1st Self-discipline Committee of SSE STAR Market Holds Working Meeting, Advocates Compliance in IPO Business

21 Sep 2020

On September 21st, the 1st Self-discipline Committee of the STAR Market of the Shanghai Stock Exchange (SSE) held its 8th working meeting and published industry advocacy regarding new circumstances in recent IPOs. Relevant officials of the SSE and the Securities Association of China attended the meeting.

At the meeting, the institutional members had a focused discussion and in-depth exchange on the recent situation of inquiry and pricing of new shares on the SSE STAR Market. The institutional members expressed that since the construction and operation of the board, all key systems have been reformed in a market-oriented and legalized way, which has initially formed a "test field" of reform that sets examples, guide the way, and has international competitiveness, and has made due contribution to enhancing the ability of the capital market to serve scientific and technological innovation. At the same time, the participating institutional members pointed out that recently, with the increase in the supply of new shares, some offline investors are suspected of "negotiated quotes" when participating in the subscription process of new shares, and some lead underwriters failed to write independent, prudent and standardized investment value research reports. As a result, Self-discipline Committee of the SSE STAR Market issued an advocacy letter, suggesting all institutional members to conduct self-examination of internal compliance management and to commit to participating in the STAR Market IPO business in accordance with laws and regulations. Furthermore, the Self-discipline Committee called on all market participants to strictly comply with the underwriting business rules for IPOs on the STAR Market, the buy side institutions to follow the principles of independence, objectivity and integrity in the quotation for new shares, and the sell side institutions to improve the seriousness, objectivity and professionalism of business activities such as the production of investment value research reports, so as to jointly maintain the order of IPOs on the STAR Market and actively create a good investment and financing ecology.

The SSE recognizes and supports the Self-discipline Committee in performing its duties effectively and playing the role of industry self-discipline. At the same time, the SSE also calls upon market institutions to adhere to the requirement of "Four Humbleness and One Cooperation", to adhere to the bottom line of legal rules and to participate in the market in a rational and compliant manner in accordance with the relevant recommendations of the Self-discipline Committee. The SSE will resolutely take appropriate self-regulatory measures against any illegal activities in the issuance process of new shares, so as to maintain the healthy and stable development of the STAR Market and safeguard the hard-won situation of reform.