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China plans to lift profits-making IPO requirements in mainland

2015-01-19 16:03 Ecns.cn Web Editor: Mo Hong'e
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 Xiao Gang, chairman of the China Securities Regulatory Commission (CSRC) speaks at the Asian Financial Forum in Hong Kong, Jan 19, 2015. (Photo: Caixin.com)

Xiao Gang, chairman of the China Securities Regulatory Commission (CSRC) speaks at the Asian Financial Forum in Hong Kong, Jan 19, 2015. (Photo: Caixin.com)

(ECNS) -- China will continue to simplify procedures for companies who plan to go to public, including abolishing profit-making requirements, said Xiao Gang, chairman of the China Securities Regulatory Commission (CSRC).

He said at the Asian Financial Forum in Hong Kong on Monday that CSRC supports Chinese companies to issue IPOs in overseas markets and that the regulatory body has reduced the approval procedure from 13 items to 7, with further efforts ongoing.

In future, Chinese companies who want to list on the domestic market would not need to meet profits-making requirements related to the existing approval-based IPO system, according to Xiao.

China has promised to turn the nation's current approval-based system of initial public offerings into a "registration-based" equivalent. The State Council has also urged the lowering of thresholds for small and innovative companies to get listed on the stock market. 

Xiao said that the mainland and Hong Kong are facing great opportunities to intensify financial cooperation, including the liberalization of service trade and the securities market.

He called the Shanghai-Hong Kong Stock Connect, aimed at linking the stock exchanges of Hong Kong and Shanghai, an institutional innovation.

Investors from both sides still need time to get familiar with the system, it was added.

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