China Securities Regulatory Commission issues "Opinions on Deepening Market Reform of Listed Companies' Mergers and Acquisitions"

The China Securities Regulatory Commission has conducted extensive research and formulated the "Opinions on Deepening the Reform of the Market for Mergers and Acquisitions of Listed Companies" based on the research. It points out the support for listed companies to transition and upgrade towards new productive forces. The commission will actively support listed companies in mergers and acquisitions around strategic emerging industries, future industries, etc., including cross-industry mergers and acquisitions based on transformation and upgrading goals, acquisitions of non-profitable assets that help strengthen and improve key technology levels, and support for the merger of upstream and downstream assets in the "innovation and creation" sector, guiding more resources to converge towards new productive forces. Encouraging listed companies to strengthen industrial integration. While the capital market supports the development of emerging industries, it will continue to help traditional industries to reasonably increase industrial concentration and improve resource allocation efficiency through reorganization. For the integration needs among listed companies, support will be provided through improving restricted sale period regulations, significantly simplifying review procedures, etc. At the same time, the arrangement of locking period "reverse linkage" will encourage private equity funds to actively participate in mergers and acquisitions. In addition, further enhance regulatory tolerance. While respecting the rules, the commission will respect market laws, economic laws, and innovation laws, further enhancing tolerance for matters such as reorganization valuation, performance commitments, inter-industry competition, and related transactions, and better play the role of market optimization in resource allocation. Improving the efficiency of the reorganization market transactions. The original text is as follows: "The China Securities Regulatory Commission issued the 'Opinions on Deepening the Reform of the Market for Mergers and Acquisitions of Listed Companies' Mergers and acquisitions are important market tools to support economic transformation and upgrading and achieve high-quality development. The new 'Nine Articles of the State' has made important arrangements for the active mergers and acquisitions market. In order to further stimulate the vitality of the mergers and acquisitions market, the China Securities Regulatory Commission conducted extensive research and formulated the 'Opinions on Deepening the Reform of the Market for Mergers and Acquisitions of Listed Companies,' adhering to the direction of marketization, and better playing the role of the capital market as the main channel in corporate mergers and acquisitions. The main contents are as follows: First, support listed companies in transitioning and upgrading towards new productive forces. The Commission will actively support listed companies in mergers and acquisitions around strategic emerging industries, future industries, etc., including cross-industry mergers and acquisitions based on transformation and upgrading goals, acquisitions of non-profitable assets that help strengthen and improve key technology levels, and support for the merger of upstream and downstream assets in the 'innovation and creation' sector, guiding more resources to converge towards new productive forces. Second, encourage listed companies to strengthen industrial integration. While the capital market supports the development of emerging industries, it will continue to help traditional industries to reasonably increase industrial concentration and improve resource allocation efficiency. For the integration needs among listed companies, support will be provided through improving restricted sale period regulations, significantly simplifying review procedures, etc. At the same time, through arrangements such as locking period 'reverse linkage,' private equity funds are encouraged to actively participate in mergers and acquisitions. Third, further enhance regulatory tolerance. While respecting the rules, the commission will respect market laws, economic laws, and innovation laws, further enhancing tolerance for matters such as reorganization valuation, performance commitments, inter-industry competition, and related transactions, and better play the role of market optimization in resource allocation. Fourth, improve the efficiency of the reorganization market transactions. The Commission will support listed companies to issue shares and convertible bonds in stages according to transaction arrangements, pay transaction consideration in stages, and provide stage-matching financing to improve transaction flexibility and fund utilization efficiency. At the same time, establish a simple reorganization review procedure, greatly simplify the review process for listed companies that meet the conditions for reorganization, shorten the review period, and improve the efficiency of reorganization. Fifth, enhance the service level of intermediary institutions. An active mergers and acquisitions market cannot do without the function of intermediary institutions. The Commission will guide securities companies and other institutions to improve service capabilities, fully play the roles of transaction matching and professional services, and help listed companies implement high-quality mergers and acquisitions. Six, strengthen supervision in accordance with the law. The Commission will guide the parties to transactions to conduct mergers and acquisitions activities in accordance with regulations, strictly fulfill various legal obligations such as information disclosure, crack down on various illegal and irregular behaviors, effectively maintain the order of the reorganization market, and effectively protect the legitimate rights and interests of small and medium investors. To implement the 'Opinions on Deepening the Reform of the Market for Mergers and Acquisitions of Listed Companies,' the commission and the stock exchange have revised the 'Measures for the Administration of Major Asset Restructuring of Listed Companies' and other rules, and simultaneously solicited opinions publicly. This article is excerpted from the official website of the China Securities Regulatory Commission, GMTEight editor: Chen Xiaoyi."