Shanghai maps out course to raise listed companies’ quality in a bid to burnish financial hub credentials

Name: Shanghai Free-Trade Zone doubles in size to include Tesla base, drawing US$1.55 billion investment
Uploaded: 2020-11-20T10:37:49.000Z
Duration: 1 min 8 s
Description: Shanghai Free-Trade Zone doubles in size to include Tesla base, drawing US$1.55 billion investment

Shanghai will encourage listings of hi-tech companies, market-based asset restructuring and get tough on delisting, according to a 17-point guideline

Shanghai has 337 listed companies, the third most among China’s provinces

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The Shanghai government has released 17 guidelines as part of a drive to build the city into a global financial centre. Photo: Xinhua

Zhang Shidongin Shanghai

Published: 6:37pm, 20 Nov 2020Updated: 11:34pm, 20 Nov 2020

Shanghai will encourage local companies in fledging industries to list on the stock market, promote market-based mergers and acquisitions and streamline delisting mechanism, as China’s biggest commercial city seeks to improve the quality of publicly traded companies.

Makers of integrated circuit, new-energy vehicles and high-end equipment as well as companies from the city that represent the new economy will be given priority for going public, according to a 17-point guideline promulgated on Friday by the Shanghai government, which takes effect next month.

Technology firms in Zhangjiang hi-tech park and Lingang industrial zone, where Tesla’s plant is based, will be encouraged to list on Shanghai’s Nasdaq-styled Star Market, it said.

The government will also encourage the listings of so-called red-chip companies – Chinese firms that are incorporated overseas – on the Shanghai market. The same treatment will be applied to companies with mixed-ownership, which includes both state and private investors.

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Shanghai Free-Trade Zone doubles in size to include Tesla base, drawing US$1.55 billion investment

The guideline is seen as part of a drive to build Shanghai into a global financial centre. The city has set up free-trade zones to facilitate foreign trade and capital flows, and launched the Star Market to woo China’s fastest-growing companies in direct competition with Hong Kong.