File photo of investors at an exchange in Haikou on December 3. (Photo/China News Service)
Registration-based mechanism set to ease listing logjam
China's effort to overhaul its approval-based mechanism for IPOs and shift to a registration-based system is in the final stages of gaining approval from the country's top legislature, and the new system could start as early as in March 2016, analysts said on Monday.
Pitching reform plans to members of the Standing Committee of the National People's Congress (NPC) at a meeting in Beijing on Monday, Xiao Gang, chairman of the China Securities Regulatory Commission (CSRC), said that authorizing the new reform is "feasible," the Shenzhen-based Securities Times reported Monday.
Xiao suggested that the NPC should approve a draft proposal for the new IPO system passed earlier this month by the State Council, China's cabinet, and also allow the adjustment of relevant regulations under current security laws to enable implementation of the registration-based process for IPOs, according to the Securities Times.
The draft proposal passed by the State Council called for the new system for IPO listings to be implemented in the Shanghai and Shenzhen stock exchanges within a two-year time frame.
Might start in March
There is no doubt that the NPC will pass the draft proposal during this week's legislative session, said Dong Dengxin, director of the Finance and Securities Institute at Wuhan University of Science and Technology.
Dong told the Global Times on Monday that the CSRC could issue temporary guidelines for the implementation of the IPO registration system next week, and the official start of the new system could come in March.
