Growth enterprise board may launch in October

BEIJING, May 11 -- The country's long-awaited
NASDAQ-style second board could start around October with 40 listed firms, it
was suggested yesterday.

The opening of the second board, or growth enterprise
board (GEB), has been timed to coincide with the completion of the initial
public offering reform on the main board.

New listings were suspended in September last year
because of excessive pricing abuse and the China Securities Regulatory
Commission is drafting new rules to plug loopholes.

"We expect the new market regulations to be completed
in August, when we will begin explaining the requirements to intermediaries,
corporations and investors," Wang Wenli, a member of the Shenzhen Stock Exchange
(SSE), said.

The SSE released the draft listing regulations for
the GEB on Friday and has started soliciting public opinion.

"It will take two weeks to solicit opinion, then the
formal regulations can come out. The transaction regulations for the GEB can be
expected in two weeks, which will specify the capital threshold for investors,"
said Wang, who denied rumors the threshold could be as high as 300,000 yuan
($44,000).

"Based on research on the small and medium-sized
enterprises board, investors that are actively speculating usually have less
than 30,0000 yuan in capital. The 50,000-yuan threshold might be high enough to
avoid over-speculation."

Outstanding issues also include whether companies
listed can transfer to the main board or other markets when they meet
requirements.

Professionals who joined a forum to discuss the
proposals welcomed the efficient delisting scheme of the GEB and also suggested
shortening the lock-up period for shareholders to avoid speculation and
introducing a market-maker system to enhance the quality of information
disclosure.

(Source: China Daily)