Amendments to the GEM Listing Rules - Public Float Requirements and Accounting Standards (Update 2 - November 17, 1999)
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Note to
subscribers for the amendments to
the rules governing the listing of securities on the Growth Enterprise Market
("GEM Listing Rules")
Update No. 2
17 November 1999
Dear Sirs,
Amendments to the GEM Listing Rules -
Public Float Requirements and Accounting Standards
The GEM Listing Rules have been amended as
follows:
| 1. |
Rule 11.23 currently provides that a minimum
of 20% to 25% of share capital is to be held by the public subject to a minimum of HK$30
million being held by the public. To maintain an open market in securities whilst having
regard to issuers' commercial interests, revised minimum public float limits have been
established as follows: |
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(a) |
For companies with a market capitalisation of below HK$1
billion at the time of listing, a minimum public float of 20% subject to a minimum of
HK$30 million. |
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(b) |
For companies with a market capitalisation of HK$1 billion
or more at the time of listing, a minimum public float of 15% or such higher percentage as
will result in at least HK$200 million worth of shares being in the hands of the public at
the time of listing. |
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| 2. |
At present, the financial statements of
overseas-incorporated issuers must comply with accounting standards applicable to Hong
Kong incorporated companies or comply with International Accounting Standards issued by
the International Accounting Standards Committee. Additional flexibility consistent with
maintaining a requirement for applicants to comply with a comprehensive body of accounting
standards has now been introduced for overseas-incorporated issuers as follows: |
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(a) |
Overseas-incorporated applicants, which are listed on
either the New York Stock Exchange ("NYSE") or the NASDAQ National Market
("Nasdaq"), may prepare their financial statements in accordance with Generally
Accepted Accounting Principles in the United States of America ("US GAAP"). |
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(b) |
Overseas-incorporated applicants, which will be
simultaneously listed on either the NYSE or Nasdaq, may prepare their financial statements
in accordance with US GAAP. |
Provisions in Chapters 7, 11, 16, 18, 25 and Parts A and B of Appendix
1 of the GEM Listing Rules have been amended to give effect to the above changes. These
rule changes come into immediate effect. Re-printed pages of the GEM Listing Rules
together with filing instructions are enclosed.
Yours faithfully,
For and on behalf of
The Stock Exchange of Hong Kong Limited
Lawrence Fok
Senior Executive Director
Regulatory Affairs Group
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The amendments to the relevant
section of the GEM Listings Rules have been marked-up for your reference, please click here to see the amendments to the respective
chapters. |