The Securities and Futures Commission (SFC) has released a report on its review of the performance of The Stock Exchange of Hong Kong Limited (SEHK) in its regulation of listing matters during 2021 (Note 1).
During the review, the SFC assessed the Listing Division’s operations, processes and procedures in general and conducted a more in-depth review of SEHK’s performance in reviewing business valuations included in the circulars for major or larger acquisitions and disposals, administering the Placing Guidelines for initial public offerings (IPO) and reviewing the IPO placee lists (Note 2).
In the report, the SFC made a number of recommendations to SEHK. These included a review of SEHK’s internal guidance to enhance the placee vetting process and improvement of the disclosure practices relating to business valuations for major or larger acquisitions and disposals.
The report, which summarises the SFC’s findings and recommendations, has been published on the SFC website.
- The SFC has a statutory duty under the Securities and Futures Ordinance to supervise, monitor and regulate the activities carried on by SEHK. To discharge this function, the SFC conducts periodic reviews of SEHK in its regulation of listing-related matters.
- The review also covered SEHK’s processes and procedures in respect of the Listing Operation Governance Committee, the Listing Compliance function and the management of conflicts of interest on the part of Listing Committee members and Listing Division staff in handling cases.