HKEX Proposes Extension of its Secondary and Dual Primary Listing Regimes

Julia Charlton

Partner, Charltons

The Hong Kong Stock Exchange’s Consultation Paper on the Listing Regime for Overseas Issuers1 published on 31 March 2021 (HKEX Consultation Paper) proposes potentially far reaching changes to its requirements for secondary and dual primary listings of overseas companies on the Hong Kong Stock Exchange (the HKEX).

Two of the key proposals, which are the subject of this newsletter, are:

  1. to expand the secondary listing regime for overseas-listed Greater China companies from traditional sectors (i.e. companies not meeting the definition of “innovative” companies as set out in HKEX Guidance Letter GL94-182) which do not have weighted voting rights (WVR) structures; and
  2. to allow companies to dual primary list on the HKEX while maintaining their existing weighted voting rights structures and variable interest entity (VIE) structures.

The HKEX Consultation Paper’s third major proposal, to simplify the listing regime for overseas companies by removing the current distinction between Acceptable and Recognised Jurisdictions and to require all companies listing on the HKEX to meet a core set of 14 shareholder protection standards, is the subject of a separate newsletter, HKEX Proposes Simplification of HKEX Listing Regime for Overseas Issuers.3 For an overview of the Consultation Paper’s proposed changes, please see Charltons’ newsletter The HKEX Consultation Paper on the Listing Regime for Overseas Companies.4

The consultation period will expire on 31 May 2021.

 

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