Article/Chen Peixiong, columnist of Sina Financial Opinion Leader (WeChat public account kopleader)
The registration system reform, which has been silent for a period of time, has attracted people's attention again due to the news that Shanghai Stock Exchange is going to set up a science and technology innovation board. The author has published many analytical articles on the reform of the registration system, and there is a special chapter in the book "The Logic of the Stock Market" on what is the registration system.
1、 Review of China's registration system reform
In chronological order, we briefly review the process of the reform of China's stock issuance registration system.
On November 15, 2013, the Third Plenary Session of the 18th National Congress of the Communist Party of China adopted the Decision of the Central Committee of the Communist Party of China on Several Major Issues Concerning Comprehensively Deepening Reform, which proposed for the first time to promote the reform of the stock issuance registration system. The Decision proposed: "Improve the multi-level capital market system, promote the reform of the stock issuance registration system, promote equity financing through multiple channels, develop and standardize the bond market, and increase the proportion of direct financing."
On November 30, 2013, the CSRC issued the Opinions on Further Promoting the Reform of the IPO System. Opinions Propose: "To implement the requirements of the Third Plenary Session of the 18th CPC Central Committee on promoting the reform of the share issuance registration system, we must further promote the reform of the new share issuance system, clarify and straighten out the relationship between the government and the market in the process of new share issuance, speed up the regulatory transformation, improve the quality of information disclosure, strengthen market constraints, promote all market participants to return to their duties, and implement the share issuance registration The system lays a good foundation. "
On March 5, 2014, in the government work report of the National People's Congress, it was clearly stated: "Promote the reform of the stock issuance registration system."
On April 10, 2014, Xiao Gang, the former chairman of the China Securities Regulatory Commission, said at the Boao Forum for Asia that the draft reform of the IPO registration system was introduced at the end of the year.
On May 9, 2014, the State Council issued Several Opinions on Further Promoting the Healthy Development of the Capital Market (referred to as the New National Ninth Article for short). The ninth article of the new country proposes: "actively and steadily promote the reform of the stock issuance registration system."
On November 19, 2014, the executive meeting of the State Council stressed that the reform plan of the stock issuance registration system should be introduced as soon as possible.
On January 16, 2015, Xiao Gang, the former chairman of the CSRC, said that promoting the reform of the stock issuance registration system was the top priority of the capital market reform in 2015.
On February 13, 2015, Deng Ge, spokesman of the CSRC, said that the first draft of the registration system reform plan had been completed and submitted to the State Council.
On March 2, 2015, Gui Minjie, the former chairman of the Shanghai Stock Exchange, said that the registration system was expected to be implemented this year.
On March 5, 2015, Premier Li Keqiang said in the government work report that the reform of the stock issuance registration system was implemented.
On December 9, 2015, the executive meeting of the State Council adopted a draft that the Standing Committee of the National People's Congress authorizes the State Council to adjust the relevant provisions on trial in the implementation of the reform of the stock issuance registration system. At the same time, the CSRC said that it would actively and steadily promote the reform of the registration system.
On December 27, 2015, the 18th meeting of the Standing Committee of the 12th National People's Congress voted in Beijing on December 27 to authorize the State Council to adjust the application of the relevant provisions of the Securities Law of the People's Republic of China in the implementation of the reform of the stock issuance registration system. It is known that the implementation period of the decision is two years, and the decision will come into force on March 1, 2016.
Then on February 20, 2016, Xiao Gang was removed from his post. The government work report after 2016 no longer mentioned the reform of the registration system. The two-year authorization period of the Standing Committee of the National People's Congress has expired. The vigorous reform of the registration system in China has been postponed indefinitely. Now it can be regarded as a restart.
2、 Must Understand the Registration System to Realize Reform
A vigorous reform of the registration system came to an abrupt end. Now, once again, the question that needs to be asked is, have we understood the registration system? Here, several key points for understanding the registration system are proposed as follows:
(1) Must distinguish between the issuance registration system and the listing registration system
The company's financing through issuing shares is a kind of financing method of the company under the market economy, which is called direct financing. For a long time, China's companies need strict approval for issuing stock financing. Whether it is the approval system or the approval system, until today, China's companies need to be approved for public issuance of shares, which belongs to the non registration system. Indirect financing through commercial banks does not require approval, nor even the concept of registration system. Even if China adopts the registration system for direct financing, the conditions for direct financing are actually stricter than those for indirect financing.
Then talk about the listing registration system. In the case of multiple exchanges, the approval of the exchange is generally required for the listing and trading of shares of a joint-stock company on which the exchange is listed, and the approval system or registration system can be adopted. Under the concept that all joint-stock companies are allowed to list, exchanges generally only adopt the registration system rather than the approval system. For a long time, there has been a wrong concept in China, that is, direct financing is confused with listing, only listing can finance, and financing must be listed. Therefore, there is no separate listing approval or registration system, which is operated in accordance with the stock issuance approval or registration system.
Without distinguishing the difference between issuance and listing, we will never understand the approval system and registration system.
3、 Correctly understand listing
Why should the company go public? The concept of listing originates from the emergence of shareholding system. The emergence of shareholding system is a great invention of human economic society. The direct reason for the emergence of shareholding system is "the contradiction between the limited number of single capital and the continuous increase of the minimum capital required for effective production". Therefore, Marx said that if there were no joint-stock system, there would be no train. Since joint-stock companies cannot withdraw their shares after raising funds, they can only withdraw their shares in disguised form through listing in the stock market. In this sense, the stock market is a supporting mechanism for the shareholding system. Without the stock market, there would be no shareholding system.
The second concept that needs to be understood is that under the market economy, it must be recognized that no one can make correct value judgments, that is, no one can price goods, but only the market price. This is true for simple ordinary commodities, especially for complex companies (stocks). When people understand the market economy, they will understand that only the market can set the price of listed stocks, not the so-called experts. In this case, the managers of the stock market will not price the company's shares. Therefore, in fact, there is no need for stock market managers to judge and approve the value of listed companies. There are many foreign stock markets. The purpose of classification is to facilitate investors and reduce transaction costs. Just like the classification of books in the library, the library will not judge the value of books.
4、 Correctly understand stock issuance
Like the indirect financing of loans to commercial banks, companies issue shares for financing, which is different from the indirect financing of commercial banks and is called direct financing. In fact, direct financing does not need to go through a third-party intermediary. It is almost impossible for companies to get financing without going through a third-party intermediary. In this case, the so-called direct financing is still conducted through a third-party financial institution, but the name of the financial institution is changed to investment bank instead of commercial bank. Realize the company's stock (or bond) issuance and financing under the role of investment banks. Note that under the mixed system (today's United States), commercial banks and investment banks can be integrated, but we distinguish them when undertaking different businesses of indirect financing and direct financing.
Both commercial banks and investment banks will be punished by the market and lead to bankruptcy of commercial banks or investment banks in case of business failure, such as failure to collect loans and helping companies issue "wrong" stocks (mainly due to unreasonable pricing or other fraud).
5、 Enlightenment to us
(1) It must be clarified theoretically that stock issuance and company listing
For a long time, China has not been clear about the difference between stock issuance and company listing. Zhou Xiaochuan once published a long article saying that foreign companies can not be listed for financing and can not be listed for financing. In fact, he has expressed the view that financing and listing are not the same thing. The joint-stock system and the stock market are introduced from abroad. We can innovate, but we cannot distort them.
(2) Only investment banks can have the stock issuance registration system
If there is no commercial bank in an economic society, no enterprise can obtain funds through loans, that is, there is no indirect financing. Similarly, if there is no investment bank in an economic society, no company can obtain funds through the issuance of shares by investment banks. It is noted that commercial banks can be established overnight, but investment banks need at least ten years to hone. Famous foreign investment banks have a history of more than 100 years. The term "more than ten years" here means that the state allows investment banks to exist and starts to try to engage in investment banking business. Therefore, up to now, there is no investment bank in China, only a securities firm, a fake investment bank with the title of investment bank.
Therefore, China's registration system must be opened from now on to allow securities companies to engage in investment banking business. Maybe a few securities companies can become investment banks in ten years, while most will be eliminated by the market. Maybe we can shorten the transformation process by other means, but we can't change the rule that investment banks can only produce in the market test.
(3) To develop shareholding system, all shareholding companies must be listed
Joint stock companies and the stock market are all supporting mechanisms of the joint-stock system. In fact, there is no joint-stock company when there is a joint-stock company but there is no way for the joint-stock company to be listed. One of the main reasons for the slow development of joint-stock companies in China is that joint-stock companies cannot be listed and traded, so investors will not invest in joint-stock companies because there is no exit channel.
Let all joint-stock companies deal in one market to solve the withdrawal problem of joint-stock companies. This measure will not affect the direct financing market and will not cause risks. It can be a preliminary support for the full implementation of the stock issuance registration system. This practice can be implemented in the short term.
(The author of this article is a researcher of Guangdong Industrial Development Research Institute)
