New regulations for unlisted public companies a boon for lawyers

The formal establishment of National Equities Exchange and Quotations (NEEQ) on 16 January is a milestone in the multi-level development of China’s capital markets, providing a national trading and financing platform for unlisted public companies.

With a view to regulating the placement and transfer of stocks by public companies, the China Securities Regulatory Commission (CSRC) has formulated and issued the Administrative Measures for the Regulation of Unlisted Public Companies (regulatory measures); the Guidelines for the Regulation of Unlisted Public Companies, No. 1: Information Disclosure; the Guidelines for the Regulation of Unlisted Public Companies, No. 2: Application Documents; and the Guidelines for the Regulation of Unlisted Public Companies, No. 3: Mandatory Provisions of Articles of Association. Furthermore, it issued the Management of National Equities Exchange & Quotations Ltd Interim Measures (interim measures).

The interim measures, the regulatory measures and the third set of guidelines further clarify the duties of NEEQ, enabling it to regulate public companies at the trading level. These regulations and regulatory documents are interlinked, constituting the regulatory and legal system governing public companies and patching the flaws in the public company regulatory system.