• CHI CSRC issued Interpretation no. 19 to clarify, standardize the application of articles 13 and 14 of the Measures for the administration on acquisition / takeover of listed companies.

Interpretation Details

• Thresholds of 5%, 1% in articles 13, 14 apply only to integer multiples of these values.
• Passive changes in substantial shareholding due to corporate actions are exempt from disclosure, lock-up obligations, and listed companies are responsible for announcing such changes.
• The new rules apply prospectively, but past violations that are discovered post-implementation will be handled under the principle of applying old rules with leniency.
• The interpretation reduces compliance costs by simplifying equity monitoring for investors and enhances market transparency by standardizing disclosure thresholds.
• Feedback from consultation supported Interpretation; suggestions were incorporated.

Effectiveness

• The interpretation is effective from 10 January 2025.