China has secured its grip on proposed offshore listings with new rules that bankers and lawyers say will favour Hong Kong and domestic Chinese markets over Wall Street.
The rules, which go into effect at the end of March, come nearly two years after Beijing slammed the brakes on lucrative initial public offerings in Hong Kong, New York and other offshore jurisdictions as part of a sweeping regulatory crackdown.
“We might see some recovery in US IPOs from Chinese companies, but it’s hard to envision flows returning to their prime,” said Zhan Kai, a Shanghai-based senior counsel at Chinese law firm Yuanda. “The US capital market is irreplaceable in a way, but many Chinese companies haven’t fully healed from the trauma of geopolitical conflicts between China and the US.”