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China will support IPO companies abroad

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Chinese state media, citing a meeting on financial stability chaired by Vice Premier Liu He, said that Chinese and US regulators are moving forward on a plan to cooperate on the listing. shares of Chinese companies in the US.

This move comes after many Chinese companies canceled plans to list on the New York Stock Exchange due to concerns about tightening measures by the Chinese government, causing uncertainty among investors. from two countries.

China’s support for overseas initial public offerings (IPOs) is a signal that Beijing’s phase of tightening control of the technology sector may soon be eased.

Previously, in China, new regulations related to issue of shares initial public offering (IPO) abroad aimed at technology companies has officially taken effect from February 15.

Under new Chinese government regulations, technology companies with more than 1 million users who want to IPO abroad will have to report to regulators.

Chinese authorities will evaluate this IPO plan based on a variety of criteria such as user data, confidentiality and how it is used. If the information sources are at risk of being shared or exploited by foreign countries, the IPO process will not be approved.

“These measures are to improve the information monitoring system. Previously, regulators only considered IPOs when companies had applied for listing on foreign stock exchanges, even in some cases. The IPO has been completed, but the approval process in China has not been completed. At the same time, companies do not know specifically what information needs to be kept confidential,” said Joy Huang, Allbright Law Firm. .

IPO approvals in China can take up to 6 months. According to experts, the new regulations have created many barriers for Chinese technology companies if they want to list on foreign stock exchanges.

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