What is the Shanghai International Board?

Updated: 2010-08-04 11:23
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The Shanghai Stock Exchange (SSE) plans to launch an international board that would allow offshore companies to sell shares denominated in Chinese currency.

The international board will also explore the possibility for overseas companies and red chip firms to issue yuan-denominated bonds and other debt instruments. Red chip firms are firms based in the Chinese mainland that is incorporated internationally and listed on the Hong Kong Stock Exchange.

The China Securities Regulatory Commission, China's top securities regulator, and the Shanghai stock exchange are taking the lead in drafting related rules and regulations.

Not including red-chip companies, such as China Mobile and PC maker Lenovo, more than 23 international companies have signaled that they would be interested in issuing shares in the Chinese mainland. They include General Electric, Coca-Cola, Wal-Mart, DBS Bank and Volkswagen AG, HSBC Holdings Plc and Nasdaq operator Nasdaq QMX Group Inc.

The launch of the international board is also part of effort to re-regulate the country's capital markets and broaden investment channels for domestic investors. However, there is no specific schedule yet for the launch of the long-planned board because of legal and technical issues, such as accounting standards, investor protection laws, and disclosure systems.