Investors can have more accessibility to the information of IPO-seeking companies starting from July, as the China Securities Regulatory Commission (CSRC) is to release a preliminary prospectus online within five working days after an IPO-seeking company receives feedback from the CSRC.

According to the CSRC, the new rule aims at “strengthening the supervision over IPOs, enhancing underwriters’ awareness of responsibility, and improving the quality of listed companies.”

Grandall Legal Group partner Wang Weidong said that the new notice will certainly broaden the ability of potential investors, both local and foreign, and allow them to be familiar with the IPO-seeking companies.

“Public investors can find out more about the IPO-seeking companies even before the CSRC’s examination. This will enable the CSRC to receive more comments and opinions from the market as well as undisclosed information,” he said.

High market demands and rapid developments have prompted the government to develop relevant rules to speed up the procedures as well as to serve the public’s interests. The new rule not only increases the transparency of government procedures but also clarifies the time requirement and shortens the time margin in practice by giving out the time frame of when a preliminary prospectus would be published, Wang said.

Before the new rule came into effect, the public could not learn when the IPO prospectus would be published after revision, except that a disclosure must be publicized five days before a CSRC meeting for formal approval. The downside is that there may be long stretches of time between revisions and republication, and the public has no chance to find out what crucial changes have the companies made during that time.

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