China Securities Regulatory Commission (CSRC) Chairman Wu Qing stated that the narrative for technology investments in the A-share market has become clearer and more concrete. He made these remarks during an economic-themed press conference at the National People's Congress on the afternoon of March 6.
Wu Qing highlighted that a number of innovative companies have efficiently completed IPOs and mergers and acquisitions in recent years. This trend reflects the opportunities and resilience brought about by high-quality economic development.
The overall plan for deepening the reform of the ChiNext board has now largely taken shape. Wu Qing announced two new key initiatives. First, the beneficial experiences from the STAR Market reforms will be replicated and extended to the ChiNext board. Second, the refinancing mechanism will be optimized. He indicated that the detailed plan for the ChiNext reform will be further refined and released when the timing is appropriate.
A new set of more precise and inclusive listing standards will be introduced on the ChiNext board. This aims to actively support high-quality innovative and entrepreneurial companies in sectors such as new consumption and modern services to list on the board.
As part of the reform, beneficial practices from the STAR Market will be applied to ChiNext. A key measure will be the introduction of a pre-review mechanism for IPOs of qualified high-quality innovative companies, particularly those achieving breakthroughs in key core technologies. Eligible companies undergoing review will be permitted to conduct capital increases for existing shareholders. Additionally, the pricing mechanisms for new share issuances will be optimized.
The refinancing registration mechanism will be further improved at the regulatory level. This includes enhancing the inclusivity and adaptability of the rules, such as optimizing the criteria for defining strategic investors and facilitating participation by long-term funds like social security, insurance, and housing provident funds. A shelf offering system will be introduced to guide rational and effective financing. The mechanism for priced private placements will be improved to align offering prices more closely with market prices, thereby better balancing the interests of listed companies and investors. The simplified procedures for refinancing will also be further optimized.
The reform will further emphasize supporting high-quality and science-oriented companies. For well-governed, operationally sound, and market-recognized quality listed companies, review efficiency will be significantly enhanced. The criteria currently used on the STAR Market and ChiNext for identifying asset-light companies with high R&D investment will be extended to the main board market.
Regulatory oversight of refinancing will be strengthened. Supervision will cover the entire process from plan disclosure and application acceptance to review, registration, and the use of raised capital. Enforcement will be intensified to strictly punish violations such as deceptive refinancing and improper changes in the use of proceeds.
The entry gate for IPOs will be rigorously managed to prevent companies with issues from applying and to avoid a rush of listings. A gradual, quality-first approach will be upheld, and the responsibilities of intermediaries will be reinforced. This aims to promote coordinated development of investment and financing, achieving a positive interaction between deepening reforms, enhancing market functions, and maintaining stability.
Wu Qing noted that inclusive reforms in the capital market to support technological innovation are an ongoing and exploratory process. Technological innovation involves high investment, long cycles, and significant risks, with success often resulting from sustained effort and a rigorous selection process. He expressed hope that all market participants would offer more understanding and tolerance, working together to create an environment that encourages innovation, rewards success, and accepts failure.
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