By Han Bin, Management World Magazine; Zhi Guangjie, Shandong Bureau of China Securities Regulatory Commission

Research Report, No.79, 2021 (Total 6144) 2021-4-2

Abstract: The 5th Plenary Session of the 19th CPC Central Committee has clearly noted that registration-based initial public offering (IPO) system will be advanced across the board, a delisting system as a normal practice needs to be established and the proportion of direct financing needs to be increased. In the reform of advancing delisting system as a normal practice, the protection for high-quality investors has become the focal point for pushing ahead with the reform of market fundamental systems and strengthening market supervision and regulation. In view of the overall performance of China’s delisting system and the protection for small and medium-sized enterprises’ investors, this paper gives an analysis of the choking points relating to the above-mentioned issue. For instance, the top-level design is not proactive, the connectivity between relevant laws and regulations is not smooth, the classified protection concepts are weak and the relief system is inadequate. It notes that in the course of registration-based IPO system reform, we need to strengthen the connectivity between laws of different levels, including corresponding laws and lower-level laws, for the protection of small and medium-sized enterprises’ investors, implement the protection measures for them in a classified fashion while taking delisting as a normal practice and establish the relief system with judicial relief playing the main role and compensation funds serving as subsistence assistance.

Keywords: delisting as a normal practice, investment protection, registration system