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Regulations on the transfer information releas

  Article 1 The regulations are prepared in accordance with the Rules for State-owned Equity Transactions of Enterprises to regulate the public release of enterprise state-owned equity transfer information release.

  

  Article 2 The regulations shall be applicable to the public release of enterprise state-owned equity transfer information in the equity transaction market.

  

  Article 3 Transfer information of enterprise state-owned equity transfer shall be published on the website of the equity transaction institution and in the designated economic or financial newspapers and journals released above the provincial level.

  Central enterprise equity transfer information shall be released by relevant equity transaction institution in their jointly selected newspapers and journals, as well as their websites, and in economic or financial newspapers and journals with large coverage in the place of registration of the target enterprise or the place where the major assets of the target enterprise are located.

  The equity transaction institution may also adopt other supplementary means such as displays in the transaction hall, promotional literatures, or project recommendation, with a view to extensively solicit intended transferees.

  

  Article 4 The transferor shall specify the time limit for the equity transfer information release. The time limit for the initial information release shall not be less than 20 working days, and the starting day shall be the initial information announcement day on the newspapers and journals above the provincial level.

  

  Article 5 The contents of enterprise state-owned equity transfer information published by the equity transaction institution in the newspapers and journals are mainly the basic information of the equity transfer target, and the institution shall release the websites of the information and ways of inquiry through the website of the said institution.

  The contents of enterprise state-owned equity transfer information published by the equity transaction institution on its website shall be those of the equity transfer announcement, including the basic information of the transfer target, transaction conditions, transferee eligibility, relevant information having significant impact on equity transactions, selection of auction ways, and transaction deposit setting, and shall note the names of the newspapers and journals for initial publishing, and the beginning and ending dates for the soliciting intended transferees.

  

  Article 6 Information release period shall be measured on working day basis; in case of statutory public holidays, actual working days announced by relevant government department shall prevail. The date published on the website of the equity transaction institution shall not be later than that announced in the newspapers and journals.

  

  Article 7 During the announcement period, the transferor shall accept the inquiry of the intended transferees; intended transferees may, through broker members, inquiry into relevant materials of equity transfer information in the equity transfer institution.

  

  Article 8 Where there are no eligible intended transferees solicited within the prescribed announcement period, and no information release contents are changed, the transferor may, in accordance with the stipulations in the equity transfer announcement, extend the information release period, and each extension shall be no less than 5 working days.

  

  Article 9 Where there are no eligible intended transferees solicited within the prescribed announcement period, and the transferor fails to specify the extension of the information release period in the equity transfer announcement, information announcement shall terminate automatically upon expiration.

  

  Article 10 During the information release period, the transferor shall not change the contents of the equity transfer announcement. In case of need to change such contents due to special reasons, equity transfer approval institution shall issue relevant document and make an announcement in the original information release channels, and re-measure the announcement period.

  

  Article 11 For the transfer of enterprise state-owned equity, the listed price at the time of the initial information release shall not be lower than that in the filed or approved transfer target asset appraisal result. In case that there are no intended transferees solicited within the prescribed announcement period, the transferor may, within the range of no less than 90% of the appraisal result, set new listed price before announcement. If the new listed price is lower than 90% of the appraisal result, the transferor shall obtain approval from equity transfer approval institution before publishing equity transfer announcement.

  

  Article 12 During the information announcement period, in case of any circumstance that affects the normal transactions, or after relevant party proposes written application and related materials for suspension of information announcement, the equity transaction institution may, within five working days, make the decision on the suspension of information release.

  

  Article 13 The time limit of the suspension shall be determined by the equity transaction institution in accordance with actual situations, and shall not be more than 30 days in general. The equity transaction institution shall, during the suspension period of information release, make a survey and verification of the application or disputed matters, and may also submit to relevant departments for investigation and verification, and make prompt decision on restoration or termination of the decision on information release. For restoration of information release, the cumulated announcement period on the website of the equity transaction institution shall not be less than 20 working days, and the renewed announcement period shall not be less than 10 working days.

  

  Article 14 In case of circumstances causing the transactions to fail to operate normally during the information release period, and the case cannot to be terminated upon investigation and verification, the equity transaction institution may, within five working days starting from the following day of receipt of the written application and relevant evidences submitted by the party concerned for termination of the information release, make a decision on whether to terminate the information release, and may also depend on actual situations to directly make the decision on terminating the information release.

  

  Article 15 The release of suspension and termination of equity transfer information shall be announced on the website of the equity transaction institution.

  

  Article 16 The regulations come into force as of the date of promulgation.

  

  Regulations on registration of intended transferees

  Article 1 The regulations are prepared in accordance with the Rules for State-owned Equity Transactions of Enterprises to regulate the registration and eligibility confirmation of the intended transferees after the release of enterprise state-owned equity transfer information.

  

  Article 2 The equity transaction institution adopts principal-agent system. The intended transferees may independently choose broker members from the list of members published by the equity transaction institution on its website, sign principal-agent contract, and establish principal-agent relationship.

  

  Article 3 During the period of the equity transfer information release, the intended transferees shall entrust broker members to inquiry into relevant information and materials of the transfer target in the equity transaction institution.

  

  Article 4 The intended transferees shall entrust broker members to complete the Application for accepting equity transfer, mainly covering such contents as the basic information of the transferees, target, base price, relevant commitments, and the opinions of entrusted broker members.

  

  Article 5 The intended transferees shall, within the information announcement period, entrust broker members to submit to the equity transaction institution the application for accepting equity transfer, as well as related appendixes, acknowledge all the contents and transaction conditions set forth in the equity transfer announcement, and make commitment to observe market rules. The equity transaction institution shall register the applications of the intended transferees one by one.

  

  Article 6 The intended transferees shall be responsible for the authenticity, integrity, and validity, and compliance of the contents of the Application for accepting equity transfer and relevant materials.

  The entrusted broker members shall review the authenticity, integrity, and validity, and compliance of the materials submitted by the intended transferees, and issue opinions on verification.

  

  Article 7 Equity transaction institution shall, within two working days starting from the following day of the receipt of the application materials for accepting the transfer, review the completeness and compliance of the applications and appendixes.

  

  Article 8 Where the registered intended transferees fail to meet the transferee eligibility conditions set forth on the equity transfer announcement, or propose acceptance requirements with additional conditions, or where the materials submitted fail to meet the requirements for completeness and compliance, the equity transaction institution shall give written notice to the intended transferees through broker members, and the intended transferees shall make adjustment within two working days starting from the following day of receipt of the notice.

  

  Article 9 Equity transaction institution shall, in accordance with the transferee eligibility conditions set forth in the equity transfer announcement, review the qualifications of the intended transferees, with major contents as follows:

  (A) Whether the intended transferees make commitment to the authenticity, integrity, validity, and compliance with market rules;

  (B) Whether broker members verify materials, and whether verification opinions are specific;

  (C) Whether the right as principals of the intended transferees conforms to the transferee qualifications set forth in the equity transfer announcement and relevant requirements in the remarks and explanations.

  (D) Whether the transferee as legal entities has fulfilled necessary internal decision-making process or approval procedures pursuant to law;

  (E) Whether the credit certifications submitted by the transferee accord with the equity transfer announcement;

  (F) If the management and its related parties involve in accepting the transfer, whether they make relevant commitments and provide the certification to show the compliance of the funding for acquisition; if the legal representatives of the transfer target and the equity holder, whether they provide audit report on the economic responsibilities of legal representative.

  The transferee eligibility conditions that are not released in information announcement may not be used as the basis to confirm the intended transferee’s eligibility.

  

  Article 10 In case of the following circumstance of the management, state-owned equity of the target enterprise shall not be accepted:

  (A) Audit shows direct liability for the business performance decline;

  B) Intentionally transfer and conceal assets or affect the net assets of the target enterprise through related transactions in the process of the equity transfer;

  (C) Provide false information to intermediaries, thereby causing the distortion of the audit and appraisal results, or collude with relevant parties to drive down asset appraisal results and state-owned equity transfer price;

  (D) Failure to comply with relevant regulations, participate in the development of state-owned equity transfer plans and the determination of related asset and capital verification, financial audit, asset appraisal, base price, intermediaries, and other important matters.

  (E) Inability to provide certification of the compliance of the funding for accepting the transfer.

  

  Article 11 The equity transaction institution shall, within five working days after the expiration of the information release period, issue to the transferor the transferee eligibility confirmation opinions through broker members, giving written notice on the confirmation opinions on the eligibility of the registered intended transferees.

  

  Article 12 The transferor shall give written reply within five working days after receipt of the transferee eligibility confirmation opinions from the equity transaction institution. Where the transferor renders that the intended transferees fail to meet the transferee eligibility conditions, the transferor shall, after verification of the entrusted broker member, issue written opinions, illustrate reasons and submit relevant supporting documents. In case of no reply beyond time limit, the transferor shall be deemed to agree with the confirmation opinions of the equity transaction institution.

  

  Article 13 In case of disagreement with the intended transferee edibility confirmed by the equity transaction institution, the transferor shall negotiate with the equity transaction institution, and if necessary, may solicit state-owned assets supervision and administration institution for opinions on relevant controversial issues.

  

  Article 14 Upon solicitation of the opinions of the transferor, the equity transaction institution shall, through a broker members, issue the transferee eligibility confirmation notice to the transferee, and copy to the transferor. The said notice shall specify the amount and deadline of the transaction deposit to be paid by the intended transferees. The deadline shall be within three working days starting from the following day on which the equity transaction institution issues the said notice.

  

  Article 15 The intended transferees in compliance with eligibility confirmation shall, within the predetermined time limit, pay transaction deposit (reaching the account designated by the equity transaction institution) to the equity transaction institution, and then get eligibility confirmation after paying transaction deposit in accordance with regulations. Overdue payment of transaction deposit shall deem to waive the transferee eligibility.

  

  Article 16 If the intended transferees failing to get eligibility confirmation disagree with the confirmation, and after entrusted brokers verify the case, they may, within two working days starting from the following day of receipt of the transferee eligibility confirmation notice, propose the application for reexamination of the transferee eligibility, and the application shall illustrate the reasons for disagreement and relevant supporting materials shall be submitted. The equity transaction institution shall, within five working days starting from the following day of receipt of the application for re-examination, complete re-examination and issue re-examination opinions on the eligibility confirmation.

  

  Article 17 Where the intended transferees who have obtained eligibility confirmation requires the transferor to explain or illustrate relevant contents of the equity transfer announcement, they shall give written application to the equity transaction institution through a broker member, and the said institution shall give notice to the transferor after review. The transferor shall reply within five working days starting from the following day of receipt of the notice of the said institution. In case of overdue reply from the transferor, the equity transaction institution may suspend the transactions, and corresponding liabilities shall be borne by the transferor.

  

  Article 18 The regulations come into force as of the date of promulgation.

  

  Regulations on organizing the signing of contracts for transactions

  Article 1 The regulations are prepared in accordance with the Rules for State-owned Equity Transactions of Enterprises to regulate the organization of equity transfer through outcry and the signing of contracts for transactions, and other behaviors.

  

  Article 2 Where there are two or more eligible intended transferees upon expiration of equity transfer information announcement period, the equity transaction institution shall organize the implementation of open outcry in accordance with outcry method mentioned in the announcement;

  

  Article 3 Where there is only an eligible intended transferee upon the expiration of equity transfer information announcement period, the equity transaction institution shall organize the intended transferee to quote, and the quotation shall not be lower than the listed price.

  

  Article 4 Where other shareholders of the target enterprise involved in the case enjoy pre-emption right at the same condition, the transaction institution shall provide relevant services and system guarantees for them to exercise rights in the exchange.

  

  Article 5 Open outcry methods include online outcry, auction, bidding, and other ways of outcry.

  

  Article 6 For online outcry, multiple quotation, one-time quotation, weighted quotation, and other methods may be adopted. The equity transaction institution shall organize the implementation in accordance with the Measures for the Implementation of Enterprise State-owned Equity Transfer through Online Outcry.

  

  Article 7 For auction, the equity transaction institution shall organize the implementation in accordance with the Measures for the Implementation of Enterprise State-owned Equity Transfer through Auction.

  

  Article 8 For bidding, the equity transaction institution shall organize the implementation in accordance with the Measures for the Implementation of Enterprise State-owned Equity Transfer through tendering and bidding.

  

  Article 9 The equity transaction institution shall, within three working days after the transferee is determined, organize both parties to the transaction to sign an equity transaction contract.

  

  Article10 An equity transaction contract includes but not limited to:

  (A) Name and domicile of both parties;

  (B) Basic situation of the target enterprise;

  (C) Way of equity transfer;

  (D) Whether there are matters concerning the employment of the employees of the target enterprise, and how to deal with the matters if any;

  (E) Target enterprise’s creditor’s rights and debt disposal;

  (F)Transfer price, payment method and payment deadline;

  (G) Equity settlement matters;

  (H) Conditions for the effectiveness of the contract;

  (I) Contract dispute resolution methods;

  (J) Liabilities for breach of contract;

  (K) Conditions for contract changes and cancellation.

  

  Article 11 The equity transaction institution shall, based on the relevant provisions of the laws and regulations, review equity transaction contracts according to the contents of equity transfer announcement and the results of outcry transactions.

  

  Article 12 Where the equity transactions involve inspection of right as principal, anti-monopoly review, and other cases, and where the effectiveness of the equity transaction contracts shall be approved by relevant government department, both parties to the transaction shall submit to the said department the contracts and relevant materials, and the equity transaction institution shall issue transaction evidence documents required for examination and approval by relevant government department.

  

  Article 13 The regulations come into force as of the date of promulgation.

  

  Regulations on the settlement of transaction funds

  Article 1 The regulations are prepared in accordance with the Rules for State-owned Equity Transactions of Enterprises to regulate the settlement of transaction funds of enterprise state-owned equity transfer.

  

  Article 2 Equity transaction funds mentioned herein include transaction deposit and equity transaction price.

  Transaction deposit is the monetary capital paid by the intended transferees to the equity transaction institution in accordance with the equity transfer announcement for ensuring the intended transferees to observe transaction rules and fulfill their commitments.

  Equity transaction price is the monetary capital paid by the intended transferees to the equity transaction institution in accordance with the equity transaction contract for purchasing the transfer target through the equity transfer institution.

  

  Article 3 Equity transaction institution shall adopt unified on-floor settlement system, set independent settlement accounts, organize collection and payment of transactions funds, and ensure the safety of transaction funds in the settlement funds accounts, and the funds shall not be used for other purposes.

  Where both parties to the transaction are the same actual controller, and after the case is verified by the equity transaction institution, over-the-counter settlement shall be adopted for transaction funds.

  

  Article 4 After the equity transaction contract is signed between the transferor and the transferee, the transaction deposit paid by the latter may be changed into the transaction price in accordance with the stipulations. The equity transaction institution shall transfer the deposit from the dedicated account of deposit to the settlement account of equity transaction price.

  The transaction deposits paid by other intended transferees shall be refunded in full by the equity transaction institution within three working days.

  

  Article 5 Where lump-sum payment is set forth in the equity transaction contract, the equity transaction price settlement amount is the turnover; for installments, the equity transaction price settlement amount shall not be lower than down payment.

  

  Article 6 For installments stipulated in the equity transaction contract, besides down payment of transaction price, both parties may agree on the settlement method for the rest payment.

  

  Article 7 RMB shall be generally adopted for the settlement of transaction funds; for settlement in foreign currencies, both parties shall submit application to the equity transaction institution in advance, and shall use the foreign currencies designated by the foreign exchange administration. For settlement of the equity transaction price in foreign currencies, both parties shall, in accordance with relevant regulations of the foreign exchange administration, fulfill settlement procedures.

  

  Article 8 For settlement of the equity transaction price in RMB, the following procedures shall be followed:

  (A) After both parties sign equity transaction contract, the transferee shall, within the prescribed time limit set forth in the equity transaction contract, pay the equity transaction price to the settlement account of the equity transaction institution. Then the equity transaction institution shall issue receipt, and give notice to the transferor.

  (B) Upon completion of the procedures for ownership change, the transferor shall, along with the broker members, take evidence of ownership change, identification certificates of responsible person, and receipt to the equity transaction institution to fulfill procedures for transfer of transaction price. Unless otherwise stipulated by both parties on transaction price transfer, the stipulation may be followed after the case is reviewed by the said institution.

  (C) For compliance of the conditions for equity transaction price transfer, the equity transaction institution shall finish the transfer of the transaction price within three working days starting from the following day on which the transferor requires fulfilling the procedures for the transfer of the transaction price.

  (D) Both parties shall, in accordance with the charging standards of the equity transaction market, pay transaction service charges, and after receiving service charges, the transaction institution shall issue receipt.

  

  Article 9 The equity transaction funds shall not be collected or paid by any third party other than the equity transaction institution.

  

  Article 10 The equity transaction institution shall settle the interest of the equity transaction price in accordance with the benchmark demand deposit interest rate of the People’s Bank of China.

  From the following day after signing the equity transaction contract to the day on which the contract becomes effective, the interest of the equity transfer price shall be owned by the transferee; from the following day after the equity transaction contract becomes effective to the day on which the transaction price is transferred from the equity transaction institution, the interest of the equity transfer price shall be owned by the transferor.

  

  Article 11 Charging standards for equity transactions shall be consistent with relevant regulations of local government price authority in the place where the equity transaction institution is located, and shall be published on the workplaces and information platform of the said institution.

  The equity transaction institution shall not deduct transaction service charges from the transaction price without permission.

  

  Article 12 The regulations come into force as of the date of promulgation.