The Shenzhen Stock Exchange issued Guidance No. 8 on the Review of Initial Public Offerings and Listings of Shenzhen-listed Stocks, clarifying the criteria for determining light assets and high research and development investment.

On June 30, the Shenzhen Stock Exchange issued the "Shenzhen Stock Exchange Stock Issuance and Listing Review Business Guidelines No. 8 - Criteria for Identifying Companies with Light Assets and High Research and Development Investment", which came into effect on the day of its publication. The guidelines consist of 13 articles, specifying the scope of application, specific criteria for identifying companies with "light assets, high research and development investment", negative situations, disclosure requirements, verification requirements, and fundraising supervision requirements. The main contents are as follows: First, clarify the scope of application. It specifies that the criteria for identifying companies with "light assets, high research and development investment" as outlined in the guidelines apply to start-up board companies with characteristics of light assets and high research and development investment. Second, refine the identification criteria. Based on the concept of companies with characteristics of "light assets, high research and development investment" proposed in Opinion 18, the guidelines further refine and clarify the specific criteria for identifying companies with "light assets, high research and development investment". For example, "light assets" refers to the proportion of fixed assets and other physical assets at the end of the most recent year not exceeding 20% of total assets; "high research and development investment" refers to the proportion of average research and development investment to operating income not less than 15% in the last three years, or cumulative research and development investment not less than 3 billion yuan in the last three years with an average research and development investment not less than 3% of operating income. Third, establish negative conditions. It specifies that if a company's stock is subject to delisting risk warnings or other risk warnings, the proportion of fundraising for supplementing working capital and repaying debt should not exceed 30% of the total fundraising amount. Fourth, strengthen disclosure requirements. Companies are required to disclose in the fundraising prospectus the company's compliance with the requirements related to "light assets, high research and development investment", the rationale for exceeding the 30% limit for supplementing working capital and repaying debt, and strengthen the disclosure of information related to research and development expenditures, content, risks, and relevance to the fundraising projects. Fifth, enhance the responsibilities of intermediary institutions. It specifies that the sponsor and reporting accountant should focus on and verify matters related to the identification of companies with "light assets, high research and development investment", and provide specialized verification opinions. Sixth, strengthen fundraising supervision. Companies should disclose the use of funds raised and the progress of research and development projects in annual reports and pre-fundraising permission reports. Supervision should be strengthened for any changes in the use of funds exceeding 30% of the fundraising amount for supplementing working capital and repaying debt. For the original Chinese text, refer to the official website of the Shenzhen Stock Exchange. Editor: Jiang Yuanhua.