On March 1, according to the unified arrangements of the China Securities Regulatory Commission (CSRC), SZSE issued the Notice on Relevant Business Arrangements Concerning the Implementation of the Registration-based System for Publicly Issued Corporate Bonds, which has, ahead of others, laid down the arrangements for the review of the issuance and listing of publicly-issued corporate bonds on SZSE and relevant business under the registration-based system. It’s an important measure adopted by SZSE to implement the new Securities Law, orderly advance the reform of the securities issuance system and better serve the development of the real economy.
Since 2015, SZSE has, according to the arrangements of CSRC to streamline approval procedures and the concept of the registration-based system, conducted pre-review of the listing of publicly offered corporate bonds. SZSE is the first to make the entire acceptance and review procedure electronically, which has saved market cost and improved review efficiency. SZSE has released business rules and regulatory Q&As such as review standards and procedures, regulated review business and clarified market expectations. SZSE has also made public the materials for information disclosure, review opinions and review progress comprehensively and promptly, improved the transparency of work and accepted scrutiny by the social public. In the past five years, the issue volume of corporate bonds has continued to rise with a wider variety of innovative product and a table and efficient pre-review mechanism, which lays a solid practical foundation for the implementation of the registration-based system for publicly issued corporate bonds on all sides.
A few days ago, the General Office of the State Council issued Notice on Relevant Work Concerning the Implementation of the Revised Securities Law and CSRC released Notice on Matters Relating to the Implementation of the Registration-based System for Publicly Issued Corporate Bonds, which have further confirmed that the Registration-based System for Publicly Issued Corporate Bonds shall become effective as of March 1. SZSE has fully implemented the arrangements and made quick responses by immediately releasing a business notice that has clearly listed the review standards, review procedures, entity responsibilities, etc. under the registration-based system, which mainly includes three aspects.
First, implementing the procedure arrangements of the registration-based system to ensure the stable transition of the reform. After the registration-based system is implemented, there will be no difference between the “small” and the “large” mutual bonds, and all publicly issued corporate bonds to be listed on SZSE will be reported to CSRC to undergo issuance registration procedures after being accepted, reviewed and approved by SZSE, while private placement corporate bonds are still subject to current regulations. Second, clarifying review standards for the convenience of market players. Publicly offered corporate bonds shall meet new issuance and listing conditions, while the content and formats of application documents and prospectuses are still subject to current provisions, and review procedures and time limit for the time being are also subject to current regulations on listing pre-review of corporate bonds. Third, improving relevant listing system to orderly adapt to changes in rules. It’s made clear that the issuance of corporate bonds shall meet statutory issuing conditions, and the listing suspension system shall be abolished. Corporate bonds that have been suspended from listing shall be traded pursuant to relevant provisions laid down by SZSE in the Notice on Matters Relating to Adjustment to the Trading Modes of Bonds during Listing. After the Notice is implemented, the public offering corporate bond applications and listing applications that were previously accepted will still be subject to the old regulations.
To earnestly fulfill the responsibility of reviewing the issuance and listing of corporate bonds, SZSE gathered forces in advance, systematically sorted out review business rules and made full use of existing paths to realize the registration-based system, which has reduced its impact on market players to the greatest extent. SZSE also designated specific personnel and setting up positions specially for the registration-based system, upgraded the technology for fixed-income product business and improved the list of application documents for corporate bond issuance and listing and the templates of application and reporting documents. We continued to open green channels of review for innovative products and high-quality issuers’ projects. In carrying out the review work, SZSE will adhere to the fundamental philosophy of information disclosure as the core, follow the principles of compliance, openness, transparency, convenience and efficiency, and urge issuers to fulfill the primary responsibility of information disclosure and fully disclose information closely relating to their credit standing and solvency, and intermediaries to be industrious and responsible to ensure that information disclosure is authentic, accurate and complete. SZSE will strictly oversee fraudulent issuance and violations in information disclosure and etc. to improve the market-oriented constraint mechanism and protect investors’ legal rights and interests.
The new Securities Law has provided a legal basis to guarantee the comprehensive implementation of the registration-based system for securities issuance. Corporate bonds are the first type of securities upon which the registration-based system is implemented following enforcement of the new Securities Law, which is another milestone in the market-oriented, rule-of-law-based development course of corporate bonds. SZSE will faithfully follow the requirements of the new Securities Law, and accelerate formulating and improving the supporting rules and business guidelines for the implementation of the registration-based system for publicly issued corporate bonds. We will also act efficiently as liaison and energize the market to lay a solid foundation and accumulate experience for the sweeping reform of the securities issuance system. In the meantime, SZSE will actively strengthen the training and guidance of market institutions through online courses and other means, and ensure that the work concerning the registration-based system is carried out steadily. We’ll give better play to the function of the exchange bond market to serve the real economy, and continue to inject strong vitality into the building of a standard, transparent, open, dynamic and resilient capital market.
