Third Board exchange welcomes applications for listings

The listed companies at the National Equities Exchange and Quotations from four high-tech industrial parks that have financed about 1 billion yuan ($165 million) this year and firms from across China will be allowed to apply for listings on the exchange from Tuesday.

"We welcome all companies meeting requirements to apply for listings on the exchange. They do not need to line up," said Xie Geng, CEO of the National Equities Exchange and Quotations.

The examination and approval process for being listed on the exchange will be under 40 days.

The State Council, China's cabinet, released a statement earlier this month indicating that micro, small and medium-sized enterprises can all be listed on the board.

Prior to this, membership was restricted to companies from the four high-tech industrial parks in China - Zhongguancun Science Park in Beijing, Zhangjiang Hi-Tech Park in Shanghai, Wuhan East Lake High-tech Zone in Hubei province and Binhai New Area in Tianjin.

The China Securities Regulatory Commission last week issued a revised regulation on unlisted public companies and seven supporting rules for National Equities Exchange and Quotations, the so-called Third Board.

The Third Board released eight new business rules and six revised ones on Monday, including some covering stock transfers, stock issuance and investor eligibility.

The minimum funding amount for an individual investor was raised to 5 million yuan, up from 3 million yuan.

Xie said innovative and startup enterprises are the main force of the Third Board. Investors are mainly venture capital funds and industry capital, aiming at long-term investment.

"The supply and demand relationship determines that the Third Board will not have a very high turnover rate, but we will improve liquidity through appropriate institutional arrangements," he said.

The Third Board outlined three trading methods: agreement, market maker and bidding to transfer shares. When choosing market maker, at least two securities firms must participate in the trading.

Listed companies on the Third Board can seek financing by issuing common stock, preferred shares, or corporate bonds. Equity financing is the main method at the exchange.

The trading system of the National Equities Exchange and Quotations will go online between May and August of next year.