CSRC-related agencies intend to impose administrative penalties on Zhongneng Grain Science for its illegal acts in overseas listing filing.

On April 24th, the Heilongjiang Securities Regulatory Bureau issued a preliminary administrative penalty notification to Heilongjiang Zhongneng Grain Science and Agriculture Technology Co., Ltd. (referred to as Zhongneng Grain Science) and the intermediary institution Guangdong Xinyu Law Firm (referred to as Guangdong Xinyu) for their overseas listing violations. This case is the first case handled by the China Securities Regulatory Commission since the implementation of the "Interim Measures for the Administration of Domestic Enterprises' Overseas Issuance of Securities and Listing" in which a company conducted overseas listing without following the required procedures. On December 21, 2024, China Grain Investment Group Limited (later renamed as Grain Technology Innovation Biology (Hong Kong) Limited, referred to as "China Grain Investment") entrusted its domestic operating entity Zhongneng Grain Science to submit a filing report to the China Securities Regulatory Commission regarding the planned indirect listing on the NASDAQ Stock Exchange in the US through a De-SPAC merger transaction. The China Securities Regulatory Commission received the filing materials on March 6, 2025, and requested additional information. On October 1, 2025, without completing the overseas listing filing procedures, China Grain Investment listed on the NASDAQ Stock Exchange through a merger transaction with a special purpose acquisition company. Upon discovering this, the China Securities Regulatory Commission immediately notified the relevant US regulatory authorities and the exchange, and China Grain Investment was halted from trading on the listing day. Upon investigation, it was found that Zhongneng Grain Science had conducted overseas issuance and listing activities without following the required domestic enterprise overseas listing procedures, potentially violating the relevant provisions of the "Interim Measures." The Heilongjiang Securities Regulatory Bureau proposed a fine of 3 million yuan for Zhongneng Grain Science, a fine of 1.5 million yuan for the directly responsible person Jiang Zhenjun, a fine of 500,000 yuan for Guangdong Xinyu Law Firm, and a fine of 200,000 yuan for the lawyer Li Huabin. According to regulations, the relevant parties have the right to make statements, defend themselves, and request a hearing, and the Heilongjiang Securities Regulatory Bureau will make an official administrative penalty decision after completing the regulatory enforcement process in accordance with the law. The China Securities Regulatory Commission will continue to balance openness and security, support domestic enterprises in utilizing the "two markets, two resources" in compliance with the law to achieve high-quality development; strengthen regulatory enforcement on enterprises' overseas listing activities in accordance with the law, and continuously improve the standardization, compliance, and transparency of listing management; enhance cross-border cooperation with overseas regulatory agencies to jointly maintain market order and protect the legitimate rights and interests of investors. This article is selected from the WeChat public account "CSRC Announcement"; GMTEight Editor: Huang Xiaodong.