Chinese companies seeking offshore listings will face greater hurdles after mainland regulators imposed new restrictions for sensitive sectors.
More details about Chinese firms in sensitive sectors seeking offshore listings have been unveiled by the National Development and Reform Commission alongside the Ministry of Commerce.
Companies operating in industries banned from foreign investments will need to seek a waiver before proceeding, according to a statement from the two government bodies, effective January 1.
Upon approval, foreign investors are capped to total ownership of 30 percent – including 10 percent for any single investor – and they will also be prohibited from participating in management.
Continued Tightening
This marks the latest development in Beijing’s plan to tighten the path for mainland firms to list abroad, following the Didi debacle which has now led to regulators pushing for its delisting in New York.
Last Friday, the China Securities and Regulatory Commission proposed that mainland firms seeking IPOs and additional share sales abroad would have to register with listings deemed to be a national security threat banned from proceeding.
