Shanghai Stock Exchange seeks public opinion on adjusting and updating the specific industry scope of key support for the Sci-Tech Innovation Board.

On June 17, in order to better guide eligible future industry enterprises to apply for listing on the Science and Technology Innovation Board (STAR Market), and to further enhance the inclusiveness and adaptability of the STAR Market, the Shanghai Stock Exchange revised and formed the "Provisional Regulations on the Application and Recommendation for Listing of Enterprises on the Science and Technology Innovation Board of the Shanghai Stock Exchange (Draft for Solicitation of Comments)" (referred to as the "Provisional Regulations"). The revisions adjust and update the specific industry scope supported by the STAR Market, adding new industries in the future industry sector, and strengthening the responsibilities of issuers and intermediary agencies. The revised content includes: first, adding new industries in the future industry sector. According to the "14th Five-Year Plan" outline and the classification requirements of strategic emerging industries, adjustments and updates have been made to the second-level industries of strategic emerging industries specified in Article 5 of the "Provisional Regulations". For example, in the field of new generation information technology, "quantum" has been added; in the field of high-end equipment, "Siasun Robot & Automation" has been added, and "marine engineering equipment" has been adjusted to "marine equipment"; in the field of new energy, "hydrogen energy" has been added; in the field of biomedicine, "brain-machine interface, biologics, genetic engineering drugs and vaccines, biomedical engineering," etc. have been added. Second, strengthening the responsibilities of issuers and intermediary agencies. It is required that issuers involved in industries related to the future industry sector should fully, objectively, and accurately disclose the current development stage, achieved milestones, and potential risks they may face in the prospectus and other disclosure documents. At the same time, intermediary agencies are urged to conduct comprehensive checks on the advancedness of issuers' technology and products, business models, market space, and clarify whether they meet the positioning requirements of the STAR Market. The original text is as follows: Provisional Regulations on Application for Listing of Enterprises on the Science and Technology Innovation Board of the Shanghai Stock Exchange (Solicitation Draft) Article 1 In order to further clarify the positioning criteria of the STAR Market, support and encourage enterprises in hard technology to list on the STAR Market, guide and standardize issuer applications and sponsor recommendations, promote the sustainable and healthy development of the STAR Market, these regulations are formulated in accordance with the "Implementation Opinions on Establishing the Science and Technology Innovation Board at the Shanghai Stock Exchange and Pilot Registration System," "Regulations on the Registration of Initial Public Offerings of Stocks," "Guidelines on Science and Technology Attributes Evaluation (Trial)", SSE Stock Issuance and Listing Review Rules and "SSE STAR Market Listing Rules". Article 2 Enterprises applying for listing on the STAR Market shall base their application on the science and technology attributes requirements in the "Guidelines" and these regulations to determine whether the issuer meets the positioning of the STAR Market. Issuers applying for listing on the STAR Market shall conduct a self-assessment of whether they meet the positioning of the STAR Market based on the science and technology attributes requirements in the "Guidelines" and these regulations. Sponsoring institutions recommending issuers to apply for listing on the STAR Market shall verify whether the issuers meet the science and technology attributes requirements related to the positioning of the STAR Market and make professional judgments. Article 3 The STAR Market is aimed at the world's technological frontier, the main economic battlefields, and the major national needs, mainly serving enterprises that meet the country's strategic needs, have key core technologies, outstanding technological innovation capabilities, mainly rely on core technologies to carry out production and operation, have prominent industry status or high market recognition, and have strong growth potential. Article 4 Sponsoring institutions should comply with national strategies and industrial policy orientations, focus on promoting the development of new quality productivity, implement the concept of high-quality development, accurately grasp the positioning of the STAR Market, and recommend enterprises with key core technologies, outstanding technological innovation capabilities, outstanding capabilities in the transformation and application of scientific research results, prominent industry status or high market recognition, and strong growth potential in the "hard technology" field to apply for listing on the STAR Market. Article 5 Issuers applying for listing on the STAR Market should belong to high-tech industries and strategic emerging industries in the following industry sectors: (1) The field of new generation information technology, mainly including semiconductors and integrated circuits, electronic information, next-generation information networks, artificial intelligence, quantum, big data, cloud computing, software, internet, Internet of Things, and smart hardware, etc.; (2) The field of high-end equipment, mainly including smart manufacturing, Siasun Robot & Automation, aviation and aerospace, advanced rail transportation, marine equipment and related services, etc.; (3) The field of new materials, mainly including advanced steel materials, advanced non-ferrous metal materials, advanced petrochemical and chemical new materials, advanced inorganic non-metallic materials, high-performance composite materials, cutting-edge new materials, and related services, etc.; (4) The field of biomedicine, mainly including bioproducts, biologics, high-end chemical drugs, genetic engineering drugs and vaccines, high-end medical equipment and instruments, biomedical engineering, brain-machine interface and related services, etc.; (5) The field of new energy, mainly including advanced nuclear power, large-scale wind power, high-efficiency photovoltaic and solar-thermal power, efficient energy storage, hydrogen energy and related services, etc.; (6) The field of energy conservation and environmental protection, mainly including high-efficiency energy-saving products and equipment, advanced environmental protection technology equipment, advanced environmental protection products, resource recycling, complete vehicle of new energy vehicles, key components of new energy vehicles, power batteries, and related services, etc.; (7) Other fields that meet the positioning of the STAR Market. Financial technology and business model innovation enterprises are restricted from listing on the STAR Market. Real estate enterprises and enterprises mainly engaged in finance and investment business are prohibited from listing on the STAR Market. Article 6 In the relevant industry sectors specified in the STAR Market positioning, enterprises applying for listing on the STAR Market must meet all four of the following criteria: (1) R&D investment accounts for over 5% of operating income in the last three years, or cumulative R&D investment exceeds 80 million yuan in the last three years; (2) R&D personnel account for no less than 10% of total employees in the current year; (3) There are 7 or more invention patents applied to the company's main business and industrialized; (4) The compound growth rate of operating income in the last three years reaches 25%, or the operating income amount in the last year reaches 300 million yuan. Enterprises applying for listing on the STAR Market according to the listing standards specified in Article 2.1.2 of the STAR Market Listing Rules, or red-chip enterprises listed overseas applying for listing on the STAR Market in accordance with the "Opinions on Pilot Domestic Issuance of Stocks or Depositary Receipts for Innovative Enterprises" and other related rules, are not required to meet the requirements of the fourth criterion in the preceding paragraph. The software industry is not subject to the third criterion in the preceding paragraph, but the R&D investment ratio should be over 10%. Article 7 In the relevant industry sectors specified in the STAR Market positioning, although enterprises do not meet the criteria in Article 6 of these regulations, they can apply for listing on the STAR Market if they meet one of the following conditions: (1) The core technology they possess has been recognized by the competent national authorities as having an international leading or leading role or being of significant importance to national strategy; (2) As the main participant or with core technical personnel as the main participants, they have won national natural science awards, national scientific and technological progress awards, national technological invention awards, and have applied the relevant technology to their main business; (3) Independently or taking the lead in undertaking major national science and technology projects related to their main business and core technology; (4) The main products (services) formed relying on core technology are key equipment, key products, key components, key materials, etc. encouraged, supported, and promoted by the country, and they have achieved import substitution; (5) They have a total of 50 or more invention patents (including defense patents) developed based on core technology and applied to their main business and capable of industrialization. Article 8 When issuers apply for listing, they shall submit a specialized explanation on meeting the STAR Market positioning requirements according to the sample format attached to these regulations. The specialized explanation should be focused, clear, and directly explain whether they meet the requirements for science and technology attributes. Issuers should fully, objectively, and accurately disclose the current developmental stage, achieved milestones, and potential risks they may face. Article 9 Sponsoring institutions should conduct due diligence investigations on relevant matters involved in issuers self-assessment based on the positioning of the STAR Market, focusing on whether the basis for issuers science and technology attributes determination is real, objective, and reasonable, and verifying the information disclosure in the application documents. They should issue specialized opinions according to the sample format attached to these regulations, explaining the specific verification contents, the verification process, etc., and stating the verification conclusions and basis in the listing prospectus. During the verification, sponsoring institutions should make comprehensive judgments based on the advancedness of issuers technology and products, business models, market space, etc., and should not simply conclude whether issuers meet the positioning of the STAR Market based on numerical indicators. For those falling under the seventh item in these regulations, sponsoring institutions should make thorough analysis and cautious recommendations. Article 10 In the Issuance and Listing Review by the Exchange, following the principle of substance over form, particular attention should be paid to whether issuers' self-assessment is objective, whether the verification and review by sponsoring institutions are adequate, and whether comprehensive judgment has been made on these aspects: (1) Whether issuers meet the support direction of the STAR Market; (2) Whether the industry sector of issuers belongs to the industry sectors listed in the "Guidelines" and these regulations; (3) Whether the science and technology attributes of issuers meet the relevant indicators or requirements in the "Guidelines" and these regulations; (4) Whether issuers have outstanding technological innovation capabilities; (5) Other requirements stipulated by the Exchange. Article 11 The Exchange may seek advice from the Science and Technology Innovation Consultation Committee on issuers' science and technology attributes, and make an audit judgment on whether they meet the positioning of the STAR Market based on the consultation opinions. Article 12 Issuers should make corresponding information disclosures in the prospectus regarding the support direction, industry sectors, and science and technology attributes indicators or related situations specified in Articles 3-7 of these regulations. Article 13 For information related to the STAR Market positioning that issuers intend to disclose and involves state secrets or business secrets, which if disclosed may violate relevant national confidentiality laws and regulations or seriously harm the company's interests, issuers and their sponsoring institutions may apply for exemption from disclosure to the Exchange. Article 14 Before applying, issuers and their sponsoring institutions may consult the Exchange on the understanding and application of the relevant provisions of these regulations. Article 15 The Exchange shall implement self-discipline supervision on sponsoring institutions recommending enterprises to list on the STAR Market. Sponsoring institutions violating these regulations may be subject to self-discipline measures or disciplinary actions as prescribed. Article 16 These regulations are interpreted by the Exchange. Article 17 These regulations shall be implemented from the date of issuance. The "Provisional Regulations on Application and Recommendation for Listing of Enterprises on the Science and Technology Innovation Board of the Shanghai Stock Exchange" (Shanghai Securities Regulatory Commission [2024] No. 54), issued by the Exchange on April 30, 2024, shall be simultaneously abolished. If there are any inconsistencies between these regulations and other relevant regulations of the Exchange, these regulations shall prevail. This article is excerpted from the "Shanghai Stock Exchange" official website, edited by GMTEight: Jiang Yuanhua.