BIZCHINA / News
Foreign exchanges allowed to set up rep offices
By Zhang Ran (China Daily)
Updated: 2007-05-21 08:57
The securities regulator announced yesterday that it will allow overseas
stock exchanges to establish representative offices in the country from
July 1 - a move expected to facilitate the listing of more Chinese
companies overseas.
The overseas bourses will be allowed to promote their organizations and
conduct research through the offices, the China Securities Regulatory
Commission (CSRC) said.
"It represents a milestone for overseas stock exchanges in attracting
local companies for listing, " said Cheng Weiqing, a senior analyst with
CITIC Securities.
By setting up representative offices, overseas bourses will have much
more access to information and resources related to local companies. It
will also help Chinese firms better understand overseas exchanges, Cheng
said.
The move is seen as fulfilling one of China's commitments in the first
round of the Sino-US Strategic Economic Dialogue held in December, when
Beijing promised to allow overseas exchanges to set up offices in the
country soon.
Both the New York Stock Exchange (NYSE) and the Nasdaq Stock Market Inc
(NASDAQ) have been preparing for the establishment of their Beijing
offices since then.
Noreen Culhane, executive vice-president of the NYSE Group, said that the
bourse discussed listing with over 20 Chinese companies during her visit
to Beijing last month. Three Chinese companies listed on its main board
in the first quarter.
Rival NASDAQ attracted six Chinese companies in the first quarter; and
the tech-heavy bourse recently launched a NASDAQ China Index to track the
performance of Chinese companies listed in the US.
China's booming economy and the increase in initial public offerings
(IPOs) have created heated competition among overseas exchanges to lure
the country's companies. NYSE, NASDAQ, London, Singapore, Toronto, Tokyo
and other giant stock exchanges are among the competitors.
Last year, 86 Chinese firms raised $44 billion from overseas IPOs,
accounting for 19 percent of the global total that year, according to
Xinhua News Agency. The previous year, 81 Chinese firms raised $20.5
billion from overseas IPOs.
(For more biz stories, please visit Industry Updates)
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