China to go to sea and tide

A-share IPO stage, compared to other enterprises, such as the plight of different queues, with the Internet as a significant representative of the enterprise, traveled to overseas listing, Alibaba to the U.S. listing, and again set off a new wave of the U.S. listing spree.

The market laments the loss of quality resources and the allure of overseas capital markets to attract these companies to roamed overseas. The reason may be from the http://www.aliyun.com/zixun/aggregation/4337.html of the two markets, "> Prospectus.

Differences in Prospectus writing

No matter a share or an overseas market prospectus, there are different rules and practices, the prospectus alone in writing and format, there are significant differences.

The first is the format of the prospectus.

The Chinese Securities Regulatory Commission (CSRC) revised the content and format of the prospectus in 2006, which is now widely used as the "one standard". In overseas markets, for example, the local Securities and Futures Commission, in addition to the content and format of the prospectus to make the relevant requirements, the different nature of the application of the form is completely different.

Alibaba, as well as the former Beijing-east and Baidu, need to submit F-1 forms for U.S. listings, while US companies, such as Facebook, apply the S-1 form when they are to be listed.

According to a US local source, according to the SEC, the S-1 form is mainly applicable to domestic companies ' listing statements, meaning the IPO process is officially started, while F-1 is mainly used in some companies outside the United States to register the listing.

The second is the difference in the specific composition of the prospectus.

"A shares and the U.S. stock in the specific format there are very many differences." "The most important thing is that the authors of the prospectus are different and the effects are different," said a US-funded official in an interview with the 21st century Economic report. ”

According to the people of the Capital Management company, U.S. prospectuses are generally written by lawyers and investment banks, where lawyers do most of the work, and investment banks are more likely to be involved in the relevant business chapters, and the SEC, in any doubt, will also choose to communicate with lawyers and accountants and will not contact the investment bank.

"The role of lawyers in the listing process is critical, especially in the prospectus chain." "The financial management company told the 21st century economic reporting reporter.

A-shares use the sponsor system, most of the listed companies issued prospectuses are written by sponsors or underwriters, lawyers are rarely involved. Although the Hong Kong stock market also adopts the sponsorship system, the prospectus of listed companies of Hong Kong is mainly completed by lawyers.

"Different writers, to understand the prospectus is not the same, the effect is different, such as the sponsor may be more sensitive to the number, the market, but the text and the legal perspective of the understanding may not be thorough, this will have a certain impact on the prospectus." An investment banker in China told the 21st century economic reporter.

It is noteworthy that in the U.S. stock market, every time the prospectus has been revised to open, not only that, the SEC's audit opinion, the issuer's response to be open, which provides a strong guarantee of transparency of the company.

Information Disclosure Differences

Apart from the composition and format differences of the prospectus, information disclosure is also a place of great difference.

The domestic and foreign regulations are different in terms of the specific situation of raising funds.

In the SEC-related regulations, there is a clear provision for the issuer to raise funds. One of the provisions (the fourth provision of the S-1 registry) shows that for domestic listed companies, the issuer should disclose the main purpose of the fund-raising and the approximate amount of each use. This in the A-share market also has detailed provisions, including the use of each fund, and whether the audit and other related information.

The difference between the two markets is beginning to be reflected in the absence of any identified use of fund-raising.

The U.S. stock market has made it clear that issuers are allowed to make corresponding disclosures and explain the reasons for their release. But the A-share market does not indicate whether companies are allowed to say there is no clear purpose for raising funds.

The 21st century economic reporter, flipping through several U.S. stock prospectuses, found that the most common reason for the lack of a clear use of funds was "corporate liquidity and other general uses." ”

In addition, the disclosure requirements for competition between the two sides are also different.

Because most of the domestic issuers have holding shareholders, and the relative concentration of equity, so a-share prospectus often requires detailed disclosure of competition.

In the United States, the majority of listed companies are quite dispersed, even if there is a more concentrated issue of equity, according to the situation of companies such as Facebook, the SEC will require these large shareholder companies to sign an anti-competitive agreement to manage, and will not be forced to disclose in the prospectus, and shareholder commitment to management.

In addition to the above two, overseas prospectus, the United States and European countries for the underwriters, underwriting, and other requirements of a more detailed disclosure, in the Chinese capital market is rarely seen in the prospectus, while the overseas prospectus also will be the body of the prospectus and its earnings, while in China, usually use an additional separate "financial information" Chapter to explain the corresponding financial situation and the basis of preparation and so on.

It is not difficult to see that domestic and foreign prospectuses, whether information disclosure or specific writing, even the author is very different.

But with the United States ' disclosure guidelines in line with the International Securities Organization (IOSCO) 's demand for prospectus disclosure, and in line with the disclosure practices of major capital markets, including the US and the European Union, the U.S. stock prospectus is more widely accepted. (Edit Bujian)