Merger of SZSE’s SME Board and Main Board Officially Implemented on April 6, 2021
ISSUING AUTHORITY:
Shen Zhen Stock Exchange
DATE OF ISSUANCE:
EFFECTIVE DATE:
April 6, 2021
On February 5, 2021, Shenzhen Stock Exchange (SZSE) issued the Notice on the Initiation of the Preparatory Work for the Merger of the SME Board with the Main Board (the “Notice”). The Notice stated that, as approved by the China Securities Regulatory Commission (CSRC), SZSE would initiate the preparatory work for the merger of the SME Board with the Main Board (the “Merger”). On March 31, SZSE announced that the Merger was to officially take place on April 6 and specified the relevant post-Merger arrangements. In order to integrate the business rules of the two boards, SZSE also made adaptive revisions to seven SZSE Rules including Trading Rules, Detailed Rules for Margin Trading and Securities Lending, Guidelines on High-Ratio Bonus Issue and Stock Dividend Distribution, Guidelines on Information Disclosure, etc., and abrogated certain regulations related to the SME Board. The integration mainly involves removing from the documents the statements about the SME Board, adopting one uniform definition of high-ratio bonus issue and stock dividend distribution, adjusting the relevant benchmark indexes for transaction indicators, abolishing the system of continuous supervision agents, etc. The revised rules and regulations took effect on April 6 upon the Merger.
Arrangements for the Merger will follow the principle of “Two Unifications and Four Invariances.” That is, the merged board will adopt one uniform system of business rules and one uniform regulatory model; the listing conditions, requirements for accredited investors, trading mechanism, and stock codes and abbreviations will remain unchanged.
Since its establishment, the SME Board has always complied with laws, regulations and departmental rules which are in principle consistent with those observed by the Main Board. Therefore, the Merger will make adaptive adjustments to only a limited portion of business rules, market products, technical systems, and IPO processes, having a relatively low overall impact on market operation and stock trading.
Upon the Merger, the Main Board, maintaining its listing standards, will primarily support the financing and development of comparatively established businesses. The ChiNext Board will primarily serve growth-type innovative startups.
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