SFC: listed companies assets Reorganization Act might be "quantitative supervision"

China Securities Regulatory Commission yesterday (28 May) published the page〈 initial public offering of shares and listing management > article 12 of the issuer in recent three years main business is not a major change of the applicable advice — the Securities and Futures law advice no. 3 (hereinafter referred to as the "appropriate advice"), under the same control people's behavior to be listed assets reorganization of a clear regulatory standards.

The industry pointed out that clear quantitative criteria, to support the issuer in the initial public offering of shares and listing before business reorganization and integration for overall IPO, specification of such restructuring Act.

According to the initial public offering of shares and listing management measures "the provisions of article 12, the issuer should be in the last 3 years (hereinafter referred to as the reporting period) main business has not changed significantly.

According to the Department of a large brokerage firms, previously responsible for the proposed reorganization is not expressly listed companies, generally listed mutatis mutandis to asset restructuring. In the implementation of "three years before the listing has no significant changes in the business", the industry practice is to be listed on the first episode of the proportion of assets reorganization should be controlled at 50% for judgment.

Under the new release of the applies this opinion, in the same company control people, is a party before the reorganization of the assets at the end of the fiscal year or the previous total fiscal year revenues or profits amounted to meet or exceed the corresponding project before the reorganization of 100% of the issuer, to help investors understand the reorganized issuer's overall operations, after running a fiscal year before applying for issuance.

Is party to a reorganization of the front end of the fiscal year or the total assets of the previous fiscal year, operating income or total profit reaches or exceeds the corresponding project before the reorganization of 50% of the issuer, but no more than 100% of the sponsor and the issuer's counsel should, in accordance with the relevant laws and regulations on the initial public offering of the body's requirements, will be reorganized party into due diligence and related delivered.

Is party to a reorganization of the front end of the fiscal year or the total assets of the previous fiscal year, operating income or total profit reaches or exceeds the corresponding project before the reorganization of 20% of the issuer, the reporting of financial statements must contain at least the recent reorganization of the completion of a balance sheet.

The applicable views clearly, is party to a fiscal year before the reorganization and restructuring transactions before the existence of the issuer, the total assets, total operating revenues or profits, in accordance with the deduction of the transaction after the calculated at constant prices. Issuer first request file to the previous fiscal year or a period of reorganization act occurred on many occasions, reorganizations, total assets of the issuer, the total amount of revenue or profits should be cumulative calculation of impact.

In the same control is part of the "people" of the judgment, the applies this opinion was of the view that is party shall report the beginning of the current period, and the same issuer of corporate control, if the control is being restructured during the reporting period, the newly established, it should be since the day it was founded the same with the issuer of corporate control control. At the same time, is entering the issuer's business and the business of the issuer before the reorganization has dependencies (the same, similar or same industry chain upstream and downstream), may be regarded as the main business has not changed significantly.

Supervisory authority finds that the issuer on the same person under the same corporate control, similar or related business to restructure, a consortium for the realization of the main business overall IPO, lower management costs, play business collaborative advantage, improve economies of scale and the implementation of market behavior. From the perspective of the capital market, the issuer prior to the IPO, the same company under the control of the person and the same issuer, similar or related business reorganization and integration, to avoid competition and reduce the associated transactions, optimization of corporate governance, ensure standardized operation, for improving the quality of listed companies, capital markets and optimize resource allocation function, the protection of investors, particularly small and medium-sized investors ' legal rights, promotion of healthy and stable development of the capital market, has a positive effect.