U.S. media reports, Chinese law firms are required to disclose the disclosure of China's economic risks to avoid mentioning negative changes in the economy.
According to the Wall Street Journal of the United States on Friday (August 11), people familiar with the matter revealed that at the closed -door meeting of the China Securities Regulatory Commission, a group of domestic law firms were required to be at the closed -door meeting last month.In the company's overseas listing documents, it dilutes the wording of the disclosure of China's economic risks.
Officials require lawyers to avoid mentioning "negative changes" when describing the Chinese economy, and describe it as "constantly changing"; lawyers are also suggested that China's administrative and judicial procedures may be delayed.It only needs to simply point out that the Chinese legal system is different from other jurisdictions.
The guidelines received by lawyers are: Do not say that Chinese laws and regulations will change without notice, but the word "sometimes" in Chinese law may change.
After the China Securities Regulatory Commission released a new regulations for overseas listing overseas in March this year, it has been reviewing the proposal listing plan and information disclosure of enterprises.These documents must be approved by the China Securities Regulatory Commission, and companies can go to the United States or Hong Kong IPO.
According to this provision, enterprises, lawyers and investment banks shall not make remarks that degrade Chinese laws and policies, business environment and judicial conditions.
In addition, the Hong Kong Stock Exchange will no longer require the registered company in mainland China to explain in detail the risks related to the control of Chinese politics, law, commercial and economic environment, and RMB and foreign exchange control.However, companies applying for listing must still disclose all major risks including Chinese risks.
According to people familiar with the matter, some domestic IPO lawyers support the above adjustments, and when they are preparing to apply for listing in the United States, they have diluted some of the wording of Chinese risks and shortened the relevant space.
But this requirement has also confused some market participants, because many listed companies have pointed out China's economic risks in annual reports, bond issuance documents and other types of regulatory announcements.
It is reported that the risk of decoration in the announcement of the stock exchange may cause trouble to listed companies and their lawyers, because the purpose of these documents is to protect listed companies from legal proceedings after the stock price falls sharply.
Chen Zhiwu, a professor of finance at the University of Hong Kong, said: "As long as the issuer of the stock clearly discloses the advantages and disadvantages, even if those bad things really happen (I hope it will never happen), they will not be held accountable."
