Hong Kong Exchanges and Clearing Limited (HKEX) and The Stock Exchange of Hong Kong Limited (the Exchange) on Friday, 15 December 2017, announced the conclusions to the New Board Concept Paper (Concept Paper) published on 16 June 2017.

On the same day,  the consultation conclusions on the Consultation Paper on the Review of the Growth Enterprise Market (GEM) and Changes to the GEM and Main Board Listing Rules (GEM Consultation Paper) were also published.

Together, these would bring new important changes to Hong Kong’s listing regime, especially including measures to facilitate listings of companies from emerging and innovative sectors, and aimed to enhance Hong Kong’s competitiveness as a global financial centre.

As announced by the Exchange on its official website:

The Exchange has determined to proceed to expand the existing listing regime by introducing two new chapters to the Main Board Listing Rules to allow the listing of (i) Biotech issuers which are pre-profit / pre-revenue; and (ii) issuers from emerging and innovative sectors that have weighted voting rights (WVR) structures, subject to additional disclosure and safeguards.

Companies with WVR structures would be required to have a minimum expected market capitalisation of $10 billion and, if below $40 billion of market capitalisation, would need to meet a higher revenue test of $1 billion in the full financial year before listing. Pre-revenue companies listing under the new Biotech chapter would be required to have a minimum expected market capitalisation of $1.5 billion.

Detailed proposed amendments to the existing Listing Rules for the implementation of the changes are expected to be available for consultation in the first quarter of 2018, with anticipation to have the market ready by second half of 2018 for more innovative companies choose Hong Kong as listing destination.

HKEX’s official news release contains further information on the proposals and way forward.