Editor's note: Recently, the rules regarding the establishment of the Science and Technology Innovation Board and the pilot registration system have been centrally released, and many investors are very concerned about this. In order to meet the needs of investors to understand the establishment of the Science and Technology Innovation Board and pilot the reform of the registration system, the Investor Protection Bureau of the China Securities Regulatory Commission and the Shanghai Stock Exchange have jointly launched the "Approaching Science and Technology Innovation, Walking with Us" Science and Technology Innovation Board Investment Education Column, continuously introducing investment knowledge on the Science and Technology Innovation Board, interpreting trading rules, revealing investment risks, and guiding investors to participate in trading rationally.
1. As a new trading sector, how do investors understand the positioning of the Science and Technology Innovation Board?
The Implementation Opinions on Establishing the Science and Technology Innovation Board and Pilot Registration System on the Shanghai Stock Exchange (hereinafter referred to as the "Implementation Opinions") stipulate the positioning of the Science and Technology Innovation Board, which is a goal and direction that must be firmly grasped in promoting the construction of the Science and Technology Innovation Board. To grasp the positioning of the Science and Technology Innovation Board at the execution level, it is necessary to respect the laws of technological innovation, capital market, and enterprise development. Technological innovation often has the characteristics of fast renewal, slow cultivation, and high risk, therefore it particularly requires the support of venture capital and capital markets. At the same time, many science and technology innovation enterprises in our country are in a critical period of climbing the slope and making progress. To grasp the positioning of the science and technology innovation board, it is necessary to handle the relationship between reality and goals, current and long-term. The Science and Technology Innovation Board is not only a display board for technology enterprises, but also a promotion board for promoting the development of technology innovation enterprises; The Science and Technology Innovation Board should prioritize supporting the development of new technologies and new industry enterprises, while also taking into account the development of high-quality enterprises with high market recognition in new models and new formats.
Based on the requirements of the Implementation Opinions and the actual market situation, the Shanghai Stock Exchange will mainly implement the positioning of the Science and Technology Innovation Board from four aspects in its specific work: firstly, in terms of institutional construction, by issuing guidelines for recommending the listing of enterprises on the Science and Technology Innovation Board, establishing a Science and Technology Innovation Advisory Committee and a Self discipline Committee for the Public Issuance of Stock on the Science and Technology Innovation Board, refining the requirements for recommendation verification, and strengthening professional checks and self discipline supervision mechanisms. Secondly, in terms of market mechanisms, a pilot investment system for subsidiaries of recommendation institutions should be implemented, and a practice evaluation mechanism should be established to further leverage the selection function of recommendation institutions for science and technology innovation enterprises through commercial and reputation constraints. Thirdly, in terms of audit arrangements, the issuer is required to carefully evaluate whether it meets the relevant industry scope, relies on core technology for production and operation, and has strong growth potential, taking into account the positioning of the Science and Technology Innovation Board; Require the sponsor to make professional judgments on whether the issuer meets the positioning of the Science and Technology Innovation Board. The Shanghai Stock Exchange will pay attention to whether the evaluation of the issuer is objective and whether the judgment of the sponsor is reasonable, and may consult with the Science and Technology Innovation Advisory Committee established by the Exchange as needed on whether the issuer meets the positioning of the Science and Technology Innovation Board. Fourthly, in terms of enterprise guidance, emphasis will be placed on key areas while taking into account general considerations. Priority should be given to supporting enterprises that comply with national strategies, possess key core technologies, have outstanding technological innovation capabilities, mainly rely on core technologies for production and operation, have stable business models, high market recognition, good social image, and strong growth potential. At the same time, it takes into account both new business models and enterprises, reflecting the inclusiveness of the Science and Technology Innovation Board.
2. How are the conditions for the issuance and listing of enterprises on the Science and Technology Innovation Board set?
The Science and Technology Innovation Board sets diversified and inclusive listing conditions based on the positioning of the sector and the characteristics of science and technology innovation enterprises, and facilitates the "import" of the market.
The relevant systems have streamlined and optimized the conditions for the issuance of the Science and Technology Innovation Board, and have stipulated the conditions for the initial public offering of the Science and Technology Innovation Board from four aspects: subject qualification, accounting and internal control, independence, and legal operation. The Listing Rules of the Shanghai Stock Exchange Science and Technology Innovation Board (hereinafter referred to as the Listing Rules) clarify multiple sets of conditions for listing on the Science and Technology Innovation Board in terms of total share capital, equity distribution, market value, financial indicators, and other aspects after issuance.
At the same time, in terms of market and financial conditions, the "market value" indicator has been introduced, combined with financial indicators such as income, cash flow, net profit, and research and development investment. Five sets of differentiated listing indicators have been set up, which can meet the listing needs of various scientific and technological innovation enterprises that have broken through core technologies or achieved phased results through continuous research and development investment in key areas, and have good development prospects, but have varying financial performance.
In addition, companies that meet the positioning of the Science and Technology Innovation Board, have not yet made profits or have accumulated outstanding losses are allowed to list on the Science and Technology Innovation Board, and special equity structured enterprises and red chip enterprises that meet relevant requirements are allowed to list on the Science and Technology Innovation Board.
3. What are the requirements for the market value and financial indicators in the listing conditions for issuers with voting rights differences to apply for listing on the Science and Technology Innovation Board?
If an issuer with voting rights differences applies for the initial public offering of stocks or depositary receipts and is listed on the Science and Technology Innovation Board, their voting rights arrangements shall comply with the provisions of the "Listing Rules for Stocks on the Science and Technology Innovation Board" and other rules; The issuer shall meet at least one of the following listing standards, and the issuer's prospectus and the sponsor's listing recommendation letter shall clearly state the specific listing standards chosen:
Firstly, the expected market value shall not be less than RMB 10 billion;
The second is that the expected market value is not less than RMB 5 billion, and the operating revenue in the past year is not less than RMB 500 million.
According to Article 131 of the Company Law, the issuer shall issue shares with special voting rights in addition to the general provisions of ordinary shares. Each special voting share has a greater number of voting rights than each ordinary share, and other shareholders have the same rights as ordinary shares.
4. What conditions do red chip enterprises need to meet when applying for the issuance of stocks or depositary receipts and listing on the Science and Technology Innovation Board?
Red chip enterprises that comply with the relevant provisions of the "Notice of the General Office of the State Council on Forwarding Several Opinions of the China Securities Regulatory Commission on Pilot Domestic Issuance of Stocks or Depositary Receipts by Innovative Enterprises" (Guo Ban Fa [2018] No. 21) can apply for issuance of stocks or depositary receipts and be listed on the Science and Technology Innovation Board.
For red chip enterprises that have rapidly increased operating revenue, possess independent research and development, international leading technology, and are in a relatively advantageous position in the same industry competition that have not yet been listed overseas, and apply to issue stocks or depositary receipts for listing on the Science and Technology Innovation Board, their market value and financial indicators should meet at least one of the following listing standards, The prospectus of the issuer and the listing recommendation letter of the sponsor should clearly state the specific listing standards chosen:
Firstly, the expected market value shall not be less than RMB 10 billion;
The second is that the expected market value is not less than RMB 5 billion, and the operating revenue in the past year is not less than RMB 500 million.
5. What is the review process for the issuance and listing of the Science and Technology Innovation Board under the registration system?
Unlike the approval system on the main board of the Shanghai Stock Exchange, the Science and Technology Innovation Board pilot implementation of a registration system for review. The initial public offering of stocks and their listing on the Science and Technology Innovation Board shall comply with the issuance conditions, listing conditions, and relevant information disclosure requirements, and shall be subject to the approval of the Shanghai Stock Exchange for issuance and listing in accordance with the law, and shall be reported to the China Securities Regulatory Commission for the completion of the issuance registration procedures.
6. What are the appropriate management requirements for investors to participate in stock trading on the Science and Technology Innovation Board?
According to the Special Regulations on Stock Trading on the Science and Technology Innovation Board of the Shanghai Stock Exchange, stock trading on the Science and Technology Innovation Board implements an investor suitability management system.
Institutional investors participating in stock trading on the Science and Technology Innovation Board should comply with laws and regulations as well as the business rules of the Shanghai Stock Exchange.
Individual investors participating in stock trading on the Science and Technology Innovation Board shall meet the following conditions:
Firstly, the daily average assets in the securities account and funds account within the 20 trading days prior to the application for permission to open shall not be less than RMB 500000 (excluding the funds and securities that the investor has received through margin trading and securities lending);
Secondly, participating in securities trading for more than 24 months;
The third is other conditions stipulated by the Shanghai Stock Exchange.
The Shanghai Stock Exchange may make adjustments to the above conditions based on market conditions.
Here, it is particularly important for investors to note that individual investors who do not meet the requirements of suitability management can participate in the Science and Technology Innovation Board investment through public funds and other means.
7. What special trading regulations do investors need to pay attention to when participating in stock trading on the Science and Technology Innovation Board?
The business model of enterprises on the Science and Technology Innovation Board is relatively new, with a high possibility of performance fluctuations and high uncertainty. In order to prevent excessive speculation and ensure liquidity in the market, the trading system of the Science and Technology Innovation Board introduces differentiated mechanisms such as appropriately relaxing the limit on rise and fall, adjusting the number of individual declarations, opening margin trading and securities lending on the first day of listing, and introducing fixed price trading after hours.
8. How should listed companies on the Science and Technology Innovation Board and relevant information disclosure obligors fulfill their information disclosure obligations?
Listed companies on the Science and Technology Innovation Board and information disclosure obligors shall promptly and fairly disclose all matters that may have a significant impact on securities trading prices or investment decisions, ensuring the truthfulness, accuracy, and completeness of the disclosed information, without any false records, misleading statements, or major omissions, and the information disclosure documents shall be complete and in a format that meets the prescribed requirements.
At the same time, science and technology innovation companies should fully disclose the operating information of their respective industries, as well as risk factors that may have a significant adverse impact on the company's core competitiveness, business activities, and future development, taking into account the characteristics of their respective industries.
9. Through what channels can investors read the relevant documents on information disclosure of companies listed on the Science and Technology Innovation Board?
Investors can learn about the information disclosure related documents of companies listed on the Science and Technology Innovation Board on the media designated by the China Securities Regulatory Commission. Listed companies and relevant information disclosure obligors shall not use other forms such as press releases or answering questions from journalists to replace information disclosure or disclose non-public significant information.
Listed companies and relevant information disclosure obligors may, if necessary, release the information that should be disclosed to the public during non trading hours through press conferences, media interviews, company websites, online self media, etc. However, the company should disclose the relevant information before the start of the next trading period.
10. What special regulations do investors need to pay attention to regarding the delisting system arrangement of the Science and Technology Innovation Board?
The delisting system of the Science and Technology Innovation Board fully draws on existing delisting practices. Compared to the main board of the Shanghai Stock Exchange, it is more strict, with a shorter delisting time and faster delisting speed.
In the case of delisting, the newly added market value is lower than the prescribed standards, and there are significant defects in the information disclosure or standardized operation of the listed company, resulting in delisting.
In terms of execution standards, listed companies that have significantly lost their ability to continue operations and rely solely on unrelated trade or related party transaction income without commercial substance may be delisted.
Remind investors to pay attention to the delisting risk of the Science and Technology Innovation Board.
Disclaimers
This information does not constitute any investment advice, and investors should not substitute such information for their independent judgment or make decisions solely based on such information. We strive for the accuracy and reliability of the information in this column, but we do not guarantee the accuracy or completeness of this information, and we do not assume any responsibility for any losses caused by the use of such information.
For more investment knowledge on the Science and Technology Innovation Board, please pay attention to the investor education website of Shanghai Stock Exchange (edu.sse. com. cn) and the "Shanghai Stock Exchange Investment Education" WeChat official account.
Article source: Shanghai Stock Exchange official website
