After the first batch of companies was listed and their shares traded on the SSE STAR Market, the Shanghai Stock Exchange (SSE) continues to advance the review of issuance and listing in an orderly manner. Recently, four companies and their sponsors filed with the SSE for withdrawing their applications and sponsorships for issuance and listing on the SSE STAR Market successively. According to Article 67 of the SSE Rules for Issuance and Listing Review of Stocks on the SSE STAR Market, the SSE decided to terminate the review of the companies for issuance and listing on the SSE STAR Market. The four applicants are Beijing Papaya Mobile Technology Co., Ltd., Hejian Technology (Suzhou) Co., Ltd., Beijing NKD Pharmaceutical Co., Ltd., and Beijing Speechocean Technology Co., Ltd.
It is a normal review mechanism and result for the SSE to terminate the review after the issuers and its sponsors request the withdrawal of their applications for issuance and listing during the process of review. Before the termination of the review, the four applicants were in different stages and procedures of review. Among them one had been amid the multiple rounds of inquiries, one had its sponsor under the on-site supervision, one had preliminary opinions formed by the Review Center at the review meeting, and one had offciallly announced that it entered the process of review at the Listing Committee meeting. In the earlier review inquiries, some issues about the relevant companies drew special attention. These issues include the companies’ core technologies and whether the technologies are highly advanced, horizontal competition, connected transactions and other circumstances that might affect the issuers’ capacity of independent and sustainable operation, the quality of the basic financial accounting and the effectiveness of internal control, as well as the sufficiency, consistency, and comprehensibility of related information disclosure.
By conducting open inquiry-based review and terminating the review of the four applicants for the issuance and listing on the SSE STAR Market in accordance with the law, the SSE earnestly implements the “information-disclosure-centered” review principle and actively improves capability to perform its responsibility for review and enhances the quality of the listed companies in accordance with the reform requirements for launching the SSE STAR Market and piloting the registration-based IPO system. Focusing on the information important to the value judgments and investment decisions made by the investors, the SSE urges the issuers and their intermediaries to disclose information truthfully, accurately and completely through one or more rounds of inquiries in the review for issuance and listing so as to shed light on the real conditions of a company with the inquiries. The review inquiries and the replies of the issuers and their sponsors are available to the public in an open and transparent manner, which will help to realize the investors’ right to know and facilitate the supervision and evaluation of all parties concerned.
According to the existing review rules, standards and mechanisms, if the review inquiries found that an issuer fails to provide reasonable explanations for the issuance conditions, listing conditions and major information disclosure that the SSE pays special and sustaining attention to during the review, or the evaluated and disclosed information about the company’s technological innovation and advancement are obviously not in line with the positioning of the SSE STAR Market, the application may be rejected according to laws as a result. In general, the withdrawal of the application for issuance and listing is the choice of relevant companies after comprehensively considering the review situations and their own conditions. It is learnt that the applicant takes into consideration some important factors as it makes choices and judgments. These factors include the key iusses that the SSE shows great concerns abount andreasonable suspicions in the review inquiries and the possible review outcomes. It fully demonstrates that the open inquiry-based review has played its designed role as an entrance to the SSE STAR Market. As with the consequence of law-based application rejection, the issuers’ withdrawal of the applications for issuance and listing will also result in the termination of the relevant review for issuance and listing. If an issuer or its intermediary is found to have violated the rules during the review, the SSE will deal with the matter in accordance with the rules, whether or not the application is withdrawn.
In accordance with the reform requirements for piloting the registration-based IPO system, the SSE will continue to steadily and efficiently push forward the review for issuance and listing on the SSE STAR Marketwhile carry outing the work evaluation to review experiences and make improvements. Specifically, the SSE will focus on the underlying requirements for the market orientation and the rule of law, work with all market participants to further improve the quality of the issuers’ information disclosure, the intermediaries' practice and the issuance and listing review and keep in mind the positioning of the SSE STAR Market to promote its sound development.