39 ASIAN LEGAL BUSINESS CHINA • 亚洲法律杂志-中国版 WWW.LEGALBUSINESSONLINE.COM/CHINA strengthening various compliance inspections and assisting those enterprises to actively prepare for listing applications. Second, as regards projects facing difficulty in listing application, our team assists the affected companies in handling the repurchase requests from existing investors; for clients with the intention to sell, we actively look for potential buyers and offer equity sales services.” Where clients still wish to raise funds amid the current capital market climate, “we work with clients to link them up with providers of ‘patient capital’ who have a long-term investment horizon, such as government-guided funds, listed companies in the same industry and other industrial investors. For clients who may face challenges to list on the A-share market, we assist them to seek listing on Hong Kong or U.S. stock market to broaden financing channels,” says Tan. According to Qi, the capital markets team of China Commercial Law Firm is “also actively adjusting service offerings. We would also guide enterprises to adjust expectations, and to embrace the global capital market.” One way is to help companies broaden financing channels, especially by “leveraging overseas capital markets.” Qi shares that the firm has recently assisted a client in issuing offshore RMB bonds worth more than 670 million yuan for listing on Chongwa (Macao) Financial Asset Exchange. “Our Mainland and Hong Kong teams worked together on this project which is already the second bond financing project of the same type that the firm has worked on so far this year.” In addition, the firm’s capital market and securities committee has recently taken the lead in setting up a SPAC listing office “which will serve the diversified capital market needs of domestic enterprises... Our coverage of overseas capital markets is not limited to Hong Kong and U.S. stocks, but also includes emerging capital markets such as India, Vietnam, etc.” Speaking of expectations for the A-share market in the second half of the year, Tan points out: “At present, the CSRC is making countercyclical adjustments to new share issuance while comprehensively considering tolerance on the secondary market. Both the CSRC and stock exchanges have rolled out a slew of reform documents to support the Nine Articles and the Sixteen Measures, adjusted the application criteria for listing on relevant boards, and strengthened regulation over matter such as dividend distribution by listed companies and reduction of holdings by major shareholders, which has laid foundation for the development of the capital market in the next stage.” “If the secondary market enjoys stable performance in the second half of 2024, then there will be a market basis for ending countercyclical adjustments, which may potentially serve to restore the original rhythm of IPOs to a certain extent,” predicts Tan. HONG KONG PIPELINE DOUBLES Tightening regulation at home may have hindered the A-share listing by some companies, but it has brought more activity to the Hong Kong capital markets. Nan Li is a member of the management committee of Tian Yuan Law Firm as well as managing partner of its Hong Kong office. According to him, recent changes in Hong Kong’s capital markets began on Aug. 27 last year when the CSRC issued the document titled Coordinating Arrangements for Balancing the Primary and Secondary Markets, Optimizing IPO and Regulating Refinancing, which puts forward the requirements of “tightening the pace of IPO and refinancing in a phased manner.” “Beginning in the third and fourth quarters of last year, a number of listing projects originally destined for the A-share market have successively moved to Hong Kong. Further tightening policies since the start of this year have prompted more companies with a wait-and-see attitude to make up their minds and switch to Hong Kong.” “Compared to the same period of last year, the number of Hong Kong listing projects that are underway or are in the pipeline has increased significantly, CAPITAL MARKETS “If the secondary market enjoys stable performance in the second half of 2024, then there will be a market basis for ending countercyclical adjustments.” — Tan Qing, Tian Yuan Law Firm “2024年下半年若二级市场表现平稳，则具备结束逆周期调节的市场基础。” — 谭清，天元律师事务所
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