HKEX proposes new listing chapters for emerging and innovative companies

On 23 February 2018, the Stock Exchange of Hong Kong published a consultation paper on the proposed new listing rules to facilitate listings of companies from (i) biotech issuers; (ii) companies with weighted voting right (WVR) structures; and (iii) a new concessionary secondary listing routes for China and international companies.

In the proposals, HKEX offers new guidance on the listing eligibility and suitability criteria for biotech issuers such as pharmaceuticals producers, biologics, and medical devices, and requires new applicants with a higher market capitalisation and enhanced disclosure requirements.

For innovative issuers with WVR structures, an applicant will be required to demonstrate a WVR structure by reference to a number of characteristics, including the nature of the company and the contribution of the proposed WVR beneficiaries, and includes safeguards such as limits on WVR power and measures to protect non-WVR holders’ right to vote, enhanced corporate governance and disclosure requirements.

For the new secondary listings chapter, HKEX aims to facilitate listings of innovative companies that are primarily listed on a Qualifying Exchange (QE) in the US or the UK.

The public comment period ends on 23 March 2018.