In March this year, the State Council issued an important approval for the construction of Zhongguancun National Independent Innovation Demonstration Zone, which is an important decision made by the Party Central Committee and the State Council in the new historical period to promote independent innovation and accelerate the construction of an innovative country. It is an urgent need for Beijing to implement the scientific concept of development and accelerate the optimization and upgrading of industrial structure and the transformation of development modes. Building Zhongguancun National Independent Innovation Demonstration Zone is not only an important opportunity and mission for Zhongguancun’s innovation and development, but also an important task for Beijing to build “Science and Technology Beijing, Humanities Beijing, Green Beijing”.
In order to implement the State Council’s approval on the construction of Zhongguancun National Independent Innovation Demonstration Zone, we should deepen the pilot project of scientific and technological financial reform and innovation in Zhongguancun, and promote the enterprises in the zone to become stronger and bigger with the help of multi-level capital market. After the China Securities Regulatory Commission and the China Securities Association issued and improved the pilot system of stock quotation transfer in Zhongguancun, on June 24, the market department of the China Securities Regulatory Commission, the torch center of the Ministry of Science and Technology, the China Securities Association, the Shenzhen Stock Exchange and the Zhongguancun Administrative Committee jointly convened the pilot work meeting of stock quotation transfer in Zhongguancun agency system. The conference summarized the work of the pilot project in the past three years and interpreted the new pilot system. Leaders of Beijing relevant committees and bureaus, district and county governments, Zhongguancun sub-parks management committees and co-construction bases, leaders of associations, overseas students’pioneering parks, University Science and technology parks, incubators, securities companies active in the parks, accountants’ firms, law firms, credit intermediaries, and more than 200 executives of enterprises to be listed in Zhongguancun agency system participated in the meeting. Discussion. At the meeting, the opening ceremony of the “Zhongguancun Pilot Listed Enterprise Financial Services Alliance for Share Quotation Transfer” was held, which was composed of brokers, banks, securities information companies, rating agencies, accounting firms, law firms and other professional intermediary services. The Bank of Beijing has signed equity pledge loan agreements with Wuyuexin Company, Bank of Communications and World Oriental Company. These measures, together with the previous series of activities such as “Zhongguancun Park Agent Enterprise 2008 Performance Online Roadshow” and so on, constitute a value-added financial service support system for Agent Listed Enterprises.
Signing of Equity Pledge Loan Agreement with Banks for Listed Enterprises
The Founding Ceremony of Zhongguancun Financial Service Alliance for Share Transfer Pilot Project
With the approval of the State Council, the pilot share quotation transfer project of Zhongguancun agency system was officially launched in January 2006. Its main purpose is to explore the construction mode of the over-the-counter market in China’s multi-level capital market system, and explore specific ways to use the capital market to support innovative enterprises such as high-tech enterprises. It is a concrete measure to implement the spirit of the National Science and Education Leading Group Meeting and the National Science and Technology Congress. It is also an important innovative measure for the construction of multi-level capital market in China. It is of great significance to satisfy the diversified financing needs of enterprises at different stages of development, promote the development of venture capital and private equity, enhance the ability of independent innovation and promote the development of high-tech industries.
With the approval of the State Council, the pilot share quotation transfer project of Zhongguancun agency system was officially launched in January 2006. Its main purpose is to explore the construction mode of the over-the-counter market in China’s multi-level capital market system, and explore specific ways to use the capital market to support innovative enterprises such as high-tech enterprises. It is a concrete measure to implement the spirit of the National Science and Education Leading Group Meeting and the National Science and Technology Congress. It is also an important innovative measure for the construction of multi-level capital market in China. It is of great significance to satisfy the diversified financing needs of enterprises at different stages of development, promote the development of venture capital and private equity, enhance the ability of independent innovation and promote the development of high-tech industries.
Over the past three years, the number of listed companies has gradually increased, the overall operation is stable and orderly, and the expected goals have been basically achieved. The role of supporting the development of independent innovation enterprises in the park has initially emerged. Up to now, 85 enterprises have participated in the pilot project, of which 57 have been listed and registered, 10 are being registered, and more than 80 are expected to be listed by the end of the year. Listed companies cover software, biopharmaceuticals, new materials, cultural media and other emerging industries. Nine listed companies have completed a total of 10 directional additional shares, raising 466 million yuan, with an average P/E ratio of 16.38 times. The pilot project initially established the regulatory system arrangement and basic operation mode of non-listed joint-stock companies for share transfer, which accumulated experience for exploring the establishment of a national off-site market under unified supervision.
Summarizing the three-year experience of the pilot project and improving the pilot system is another important measure for China Securities Regulatory Commission to promote the construction of multi-level capital market after issuing the GEM IPO management measures. It is also a specific measure to implement the approval of the State Council for the construction of Zhongguancun National Independent Innovation Demonstration Zone. It will be conducive to improving the service efficiency of the pilot project and attracting venture capital. It will create conditions for the establishment of the share transfer system of non-listed companies under unified supervision relying on the Zhongguancun pilot project.
Zhongguancun Science and Technology Park is the first state-level high-tech park approved by the State Council. It is the largest science and education intellectual resource-intensive area in China. It is also the center of science and technology innovation and the base of high-tech industry development in China. It has fostered a large number of leading enterprises and innovative enterprises in the industry, and has rich resources for innovation and entrepreneurship. The State Council has chosen to carry out pilot projects in Zhongguancun, which is conducive to giving full play to the role of pilot demonstration and guidance for the whole country. After the implementation of the new pilot system, Zhongguancun should further play the role of pilot, laying a good foundation for expanding the scope of pilot to other qualified high-tech zones in due course.
According to the new system, especially after adjusting the conditions of listed companies from three years to two years, more enterprises will meet the requirements of listing. All parties expressed that they should seize the opportunity of the system adjustment, publicize and promote the new pilot system through various channels; study the relevant policies and measures to promote the development of the pilot listed companies, and organize a group of enterprises to enter the agency system as soon as possible. Listing; Actively promote the establishment of a green channel and transfer mechanism for listed companies to go to GEM and motherboard.
Speech by Deng Yingling, Vice President of China Securities Association, on the Pilot Workshop of Share Quotation Transfer in Zhongguancun
Good afternoon, ladies and gentlemen.
Three years ago, with the approval of the State Council and the China Securities Regulatory Commission, we carried out a pilot share quotation for Non-listed Companies in Zhongguancun in order to explore the construction mode of the off-market market of China’s capital market and explore specific ways to use the capital market to support the development of high-tech enterprises. This year, under the leadership of the China Securities Regulatory Commission (CSRC), after the GEM and IPO re-launch, the Securities Industry Association summed up three years of pilot experience. In order to improve the efficiency of the market, it put forward five specific contents of improving Zhongguancun’s agency transfer system, namely, implementing appropriate management for investors, adjusting the conditions of listed companies, improving the transfer transaction settlement system, and improving the information disclosure system. Degree and improve the system of limited sale of shares.
Looking at the whole world, no country has formulated a special capital market system for the share transfer of Listed Companies in a region. When we designed the pilot project of the agency transfer system of Guancun three years ago, we did not study Guancun on the basis of Zhongguancun, but focused on establishing a national off-site market. Especially this year, after the launch of GEM, we improved the agency of Zhongguancun. The pilot system is mainly considered in the following three aspects.
The first aspect is the difference. There was no GEM when Zhongguancun agency transfer pilot was launched three years ago. Now GEM has come out and IPO has been restarted. So we consider the differences between Zhongguancun agency transfer system and the main board and GEM, which are mainly reflected in the following five points.
The first is the target of listing. Both the agent transfer system and GEM support the development of science and technology enterprises, but they are different. GEM mainly supports mature science and technology enterprises, while the agent transfer system supports enterprises with certain products, modes and initial stages of development. Therefore, in the system design, different from GEM, enterprises have two years of operation qualification to participate in the pilot, and the main board and GEM must be three years, this improvement is mainly to enable more technology-based enterprises to enjoy the support of the capital market earlier.
The second point is investor limitation. One of the most important contents of multi-level market is that investors are multi-level, the main board is all investors will invest, GEM has two years of investment experience investors can, and agency transfer system stipulates that at present can only be institutional investors, because the risk of agency transfer system is higher than GEM.
The third point is the stock trading liquidation system. The motherboard implements the guaranteed delivery of multilateral bidding, while the agent transfer system implements the non-guaranteed delivery of the whole amount one by one.
The fourth point is the information disclosure system. In information disclosure, the motherboard has annual report, semi-annual report and quarterly report. All information supervision is completed by Shenzhen Stock Exchange and Shanghai Stock Exchange. The agency transfer system requires disclosure of annual and semi-annual reports without quarterly reporting requirements, while the sponsor securities firm assumes the information supervision responsibility of the exchange.
The fifth point is the review and filing system. The main board implements the auditing system and the transfer agent system implements the filing system. In this reform, we will reduce the filing time from 60 days to 50 days, so as to improve efficiency, in order to promote the listing of companies as soon as possible.
The difference mentioned above is the reason for our reform.
The second aspect is legitimacy. Because the quotation system listed companies are non-listed technology companies, for the Securities Law and Company Law, this reform mainly reflects its legitimacy. There are three specific points:
The first point is that the issuance or transfer of shares of listed companies must be lawful and compliant. This is a new addition to the system adjustment, because the agency system is the market under the unified supervision of the SFC. It is prepared for the future transfer of shares to the main board and GEM. Those who illegally transfer shares can not be listed in the agency system.
The second point is the mode of transfer. The exchange is a pricing transaction, and the agent transfer system is actually a kind of agreement transfer. The motherboard is a price-first, time-first, agent transfer system, and time-first under the same price. It is totally different from the motherboard, different ways of trading.
The third point is the financing function of the agent transfer system. Nine companies have made ten financing trips in the three years of the pilot project, of which Time Science and Technology has made two. Suning Electric Appliances has made two financing in the main board in three years, two financing in the agency transfer system, and two financing in the three years of Time Science and Technology Listing. The financing of the motherboard is called directional financing, and the financing of the agent transfer system is called directional capital increase. It is private and can not be made public. Prices and investors must be determined in advance before the board of directors makes a decision.
This year, financing has shown a trend of substantial growth. Recently, six companies are preparing to increase their capital in a directional way. Now, a United Flying Technologies company is doing, with a price-earnings ratio of 22 times. Recently, five companies have planned to raise funds. One company investor has found out that the amount of financing is more than 90 million, nearly 100 million, which is equivalent to the size of a GEM. The financing efficiency of the agent transfer system is particularly high. It realizes small and fast financing. It takes about four months from the decision of the shareholders’meeting to the approval of the securities industry association to the money, which is much lower than the time and cost of the IPO.
The third aspect is called unification, which means that we should consider building it into a national off-site market when we pilot in Zhongguancun. In this respect, the following six points are reflected in the improvement of the system:
The first point is the unification of accounts. In the past, the agency transfer system had a separate account, this time it was unified as the main board account of Shenzhen Stock Exchange.
The second point is the unification of settlement funds. In the past, China Construction Bank used to settle accounts. This time, it was unified as the third-party undertaking of the main board. That is to say, there is a capital card and two code cards on the main board market. The card of Shenzhen Stock Exchange can not only buy and transfer system stocks, but also buy GEM and SMEs. The third-party undertaking is unified with the main board.
The third point is the unification of restrictions on the sale of shares. In the past, all shareholders, big or small, had to circulate in three years. This time, like the motherboard, they controlled the first largest shareholder and the unanimous actors and circulated in three years. All other shareholders could circulate on the first day of opening.
The fourth point is the unification of share transfer information. In the past, we could only see the market information on Shenzhen’s agent transfer information platform. This time, 3360 business departments and 941 service departments of 106 securities companies approved by the SFC were changed to send information to securities companies all over the country at the same time. After July 4, all securities companies can see the real-time implementation of the agent transfer system.
The fifth point is the unification of stock trading methods. In the past, we could only buy and sell at the counter, but no other way was possible. This time, like the motherboard, it could be self-help at the counter, through the telephone, or through the Internet, which greatly improved its efficiency.
The sixth is the unification of trading systems. The transaction system including directional capital increase is a unified national standard provided by Shenzhen Jiaotong.
These six unifications show that this is the embryonic form of a national OTC market.
We believe that through this reform and improvement, especially through your efforts, Zhongguancun agency transfer system will be built into a nationwide over-the-counter market with controllable risks and high market efficiency under the unified leadership of the China Securities Regulatory Commission, which will provide better services for nationwide independent innovation companies. This goal will certainly be achieved.
Thank you!
Speech by Chen Hongqiao, Deputy General Manager of Shenzhen Stock Exchange, on the Pilot Workshop of Share Quotation Transfer in Zhongguancun
Good afternoon, ladies and gentlemen.
Three years ago, in order to explore the construction mode of China’s capital market off-site market and explore specific ways to use capital market to support the development of high-tech enterprises, with the approval of the State Council, a pilot project was carried out in Zhongguancun to transfer share quotations of non-listed joint stock companies. Since April this year, Shenzhen Stock Exchange and Zhongguancun Administrative Committee have discussed three things in detail:
The first thing is equity pledge. Discuss the equity pledge loan of listed companies to reflect the value of equity.
The second thing is to integrate financial resources. Let sponsors, venture capitalists, commercial banks and other financial means and financial resources be combined to form a new mode of financial cooperation.
The third thing is how to do a good job of information service. Let Shenzhen Securities Information Company, which belongs to Shenzhen Stock Exchange, study how to carry out information service around Zhongguancun listed enterprises in providing concentrative roadshow, concentrating on publishing enterprise performance information and providing stock trading statistics information.
These three things have achieved a preliminary result in a short period of three months. They are the result of our recent earnest understanding of the basic ideas of CSRC and China Securities Association on OTC market construction. We will continue to improve in the process of exploration and make some new attempts based on medium-term and long-term development.
In today’s meeting, I would like to make four points:
The first point is to integrate financial resources. In order to build Zhongguancun into a demonstration zone of national independent innovation, the key lies in the combination of scientific and technological innovation and financial innovation, forming a combination of scientific and technological innovation and financial innovation. Integration of various types of financial resources, including commercial banks, credit guarantee, micro-loans, angel investment, venture capital, industrial funds, sponsors, venture capital institutions. There is also a need to innovate financial services tools and means to meet the diverse needs of small and medium-sized enterprises and high-tech enterprises at different stages of growth. In particular, we need to give full play to the leverage, demonstration and driving role of the capital market.
It is also an important support point for us to promote the combination of scientific and technological innovation and financial innovation in Zhongguancun by conducting pilot share price transfer and integrating various financial innovation means such as government, bank, securities company, guarantee and venture capital.
The second point is that on the basis of summing up the experience of the pilot project, the pilot project of Zhongguancun Agency Transfer will gradually expand the scope of the pilot project in an orderly manner. The goal is to build an over-the-counter market under unified supervision.
In the process of entering this market, we have three basic tasks:
The first task is to build a platform for non-listed companies to transfer shares. We should devote ourselves to building the quotation transfer system into a platform for the smooth circulation of shares of non-listed companies and market bidding. Nowadays, the number of joint-stock companies has doubled. Share transfer is the natural demand of joint-stock companies.
The second task is to build a venture capital gathering center. To build the quotation transfer system into a gathering center of venture capital and equity private equity funds, there have been obvious results recently. Many venture capital companies have piled up in Zhongguancun to find high-quality and potential enterprises in Zhongguancun. The listed companies of quotation system are the ideal target. In the future, this quotation system will be an important platform to promote the connection between listed companies and investment institutions.
The third task is to make the quotation transfer system an incubator and reservoir of listed resources in multi-level capital market. We have huge reserve listing resources. There are many companies that can be listed in the short term. But small and medium-sized boards, including the GEM we are about to launch, can not solve the listing problem of all enterprises in the short term. A large number of enterprises need to practice in such a system. Through such an open information disclosure training, through intermediaries to regulate these enterprises. Counseling can help listed companies to meet the requirements of listing earlier, and to restrain and regulate themselves as soon as possible according to the requirements of the capital market.
The third point I want to say is to build a cooperative mechanism of financial services for SMEs. We should use the quotation transfer system to discover and realize the added value of standardization of enterprise shares. After the standardization of shares, like other commodities, it is more convenient to enter the market for circulation and transfer, to price shares in the market, and to introduce different types of investors according to demand.
By summing up the experience of Zhongguancun pilot project, we can see that the enterprises listed in the quotation transfer system have a series of requirements, such as stock reform, due diligence, stock confirmation, centralized trusteeship and information disclosure, which can improve the degree of standardization and standardization of enterprises’shares. On the one hand, the supervision and assistance of professional institutions such as sponsoring securities firms and continuous information disclosure can enhance the credibility and credibility of listed companies, and improve the effect of introducing strategic investors such as equity investment and private equity funds. On the other hand, the characteristics of listed companies, such as clear ownership and transparent market transfer price, create a relatively relaxed condition for introducing other financial innovative means and exploring equity pledge. For small and medium-sized enterprises and high-tech enterprises, the valuable thing is equity. If equity can be pledged, more strategic investors will be introduced after the equity confirmation standardization, which will provide pre-preparation for bank credit. Now the venture capital institutions and sponsors have actually done some pre-bank work.
The fourth point is to provide value-added services for listed companies with the help of various resources. There are more than fifty listed companies now, which will form a certain scale in the future. We can carry out market planning and provide some corresponding value-added services for listed companies. First, the next step should be to cultivate institutional investors, especially equity investment institutions, so that our agency system becomes a place that venture capital institutions often patronize. Secondly, we should help enterprises innovate financing means and become an important platform for investment and financing of listed enterprises; thirdly, our intermediaries should be good financial advisers of listed enterprises and introduce innovative financial means and financial varieties; fourthly, we should promote listed enterprises to improve the quality of information disclosure, improve corporate governance, make preparations, and meet the requirements of listing as soon as possible; fifthly, we should follow the guidelines. In the past two months, Shenzhen Securities Information Corporation and Zhongguancun Management Committee under the Shenzhen Stock Exchange have jointly organized two groups of 14 annual performance concentrate roadshows for listed companies. This is a low-cost channel for very small enterprises to quickly communicate with the national media and investors all over the country. We will be here in the next step. Further in-depth study on some aspects will make the information of listed companies reach more corners quickly, and make more investors fully aware of the investment value of our listed companies.
In short, under the unified deployment and leadership of the SFC, the Shenzhen Stock Exchange actively cooperates with the China Securities Industry Association, jointly with the Zhongguancun Administrative Committee and relevant intermediaries, and makes the various services specially and meticulously, which makes the transfer pilot project of Zhongguancun agent become a successful case in Zhongguancun National Independent Innovation Demonstration Zone and has a positive demonstration effect.
Thank you!
Source: Zhongguancun Management Committee website time: 2009-7-1