Recently, high-level officials have successively released policy signals for the improvement of platform economy, pointing out the need to support the legal compliance of platform economy and digital economy, listing and financing at home and abroad.
Since last year, the US Securities and Exchange Commission (SEC) foreign company Accountability Act has been like a sword of Damocles hanging on the head of China concept shares. The regulatory policy on China concept shares has become stricter, and the delisting risk of China concept shares has increased; At the Chinese level, the relevant competent authorities have formed a regulatory combination for the overseas listing of enterprises. Data security and data exit will become important regulatory directions, bringing certain pressure to enterprises.
The listing of China concept stocks in the United States slowed down significantly last year, and the pace of IPO of Hong Kong stocks in the fourth quarter also decreased. Recently, it released a signal to support the listing of platform enterprises at home and abroad, which responded to the important concerns of the market some time ago, and the trend of China concept stocks was better.
China concept shares go to Hong Kong for “dual listing” or become a new choice?
In fact, since last year, the overseas listing of Chinese digital enterprises has slowed down significantly under the influence of multiple policies.
In terms of the international environment, the differences between China and the United States on securities regulation have intensified, and the foreign company Accountability Act of the U.S. Securities and Exchange Commission (SEC) has had an impact on zhonggai shares. The detailed rules for the implementation of the act determined at the end of last year require foreign companies listed in the United States to submit documents to the SEC to prove that the company is not owned or controlled by foreign governments, and require these enterprises to comply with the audit standards of the United States Public Company accounting oversight board (PCAOB).
On December 20 last year, Deloitte released the review of the new share market in China and Hong Kong in 2021 and the outlook for 2022, which pointed out that in the second half of the year, only four new shares of China concept stocks were listed in the United States, compared with 42 in the whole year
Since the beginning of March this year, the US Securities and Exchange Commission (SEC) has published the list of seven batches of “pre delisted” Chinese concept stocks, including Jingdong, pinduoduo, BiliBili, Netease, Tencent music and didi.
According to recent news, the two sides have maintained close communication on audit supervision. On April 9, at the third member congress of the China Association of listed companies, Yi Huiman, chairman of the CSRC, said that the pace of high-level opening of the capital market will not change CSRC will accelerate the implementation of new regulations on the supervision of overseas issuance and listing of enterprises, maintain smooth channels for overseas listing, and support Chinese enterprises to make better use of two markets and two resources in accordance with the law . In accordance with the principle of “respecting international practices and abiding by Chinese laws and regulations”, promote the results of China US audit supervision cooperation and build a predictable international regulatory environment for the high-level opening of the capital market
Affected by the favorable policy news this week, the platform supervision is moving towards “normalization”, and the standardized and healthy development has become the theme of the future, and zhonggai shares are bullish. JPMorgan pointed out that it is re examining the short-term and long-term fundamental prospects, China’s Internet industry is getting rid of various uncertainties and will be driven by short-term and long-term fundamental factors. In the future, the share price of the head company may rise more than expected
In addition, many research institutions pointed out that can pay attention to the process of “dual listing” of China concept shares in Hong Kong .
Founder Securities Co.Ltd(601901) pointed out that because the “dual listing” does not need to meet the requirement that the “secondary listing” needs to be listed in the main listing place for two years, and the listing of Hong Kong shares can be completed faster through “Introduction listing”. At the same time, three enterprises have entered Hong Kong stock connect through “dual listing”, so “dual listing” may become a new choice for the return of zhonggai shares.
On May 4, according to the official website of the CSRC, the CSRC held a special meeting and said that it would steadily expand the institutional opening of the capital market expand the scope of interconnection between domestic and foreign markets, deepen the cooperation between the mainland and Hong Kong capital markets, and promote the implementation of the regulatory system for overseas listing of domestic enterprises
China International Capital Corporation Limited(601995) research data show that since the reform of the listing system in 2018 to January 14, 2022, 15 American Chinese concept stocks such as Alibaba, jd.com, Baidu, Netease, Ctrip and Weibo have been listed in Hong Kong for the second time. It is expected that 60 Chinese concept enterprises will meet the conditions for the second listing in the next 3-5 years .
Attaching equal importance to security and development, data compliance is still a long-term proposition
In addition to the impact of foreign regulatory environment, after last year’s didi incident, China strengthened the network security review of Listed Companies in the United States and successively issued relevant policy documents.
On July 2, 2021, the Network Security Review Office announced that it would conduct network security review on “didi travel”; Since then, the Internet Information Office has carried out network security review on a number of Listed Companies in the United States.
At that time, a number of Chinese companies in the US stock exchange adjusted their IPO listing strategies, and Himalaya and hello travel suspended their foreign listing plans.
In addition to regulatory and law enforcement actions, relevant policy documents have been intensively issued.
The 21st Century Business Herald reporter found that since the second half of last year, laws and regulations, policy documents, departmental rules and normative documents (including the draft for comments) involving overseas listing of enterprises have been about 10. Strengthening the supervision of China concept shares, improving data security and emphasizing network security declaration have become the focus of policies .
This week, the policy once again emphasized supporting the domestic and foreign financing and listing of digital enterprises. Does it mean that the network data security review slows down?
Many experts interviewed believe that network security review will not be weakened. As an important part of national security and the base of development, network security will balance security and development
“After last year’s intensive promulgation of laws and policies and the rectification of the platform, the rules have been established, and the enterprise has formed the awareness of compliant operation.”
Wang Pengbo, a senior analyst in the financial industry of Broadcom analysis, believes that “the review of network data security does not mean that it does not support enterprise development, but emphasizes healthy development.”
21st Century Business Herald noted that from the prospectus of the enterprises to be listed recently, it can be seen that the disclosure of risks such as data security and user privacy has become a necessary option, and has even reached the same important position as financial data disclosure. The granularity of relevant questions on the regulatory side is also gradually refined
For technology platform companies with a large amount of data, they need to carefully deal with the challenges brought by data compliance and avoid the risk of uncertainty caused by the continuous changes of regulations and supervision. Data compliance risk is a thorny problem. If handled properly, it can also become the competitive advantage of the company and the “reassurance” of investors.
