CSRCs reply to hot issues on the new third board reveals the next step of the reform

category:Finance
 CSRCs reply to hot issues on the new third board reveals the next step of the reform


Lower the threshold for individual investors

Investor suitability system is an important basic system of capital market. According to the requirements of the decision of the State Council on issues related to the national equities exchange system for small and medium-sized enterprises (hereinafter referred to as the decision), the new third board has established an investor suitability management system suitable for the identification and tolerance of investors risks. Most listed companies are in the period of entrepreneurship and growth. In order to balance the relationship between listing access and investor access, the new third board implements a strict investor suitability system, requiring natural person investors to have financial assets of more than 5 million yuan, while natural person investors who do not meet the requirements of account opening threshold can indirectly invest in the new third board by purchasing financial products.

With regard to the issue of lowering the threshold of individual investors, introducing restrictions on investment proportion, and properly managing and guiding institutional investors, the CSRC said that it is currently studying and developing the relevant systems for improving the new three board of public funds, QFII, rqfii and other investment, and has drafted the measures for the administration of domestic securities and futures investment of qualified overseas institutional investors and RMB qualified overseas institutional investorsuff08 Draft for comments and provisions on the implementation of measures for the administration of the investment of domestic securities and futures by qualified overseas institutional investors and RMB qualified overseas institutional investors (Draft for comments), it is proposed to include the shares listed on the new third board into the investment scope of QFII and rqfii. The two rules have been publicly solicited for opinions on January 31, 2019. After the rules are revised and released, QFII and rqfii can participate in securities trading on the new three board market according to law.

The next step is to continue to study and improve the investor suitability management system. At the same time, optimize the institutional investment system according to the needs of market development, encourage institutional investors such as securities companies, insurance companies, securities investment funds, private equity investment funds, venture capital funds and enterprise annuities to participate in the new third board, enrich the types of investors, expand the number of investors, and promote more institutional investors to enter the market. The CSRC further said.

The threshold of 5 million yuan for individual investors provides a strong guarantee for the control of risks and the smooth start and rapid development of the new third board market. The draft of detailed business rules for the comprehensive deep reform proposes to set up a selection layer, and a multi-level development plate will be formed within the new third board market to implement the differentiated system arrangement. Accordingly, there will also be tiered arrangements in terms of investor suitability arrangements, and the threshold for individual investors at the select level is expected to be significantly reduced. Xie Cai, vice president and chief industry analyst of Huacai new third board Research Institute, told Securities Daily.

In Xie Cais view, in terms of the types of investors, the new third board market is expected to introduce more investment institutions and investors in the future, which is the real demand for financing of new third board enterprises. In addition, China Securities Regulatory Commission has issued a draft of relevant policies for consultation, and the introduction of QFII and rqfii into the new third board is just around the corner; allowing public funds and government funds to invest in the new third board is conducive to broadening the financing channels of the new third board and helping the growth and development of enterprises in the new third board.

Improve the design of equity incentive mechanism

In December 2013, the CSRC issued the supervision and management measures for non listed public companies, which defined directors, supervisors, senior managers and key employees as qualified investors for targeted issuance, providing institutional paths for non listed public companies to explore the implementation of equity incentive and employee stock ownership plan. In recent years, a large number of non listed public companies have made positive effects in promoting the formation of the interest community of the owners and workers of the capital market, mobilizing the enthusiasm of the companys executives and core employees, stabilizing the staff and improving the corporate governance mechanism through targeted issuance.

In response to the issue on improving the design of equity incentive mechanism of the new third board, the CSRC pointed out that the next step will be to study the normative path and relevant requirements of equity incentive and employee stock ownership of companies listed on the new third board based on the full consideration of the characteristics of the new third board market in accordance with relevant laws and regulations, and promptly formulate and issue relevant rules to support small and medium-sized enterprises in attracting talents and innovative development.

Although there is no specific reference to the special system of equity incentive on the new third board in the detailed business rules of this comprehensive and deep reform, the relevant person in charge of the national stock transfer company has said that at present, he is working with the relevant departments of the CSRC to study and formulate the special rules of equity incentive on the new third board, to clarify the regulatory requirements for listed companies to implement equity incentive by means of stock options and restricted shares, so as to further promote the new Third board listed companies use equity incentive to achieve healthy and stable development.

At present, the market is full of expectations for the implementation of the special equity incentive system. Zhou Yunnan, a commentator of the new third board and founder of Beijing Nanshan investment, said in an interview with the Securities Daily that equity incentive plays a positive role in truly retaining the entrepreneurial team and core employees of the new third board enterprises with innovative, entrepreneurial and growing small and medium-sized enterprises as the main body, and in better attracting all kinds of high-end talents.

Improve market positioning and stratification

The decision has made a clear positioning of the new third board market, mainly for the development of innovative, entrepreneurial and growth oriented small and medium-sized enterprises. In recent years, China Securities Regulatory Commission (CSRC) insists on the above positioning, promotes the construction and development of the new third board market, and constantly improves relevant institutional arrangements.

Buna Xin, director of the China Council for the promotion of international science and technology, told the Securities Daily that in accordance with the idea of multi-level and step-by-step, the new third board implemented hierarchical management in 2016, dividing the market into basic layer and innovation layer; in December 2017, under the premise of maintaining the basic structure and basic logic of market stratification, the national stock transfer company adjusted part of the access and maintenance of innovation layer The standard has promoted more high-quality enterprises to gather at the innovation level; in the draft for comments on the business rules of the deep reform, it was formally proposed to establish a selection level to further improve and optimize the market positioning and stratification of the new third board.

China Securities Regulatory Commission said that practice has proved that market stratification is a basic institutional arrangement that conforms to the characteristics of small and medium-sized enterprises and has the characteristics of the new three board, which has positive significance for reducing the cost of investors information collection and realizing the hierarchical and classified management of risks. At present, there are a large number of companies listed on the new third board with multiple types, and there are great differences in the development stage, the level of publicity, financial situation and other aspects. There is still a large room for improvement in the implementation of differentiated supervision and services.

With regard to the issues of improving the market positioning and stratification of the new third board, implementing continuous competitive trading, and improving the quality threshold of the access enterprises, the CSRC pointed out that the next step will continue to deepen the reform of the new third board, optimize the stratification and related supporting systems, improve the institutional arrangements of information disclosure, issuance, trading, investor access, regulatory services and other differences, and study and launch continuous competitive trading The feasibility of the trading mechanism, strengthen supervision, constantly improve the quality of information disclosure of listed companies, enhance the vitality and attraction of the new third board, and better serve the real economy.

Source: responsible editor of Securities Daily: Yang qian_nf4425