The Securities and Futures Commission (SFC) today launched a two-month consultation on proposals to abolish mixed media offers (MMOs) to facilitate a fully electronic process for public offerings and enhance the efficiency of the regulatory process in Hong Kong (Note 1).
To this end, the SFC proposed amendments to the Companies (Exemption of Companies and Prospectuses from Compliance with Provisions) Notice to remove the exemption permitting MMOs.
The proposed changes would remove the option for an issuer of equity or debt securities listed or to be listed on The Stock Exchange of Hong Kong Limited (SEHK) to issue printed application forms accompanied by electronic prospectuses under the Companies (Winding Up and Miscellaneous Provisions) Ordinance as the SEHK is gearing up to further expand the paperless listing regime (Note 2).
In addition, the SFC intends to cease granting waivers for the use of MMOs in public offerings of SFC-authorised collective investment schemes listed or to be listed on the SEHK.
“The proposal complements various ongoing initiatives to further digitalise the listing process for the benefits of all participants, including issuers and investors, as continued improvements ensure Hong Kong’s IPO process is efficient and effective,” said Ms Julia Leung, the SFC’s Chief Executive Officer.
The SFC invites the public to submit their written comments on or before 18 October 2024 via the SFC website (www.sfc.hk), by email to classexemptionconsult@sfc.hk, by post or by fax to 2810 5385.
Notes:
- An MMO refers to an offer of any shares in or debentures of a company that are listed or to be listed on the SEHK whereby a company is allowed to distribute a printed application form without it being accompanied by a printed form prospectus, provided that specified conditions are complied with.
- To further expand the paperless listing regime, on 16 August 2024, the SEHK consulted the market on, among other matters, the amendment to the Rules Governing the Listing of Securities on the SEHK to remove the availability of MMOs for listing applicants and listed issuers.
