In the context of globalization, the listing of Chinese enterprises in the United States has become an important way to broaden financing channels and enhance international competitiveness. However, it is not easy to successfully enter the international capital market in the United States. It needs to strictly abide by the laws and regulatory requirements of the United States, and also needs to complete the filing and approval of the China Securities Regulatory Commission.

An Overview of the U. S. Capital Markets

The American capital market has attracted the attention of many enterprises around the world with its high degree of maturity and liquidity. Major stock exchanges include the New York Stock Exchange (NYSE), the Nasdaq Stock Exchange (NASDAQ), the National Stock Exchange (AMEX) and the over-the-counter market (OTC). Among them, NYSE and NASDAQ are the most important listing places, characterized by large enterprises and growth enterprises respectively.

Listing process in the United States

1. Select intermediary agencies: Enterprises need to employ listing service intermediary agencies, coordinate the underwriter team, lawyer team, auditor team and other institutions, and complete the necessary legal, audit, information disclosure and other important work. Choosing the right intermediary agency can improve the listing success rate and reduce the risk.

2. Apply to the overseas CSRC or exchange: Before submitting the application to the overseas CSRC or exchange, the approval of the overseas regulatory authorities is required. Materials submitted need to include all necessary documents and legal opinions.

3. Complete the filing process: When submitting the listing application to SEC, the enterprise shall submit to the filing application of the CSRC, follow the filing management system of the China Securities Regulatory Commission, submit the necessary filing materials, and complete the filing process. Since March 31,2023, the Trial Measures for the Administration of Overseas Securities Issuance and Listing of Domestic Enterprises and relevant supporting guidelines (referred to as the "New Rules on Overseas Listing") have been formally implemented. In the past six months, under the framework of the new regulations on overseas listing, the application for domestic enterprises' overseas listing has gradually normalized.

4. Roadshows and pricing: Roadshows are a key link in demonstrating business, prospects and investment value to potential investors. The pricing mechanism is usually determined by the market supply and demand, through the cumulative bidding inquiry system and other ways.

5. Securities underwriting: The underwriters are responsible for selling the company's shares to investors. Underwriting and commission are two main underwriting methods, each has its advantages and disadvantages and risk and return characteristics.

6. Listing: the issuer can be listed after being approved by the SEC and the exchange. After the listing, the issuer should also submit the final version of the prospectus containing the final offering price to the SEC.

Conditions for listing in the United States

There are different conditions and requirements for different listed plates in the United States. For example, the New York Stock Exchange (NYSE) focuses on conditions including financial requirements, net profit requirements, tradable share requirements, market value requirements, shareholder requirements and legal compliance, corporate governance, etc. For example, the Nasdaq Exchange (NASDAQ), which operates three sectors: global selected market, global market and capital market. Different markets have different standards for finance, tradable shares, market value, shareholders and other important standards, but the three sectors need to meet the standards of corporate governance structure and legal compliance disclosure.

Going public in the United States

Direct IPO: Domestic enterprises directly apply to the overseas securities authorities for stock issuance and stock listing and trading.

Shell listing: a non-listed company buys a certain proportion of the equity of a listed company to obtain the listing status, mainly for the enterprises with a depressed industry and a small share capital. Buy shell after the market restrictions are more.

SPAC listing: first shell and raise funds, then merger and acquisition, and finally make the acquisition object become a listed company. It has the characteristics of fast time, less cost, simple process and guaranteed financing, and has great advantages for both investors and target companies.

In recent years, the main ways for Chinese companies to list in the United States do indeed include traditional IPO and SPAC. Under the SPAC model, the whole process from the establishment of SPAC to the completion of the merger usually takes only 3-6 months. Because SPAC is already a listed company, it avoids the registration and approval process in traditional IPO, making the time to listing more controllable and fast. In contrast, a traditional IPO can take one to two years, including a series of complex processes such as preparing financial statements, market reviews, and roadshows. SPAC combined IPO has obvious advantages over traditional IPO in terms of time controllability and cost, which is also one of the reasons why more and more companies choose SPAC as the listing route in recent years.

Listing in the United States is an important step in the internationalization of Chinese enterprises, which requires careful planning and preparation by enterprises. By understanding the listing process, meeting the listing conditions, and formulating appropriate listing strategies, the enterprise can successfully complete the overseas listing, and realize the layout of the global capital market.

Since 2009, the group has adopted the SPAC listing model to help many small and medium-sized enterprises in Asia to list overseas, looking forward to the cooperation with you!