In October 17 2008, the China Securities Regulatory Commission (CSRC) promulgated a regulation on the rights of listed company shareholders to issue exchangeable bonds, namely the Trial Provisions for the Issuance of Convertible Bonds by Shareholders of Listed Companies (上市公司股东发行可交换公司债券试行规定) (Trial Provisions).
Can Exchangeable Bonds Satisfy Cash-Hungry Shareholders?
The Trial Provisions for the Issuance of Convertible Bonds by Shareholders of Listed Companies promulgated by the China Securities Regulatory Commission opens a new debt financing channel for cash-hungry shareholders in China's financial market. These Provisions are designed to stabilise the country's stock market and ease oversupply of stocks in the A-share market, as panic sets in about possible dumping of newly freed locked-up shares under the Share Segmentation Reform launched in 2005. By Jiang Jiang, Hylands Law Firm partner
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