On 18 January 2019, The Stock Exchange of Hong Kong Limited (SEHK) published its consultation conclusions on proposed changes to the review structure for Listing Committee decisions, which largely adopts the proposals in the consultation paper with modification to the size of the new Listing Review Committee. The amended Main Board (“MB“) Listing Rules and GEM Listing Rules (collectively the “New Rules“) will become effective around mid-2019 (“Effective Date“), subject to the establishment of the new Listing Review Committee.
What will be changed?
1. The Listing Appeals Committee (“LAC“) will be discontinued without being replaced.
2. The current review structure will be revised so that “decisions of material significance” made by the Listing Committee will be subject to only one level of review. Decisions of material significance refer to:
- rejection of a new applicant’s listing application solely on the ground of unsuitability for listing;
- cancellation of listing; and
- imposition of certain disciplinary sanctions.
3. The existing Listing (Review) Committee (“LRC“) and the Listing (Disciplinary Review) Committee (“LD(R)C“) will be replaced by an independent review committee (to be named the “Listing Review Committee“), which will serve as the final review body.
4. The Securities and Futures Commission (SFC) may request a review of any disciplinary decision, including a decision of the Listing Committee by the new Listing Review Committee (MB Rule 2A.16A).
5. The key features of the Listing Review Committee are:
|(c) Conduct of meetings||
|(d) Chairperson pool||
|(e) Terms of appointment||
|(f) Powers and functions||
|(g) Publication of non-disciplinary decisions||
|(h) Transitional arrangement for non-disciplinary review hearings||
|(i) Transitional arrangement for disciplinary review hearings||
6. During the transitional period, the LAC, the LRC and the (LD(R)C) will continue to operate, concurrently with the new Listing Review Committee, for a certain period.
In the first half of 2019, SEHK will conduct a separate consultation on (i) its disciplinary powers and sanctions; and (ii) the procedural issues for disciplinary hearings and non-disciplinary review hearings. The implementation of the new review structure will not be affected by such consultation.