Should Hong Kong’s stock exchange make all IPO applications confidential?
Proposed rule change aims to encourage more applications, but what about transparency and document quality concerns?
The bourse operator will collect views on the proposals, which include broadening a special listing regime for innovative companies and opening the door for listings by smaller and more diverse firms, until May 8.
Investment banks and brokers have piped up in support of a proposal to allow all companies that are pursuing listings to file their applications confidentially – a privilege currently given only to specific types of companies. Market participants believe the reform would attract more listings and enhance Hong Kong as an international financial centre because many other exchanges around the world already keep applications confidential.
Here is what you need to know about how the change would affect the market.
What is the current situation?
Since October 2013, HKEX has required all listing candidates to publish their listing documents, including corporate history, business models and financial information, on the HKEX website once they submit the application to the exchange.