SSE Receives 1st Batch of 2 Applications for Infrastructure Public Offering REITs Projects

On April 21, the electronic application system of public offering infrastructure securities investment funds (REITs) of the Shanghai Stock Exchange (SSE) begins to receive project application documents. As of 17:00 on April 21, the SSE audit system has received applications submitted by two companies, and the exchange will make a decision on whether to accept the application within five working days. The above projects would also be reported to the China Securities Regulatory Commission (CSRC) on the same day. The launch of the first batch of project applications marked another key step by the SSE during piloting the public offering of infrastructure REITs.

The project application portal of the SSE infrastructure public offering REITs review system

The application of the two projects, namely, Zheshang Securities Shanghai-Hangzhou-Ningbo Expressway Closed Infrastructure Securities Investment Fund and Guojin Tiejian Chongqing-Suining Expressway Closed Infrastructure Securities Investment Fund, marked another major stride by the capital market serving the national strategies of the Yangtze River Delta's integration and the development of the Yangtze River economic belt. The two projects are both pilot ones recommended by the local development and reform commissions and selected by the National Development and Reform Commission (NDRC), which are then submitted to the CSRC.

In the early stage, the CSRC issued the Guidelines for Public Offering of Infrastructure Securities Investment Funds (for Trial Implementation), and held several seminars to guide the deployment of infrastructure public offering REITs. The important reference texts formulated by the SSE under the guidance and leadership of the CSRC include prospectus, fund contract, operation and management agreement, fund custody agreement, legal opinions document and cash flow measurement report according to the ABS Project audit experience and the main institutional arrangements of public offering REITs. In addition, the SSE has carried out several rounds of seminars on major issues such as governance system, connected transactions, horizontal competition and asset valuation and coordinated the business guidance in advance. All these measures aim to ensure the smooth progress of the pilot projects.

At present, the pilot of infrastructure public offering REITs, which is of great significance to the innovation of China's infrastructure investment and financing mechanism, the optimization of resource allocation and the revitalization of existing assets, as well as building a new pattern of dual-cycle development. Going forward, under the leadership of the CSRC and in line with relevant procedures and requirements for public offering of securities, the SSE will tighten screening of project and serve as the gatekeeper, strengthen project examination, trading mechanism optimization and investor cultivation, and accelerate the implementation of a number of high-quality pilot projects, thus forming the market scale and the project accumulation as soon as possible for a good demonstration effect. Meanwhile, as a market organizer, the SSE will work with local governments, sponsors, fund managers and program managers alike to study and solve new circumstances and issues in the pilot projects, and continue to promote the long-term healthy development of the REITs market.