SHANGHAI/SINGAPORE : Chinese companies' plans to raise capital via listings in London or Zurich are in jeopardy after Beijing mandated new disclosure rules, put curbs on the use of the funds and made issuances liable to national security reviews, bankers and lawyers said.A total of 18 Chinese companies ha
SHANGHAI/SINGAPORE : Chinese companies' plans to raise capital via listings in London or Zurich are in jeopardy after Beijing mandated new disclosure rules, put curbs on the use of the funds and made issuances liable to national security reviews, bankers and lawyers said.
Those issues will now be clouded by the publication of new rules by the securities regulator last week requiring, among other things, that such activities must not leak state secrets, while fundraising should be"rational", and not too frequent. Mandy Zhu, head of China global banking at UBS, which has worked on many of the GDR issuances, said the new rules would"significantly" increase underwriters' costs, workload, and responsibility in vetting the deals.
The SIX exchange said it was too early to tell the impact of the new rules, and the bourse would monitor the developments closely.LSEG owns financial news and information business Refinitiv, formerly a division of Thomson Reuters. Thomson Reuters holds a minority stake in LSEG.According to the new rules, the size of the GDR fundraising should be"rational", while proceeds must be invested in areas in line with China's industrial policies.
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