Hong Kong Capital Markets Update – Issue 6, July 2023

On 21 July 2023, the Stock Exchange of Hong Kong Limited (the “Exchange”) published the conclusions of its consultation on the rule amendments following Chinese Mainland regulation updates and other proposed rule amendments relating to PRC issuers. 

Following announcements by the State Council and China Securities Regulatory Commission on the implementation of the New Regulations on overseas listing and the repeal of the Special Regulations and the Mandatory Provisions on 17 February 2023, the Exchange published a consultation paper (“Consultation Paper”) on 24 February 2023 which set out the proposed rule amendments in relation to the Chinese Mainland regulation updates and other proposed rule amendments relating to PRC issuers (for a summary, please refer to our Capital Markets Update Issue 2023-02). The consultation period ended on 24 March 2023.

Having considered the market feedback, the Exchange will adopt all the proposals outlined in the Consultation Paper with minor modifications. The major amendments to the Listing Rules are summarised below:

1. Remove the rule requirements that reflect the requirements set out in the Mandatory Provisions; 
2. Amend the documentary requirements for new listing applications to reflect Chinese Mainland’s new filing requirements for overseas listings of the Chinese Mainland-based companies; 
3. Allow the limits on general mandate for new share issuance and scheme mandate for share schemes to be calculated with reference to a PRC issuer’s total issued shares (instead of referencing to each of domestic and H shares);
4. Remove the requirements for directors, officers and supervisors of PRC issuers to provide undertakings to the issuers and their shareholders to comply with the PRC Company Law and the articles of association;
5. Align minor requirements on compliance advisers for PRC issuers with those for all issuers; and
6. Remove certain requirements for PRC issuers relating to (i) online display or physical inspection of documents and (ii) disclosure in listing documents of new applicants. 

The Listing Rule amendments will come into effect on 1 August 2023.