to be removed, they shall arrange the revenue from the transfer of relevant shares to remove all the damage, or shall provide full and effective performance guarantee or arrangement for the part that such revenue is not sufficient to removed, and submit such guarantee or arrangement to the shareholders' meeting of the acquired company for deliberation and adoption, and the controlling shareholder or actual controller of the acquired company shall withdraw from the vote on such matter.
Article 8 The directors, supervisors and senior managers of an acquired company have the duty of loyalty and duty of diligence for the company, and shall treat all the acquirers of the company fairly.
The decisions made or measures taken by the board of directors of the acquired company in respect of the acquisition shall be conducive to maintaining the interests of the company and its shareholders. The board of directors shall not abuse its power to set an inappropriate barrier for the acquisition, or shall not damage the interests of the company by using the resources of the company to provide the financial aid in any way to the acquirer.
Article 9 Where an acquirer acquires a public company according to the provisions of Chapter III or IV hereof, it shall appoint a professional institution with the financial advisor qualification to act as a financial advisor, except where the shares are obtained through administrative transfer or change of State-owned shares or due to succession, the shares are transferred between different subjects under the same actual controller, new shares that the public company issues thereto are obtained, the acquirer becomes or is to become the largest shareholder or actual controller of the public company due to a judicial decision.
The financial advisor appointed by an acquirer shall perform due diligence, abide by the professional norms and ethics, be independent, give instruction to the acquirer, and help the acquirer comprehensively assess the financial and operation standings of the acquired company; conduct due diligence on relevant information of the acquirer, and fully check and verify the documents disclosed by the acquirer; and publish a professional opinion on acquisition matters in an objective and impartial manner and guarantee the authenticity, accuracy and completeness of the documents that such advisor prepares and issues.
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Order of the China Securities Regulatory Commission No. 227
March 27, 2025
(Adopted upon deliberation at the 41st chairman's executive meeting of the China Securities Regulatory Commission on May 5, 2014; amended according to the Decision of the China Securities Regulatory Commission on Revising Some Securities and Futures Rules on March 20, 2020; and amended according to the Decision of the China Securities Regulatory Commission on Revising Certain Securities and Futures Rules on February 19, 2025)
Chapter I General Provisions
Article 1 In order to standardize the acquisitions and related share equity changes of non-listed public companies (hereinafter referred to as "public companies"), protect the legitimate rights and interests of public companies and investors, maintain the order of the securities market and the public interest, and promote the optimization and allocation of the sources of the securities market, these Measures are formulated according to the Securities Law, the Company Law, the Decision of the State Council on Issues Concerning National Equities Exchange and Quotations, the Opinions of the State Council on Further Optimizing the Market Environment for the Merger and Restructuring of Enterprises and other relevant laws and administrative regulations.
Article 2 With regard to public companies whose stock is publicly transferred via the National Equities Exchange and Quotations (hereinafter referred to as the "NEEQ"), the acquisitions and related share equity changes thereof shall comply with these Measures.
Article 3 The acquisitions and related share equity changes of public companies must comply with the laws, administrative regulations and the provisions of the China Securities Regulatory Commission (hereinafter referred to as the "CSRC"), and follow the principles of openness, impartiality and fairness. The parties shall act in good faith, abide by social morality and business ethics, voluntarily maintain the order of the securities market and accept the supervision from the government and the public.
Article 4 The acquisitions and related share equity changes of a public company involving the matters such as national industry policy, admittance into industries, transfer of State-owned shares and foreign investment which require the approval of relevant departments of the State shall be conducted after such approval is obtained.
Article 5 An acquirer may become the controlling shareholder of a public company by means of obtaining shares, may become the actual controller of a public company through the way of investment relation, agreement or other arrangement, or may also obtain the control right of a public company by both of the above ways and methods.
Such acquirer includes investors and their concerted actors.
Article 6 In acquiring a public company, the acquirer and its actual controller shall have a good credit record, and shall have a sound corporate governance mechanism if they are legal persons. No one may use the acquisition of a public company to damage the legitimate rights and interests of the acquired company and its shareholders.
A public company shall not be acquired under any of the following circumstances:
(1) the acquirer has a large amount of liabilities and fails to pay off the liabilities that are due but not paid, which is in an ongoing situation;
(2) the acquirer has committed a major illegal act or has been suspected of committing a major illegal act in the past two years;
(3) the acquirer has committed a serous faith breaking in the securities market in the past two years;
(4) where the acquirer is a natural person, it is under the circumstances specified in Article 178 of the Company Law; and
(5) other circumstances specified in the laws and administrative regulations and recognized by the CSRC which the acquisition of a public company is not allowed.
Article 7 The controlling shareholder or actual controller of an acquired company shall not abuse shareholder's rights to damage the legitimate rights and interests of the acquired company or other shareholders.
Where the controlling shareholder or actual controller of the acquired company or a related party thereof damages the legitimate rights and interests of the acquired company or other shareholders, the said controlling shareholder or actual controller shall remove such damage before transferring the control right of the acquired company. If such damage fails to be removed, they shall arrange the revenue from the transfer of relevant shares to remove all the damage, or shall provide full and effective performance guarantee or arrangement for the part that such revenue is not sufficient to removed, and submit such guarantee or arrangement to the shareholders' meeting of the acquired company for deliberation and adoption, and the controlling shareholder or actual controller of the acquired company shall withdraw from the vote on such matter.
Article 8 The directors, supervisors and senior managers of an acquired company have the duty of loyalty and duty of diligence for the company, and shall treat all the acquirers of the company fairly.
The decisions made or measures taken by the board of directors of the acquired company in respect of the acquisition shall be conducive to maintaining the interests of the company and its shareholders. The board of directors shall not abuse its power to set an inappropriate barrier for the acquisition, or shall not damage the interests of the company by using the resources of the company to provide the financial aid in any way to the acquirer.
Article 9 Where an acquirer acquires a public company according to the provisions of Chapter III or IV hereof, it shall appoint a professional institution with the financial advisor qualification to act as a financial advisor, except where the shares are obtained through administrative transfer or change of State-owned shares or due to succession, the shares are transferred between different subjects under the same actual controller, new shares that the public company issues thereto are obtained, the acquirer becomes or is to become the largest shareholder or actual controller of the public company due to a judicial decision.
The financial advisor appointed by an acquirer shall perform due diligence, abide by the professional norms and ethics, be independent, give instruction to the acquirer, and help the acquirer comprehensively assess the financial and operation standings of the acquired company; conduct due diligence on relevant information of the acquirer, and fully check and verify the documents disclosed by the acquirer; and publish a professional opinion on acquisition matters in an objective and impartial manner and guarantee the authenticity, accuracy and completeness of the documents that such advisor prepares and issues.
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