The Financial Supervisory Commission (FSC) is reported to be planning to lower primary listing thresholds for foreign-registered companies using Chinese capital, in the hope of attracting quality firms based in China and boosting local capital markets.
The commission intends to grant easy review of foreign-registered companies seeking a primary listing in Taiwan, as long as Taiwanese shareholders have substantial control of the firms and Chinese capital is capped below 50 percent, from the current 30 percent, the Chinese-language Economic Daily News said, without citing sources.
The move, likely to take effect next month, pending cross-ministerial coordination, struck a contrast with the commission’s rejection in late May of the application for a primary listing on the over-the-counter market by Cayman Islands-registered China Crystal New Material Holdings Co (中國晶體新材料控股), a China-based mica powder producer.
The commission’s tightened stance toward companies with a Chinese base drove Huafu Industrial Ltd (華福實業), a maker and vendor of bamboo shoot products, to withdraw its application last week.
The newspaper said the commission’s upcoming relaxation would fall in to line with the trend toward liberalization and should provide more motivation for firms that wish to seek a primary listing in Taiwan. Many that are rejected end up operating out of Hong Kong or South Korea instead.
The rumored deregulation would benefit reputable Taiwanese companies with operations in China, the report said.
The commission might also ditch special listing applications for foreign-registered companies with Chinese capital below 50 percent, but in excess of 30 percent, the report said.
The treatment would bring the China-companies registered owned by Taiwanese on par with Taiwanese companies registered overseas in terms of listing procedures, the newspaper said.
The commission did not confirm the report.
Any relaxation by the commission regarding the listing threshold for Chinese firms still has to obtain approval from the Mainland Affairs Council and the Cabinet before it can be put into practice, the report said.
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