To the local branches of the China Securities Regulatory Commission (CSRC), all exchanges, affiliated units, associations, and relevant departments within the CSRC:
To the local branches of the China Securities Regulatory Commission (CSRC), all exchanges, affiliated units, associations, and relevant departments within the CSRC:
The establishment of the Sci-Tech Innovation Board (STAR Market) at the Shanghai Stock Exchange (SSE) and the pilot implementation of the registration-based IPO system are significant reforms personally announced, deployed, and promoted by President Xi Jinping. After more than five years of efforts, the effects of the STAR Market and the registration-based IPO system have been continuously amplified, playing an increasingly important role in supporting high-level technological self-reliance, improving the fundamental institutional framework of the capital market, and other areas.
To further implement the spirit of the Central Financial Work Conference and the deployment of the "Opinions on Strengthening Supervision, Preventing Risks, and Promoting the High-Quality Development of the Capital Market" (State Council Document [2024] No. 10) issued by the State Council, improve the "1+N" policy system for the capital market, deepen the reform of the capital market comprehensively, advance the registration-based IPO system, leverage the STAR Market as an experimental platform, and promote the development of new productivity and the national strategy to accelerate the construction of the "Five Centers" in Shanghai, we propose the following measures:
1.Strengthen the “Hard Tech” Positioning of the STAR Market.
Strictly enforce the entry requirements, resolutely apply the evaluation standards for technological attributes, and prioritize support for “hard tech” companies that make breakthroughs in key core technologies in emerging industries, new business models, and new technologies to list on the STAR Market. Further improve the mechanism for accurately identifying technology-based enterprises and enhance the role of market mechanisms. Given the characteristics of high investment, long cycles, and high uncertainty in R&D and commercialization in relation to new productivity companies, support high-quality, unprofitable tech firms with key core technologies and significant market potential to list on the STAR Market, thereby improving system inclusivity.
2.Pilot Reform of the Issuance and Underwriting System.
Optimize the pricing mechanism for new stock issuances, adjusting the proportion of high-priced shares to be excluded in the STAR Market’s new stock pricing. Improve the allocation arrangements for new stock issuance based on market capitalization and increase the minimum market value requirements for offline investors holding STAR Market stocks. Pilot a higher lock-up ratio and longer lock-up periods for offline investment institutions that issue public stocks for unprofitable companies, correspondingly increasing their allocation ratio. Strengthen the regulation of inquiry and pricing behaviors, and establish a “white list” system for offline professional investors, with stricter qualification restrictions for frequently high-bidding institutions.
3.Optimize the Stock and Bond Financing System for STAR Market Listed Companies.
Establish and improve a “green channel” for stock and bond financing and M&A of “hard tech” enterprises engaged in critical core technology research. Strengthen the review process for refinancing applications and improve efficiency for tech firms’ refinancing applications. Explore establishing criteria for “light asset, high R&D investment” recognition to support the use of raised funds for R&D purposes. Promote the pilot of shelf-style refinancing issuance on the STAR Market.
4.Increase Support for Mergers and Acquisitions (M&A) and Restructuring.
Support STAR Market listed companies in mergers and acquisitions (M&A) across upstream and downstream sectors to enhance industry synergy. Appropriately increase valuation flexibility for M&A and restructuring of STAR Market listed companies, supporting companies focused on enhancing their sustainable operational capacity to acquire high-quality, unprofitable “hard tech” firms. Expand the use of payment instruments, encourage the use of stock, cash, and convertible bonds in M&A transactions, and explore the feasibility of installment payments for stock-based deals. Support STAR Market companies in acquisitions aimed at enhancing their main business through mergers.
5.Improve the Stock Option Incentive System.
Strengthen the incentive and constraint mechanisms to encourage STAR Market listed companies to actively use stock options, better aligning the interests of investors and the company. Reinforce the constraints on stock option pricing, performance assessment criteria, and recipients, ensuring more accurate incentives for key team members and business backbones. Optimize the procedures for implementing stock option incentives, adjusting for short-term trading and window period regulations, and researching improvements to the allocation of stock option reserves.
6.Optimize Trading Mechanisms and Prevent Market Risks.
Strengthen trading supervision and ensure the smooth operation of the STAR Market. Research improvements to the market maker system and after-market trading mechanisms. Include STAR Market ETFs on the fund transfer platform and enhance the designated trading mechanism to improve transaction convenience. Continuously enrich the STAR Market index offerings, refine the index compilation methods, and enhance the “Shanghai Index” system. Expand STAR Market ETF categories and ETF options, and research the timely introduction of STAR 50 index futures and options. Optimize the registration mechanism for broad-based index products.
7.Enhance the Full-Chain Regulation of STAR Market Listed Companies.
Strengthen regulatory enforcement to ensure the protection of investors, especially the rights of small and medium investors. Combat fraudulent issuance, financial fraud, and other market irregularities with a stricter enforcement of responsibilities on issuers and intermediaries. Improve the information disclosure exemption system, supporting STAR Market companies in legally exempting the disclosure of sensitive information, such as commercial secrets. Strengthen positive incentives in regulatory policies and encourage founding teams and core technology talents to voluntarily extend their lock-up periods. Optimize the “reverse linkage” system for private equity and venture capital fund exits, supporting reasonable reduction demands. Strictly implement delisting regulations to prevent the emergence of “bad apples” or “zombie companies” in the STAR Market.
8.Create a Positive Market Ecosystem.
Improve the judicial protection system for the STAR Market, support the Shanghai Financial Court in innovating financial trial mechanisms for STAR Market-related financial cases, and support the Shanghai Financial Arbitration Court in piloting arbitration for STAR Market-related matters. Strengthen cooperation with local governments and relevant ministries, regularly visit STAR Market-listed companies to help resolve practical difficulties, and collectively enhance the quality of STAR Market-listed companies. Implement the “Quality, Efficiency, and Return Improvement” initiative, strengthen investor education services, and advocate for rational, value, and long-term investment principles to foster a positive market culture and investment culture for the STAR Market.
Issued by the China Securities Regulatory Commission
June 19, 2024
Announcement by the Ministry of Industry and Information Technology, Ministry of Finance, and the State Taxation Administration regarding adjustments to the technical requirements for energy-saving and new energy vehicles to enjoy vehicle and vessel tax exemptions.
Objective: The announcement aims to align with the development and technological advancements in the energy-saving and new energy vehicle industries, promote energy conservation, and encourage the use of new energy sources.
Key Points:
1.Updated Fuel Consumption Standards: The fuel consumption limits for energy-saving passenger cars, light commercial vehicles, and heavy commercial vehicles mentioned in the 2018 policy (Finance and Tax [2018] No. 74) are updated. Specific standards are provided in the attached documents.
2.Adjustment of Technical Standards for New Energy Vehicles: Adjustments to the technical standards for new energy vehicles, as outlined in Section 2(b) of the 2018 policy, are specified in the attachments.
3.Continuation of Other Technical Requirements: The remaining technical requirements for energy-saving and new energy vehicles to enjoy the vehicle and vessel tax exemptions will continue to follow the 2018 policy.
4.Implementation Date: The new regulations will take effect on July 1, 2024. The 2022 announcement (Announcement No. 2) will be repealed. For applications completed before July 1, 2024, the existing technical standards will continue to apply. After this date, new applications for tax exemptions must comply with the updated technical requirements outlined in this announcement.
5.New "Directory" of Eligible Vehicles: A new "Directory" for vehicles eligible for the tax exemptions will be announced starting from the 65th batch. The previous "Directory" (covering batches 4 to 64) will be invalidated, and eligible vehicles will automatically be transferred to the new directory. Those that do not meet the updated requirements must complete necessary adjustments before July 1, 2024.
6.Continuation of Exemptions for Vehicles Listed in the Previous Directory: Vehicles that have already been listed in the 4th to 64th batch of the directory will continue to benefit from the tax exemption policy, regardless of whether they are transferred, until the new directory is published.
Ministry of Industry and Information Technology
Ministry of Finance
State Taxation Administration
Date of Issue: May 27, 2024.
Announcement by the Ministry of Finance, General Administration of Customs, and the State Taxation Administration on the increase in the tax exemption limit for personal belongings carried by residents entering from Hong Kong and Macau.
Objective: The announcement aims to adjust the tax exemption limits for personal belongings carried by residents entering from Hong Kong and Macau, in line with the updated provisions of the "Closer Economic Partnership Arrangement" between Mainland China and Hong Kong, and the "Closer Economic Partnership Arrangement" between Mainland China and Macau.
Key Points:
1.Increased Exemption Limit for Personal Belongings: For residents aged 18 and above entering from Hong Kong or Macau, personal reasonable self-use belongings with a total value of up to 12,000 RMB (including 12,000 RMB) will be exempt from tax. Additionally, for travelers arriving at ports with duty-free shops, a certain quantity of duty-free goods can be purchased, and the total value of personal belongings and duty-free goods (purchased at the port) can be up to 15,000 RMB (including 15,000 RMB) for tax exemption.
2.Exemption Limits for Travelers Entering Hengqin: When residents travel from Macau through the "first line" into the Hengqin Guangdong-Macao In-depth Cooperation Zone, the current exemption rules will apply to their personal belongings. However, when traveling from Hengqin through the "second line" into Mainland China, the exemption limit for personal belongings will follow the updated rules mentioned in the first point of the announcement.
3.Other Regulations Remain Unchanged: The existing regulations regarding the transport of personal belongings by travelers making frequent trips between Hong Kong, Macau, and the Mainland remain unchanged.
4.Implementation Schedule: The new measures will be implemented from July 1, 2024, at six pilot ports: Luohu, Futian, Shenzhen Bay, West Kowloon Station of the Guangzhou-Shenzhen-Hong Kong Express Rail Link, Gongbei, and the Zhuhai section of the Hong Kong-Zhuhai-Macao Bridge. From August 1, 2024, the measures will be expanded to all entry ports (except the Hengqin "first line" port).
Ministry of Finance
General Administration of Customs
State Taxation Administration
Date of Issue: June 27, 2024.
