December 4, 2018 / 2:58 AM / 13 days ago

China will likely publish rules for new tech board in January: 21st Century

FILE PHOTO: A customer takes a picture as robotic arms collect pre-packaged dishes from cold storage, done according to the diners' orders, at Haidilao's new artificial intelligence hotpot restaurant in Beijing, China, November 14, 2018. REUTERS/Jason Lee

SHANGHAI (Reuters) - China will likely publish rules for Shanghai’s planned “technology innovation board” in January, and will launch the new tech board before June, the 21st Century Business Herald reported on Tuesday, citing unidentified sources close to the Shanghai Stock Exchange.

Companies with core technologies can start submitting listing applications as soon as in March or April, but firms with unproven technologies such as blockchain, or in traditional industries such as finance or real estate will be disqualified for listing on the new board, the newspaper added.

Plans for the technology innovation board were unveiled by Chinese President Xi Jinping early last month. The board will adopt a loosely-regulated mechanism for initial public offerings (IPOs), potentially competing with Hong Kong, or even New York.

According to the newspaper, applicants will not be required to be profitable, but must meet certain threshold in terms of revenue and capitalization.

The new board may also adopt a more flexible trading system, granting stocks more room to rise or fall, and allowing investors to sell shares on the same day of purchase, according to the article. Currently, Chinese stocks are allowed to rise or fall a maximum of 10 percent on a single trading day, and investors can not sell shares on the day of purchase.

Reporting by Samuel Shen and John Ruwitch; Editing by Subhranshu Sahu

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