China took a major step toward seeing Alibaba Group, Baidu and others list in its domestic market, announcing a trial programme that would allow the technology giants to see their shares bought and sold in the world’s most populous country.
The State Council unveiled the plans at the weekend, less than a month after the idea was first made public - a surprising move that underscores how keen authorities are to see foreign-listed Chinese companies come home. A pilot of so-called Chinese depository receipts (CDR) would apply to companies that went public overseas and have a market value of more than 200 billion yuan ($32 billion). The new system will allow firms to use corporate structures that aren’t permitted on the mainland, and monies raised can be moved offshore. Some private companies will also find it easier to come to market.
While China has been a breeding ground for some of the world’s fastest-growing and highest valued tech businesses, companies such as e-commerce giant Alibaba and search engine firm Baidu have headed offshore, leaving the local market reliant on state-run industries for large new listings. The country’s touchiness about stocks with high valuations or no track record of profits is a deterrent for tech firms, as is the ban on structures such as dual-class shares.
“There’s a strong desire to see local champions, these technology companies, come back onshore - and CDRs is one way of doing this,” said David Smith, Asia head of corporate governance at Aberdeen Standard Investments.
Regulators first mooted the prospect of a CDR programme at last month’s meeting of China’s rubber-stamp national legislature. The State Council didn’t say when the trial programme would start.
The news could have global implications. While the likes of Alibaba and Tencent have headed to New York and Hong Kong, respectively, the prospect of at least a secondary listing in the world’s second-biggest equity market could significantly boost their valuations and set an example for other companies.
Hong Kong Exchanges & Clearing stock suffered its worst month in more than a year in March, partly due to the increased threat from exchanges in Shanghai and Shenzhen.
Reconsidering Plans
“High-tech and other innovative enterprises may, in light of the new CDR regime and ongoing competition between onshore and offshore equity exchanges, be reconsidering their IPO plans,” said John Xu, a Shanghai-based analyst at the law firm Linklaters. For example, a dual listing in China and an offshore market may now be realistic, he said.
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“With the new CDR market as an additional source of finance, it may no longer be necessary to unwind existing VIE structures, or restructure shares into the same class, for the purpose of an onshore listing,” said Mr Xu.
Variable interest entity (VIE) structures have been used by many of China’s tech entrepreneurs to set up their companies, but they’re forbidden in mainland markets. By waiving the ban on VIEs, as well as share classes that have different voting rights to give founders more control, CDRs may be establishing new norms, said Mr Smith.
“If these VIE companies are available onshore, what does that mean for the structure?” he said. “While we won’t know for sure, it would seem to be one step closer to normalisation, and this is something investors are watching closely.”
The plans released on Friday say that if VIE and dual-class structures are used, that information should feature prominently in company prospectuses. The securities regulators should consult with other agencies and handle applications from VIEs “prudently, based on varying circumstances.”
While no companies have said they will take part in the trial, the chiefs of several firms have previously expressed interest. Zhou Haibin, an analyst at Essence Securities, identified six foreign-listed companies that meet the plan’s thresholds: Alibaba, Baidu, JD.com, NetEase - which are all in New York - and Hong Kong-listed China Mobile and China Telecom.
Private companies valued at more than 20bn yuan and with revenue of 3bn yuan or more in the past year will also be eligible for the programme, the statement said, along with fast-growing unlisted companies that work in the field of advanced technology and have a leading advantage in their sector. In these cases, however, local rules - for example bans on VIEs and weighted voted rights - will apply.
In numbers: PKK’s money network in Europe
Germany: PKK collectors typically bring in $18 million in cash a year – amount has trebled since 2010
Revolutionary tax: Investigators say about $2 million a year raised from ‘tax collection’ around Marseille
Extortion: Gunman convicted in 2023 of demanding $10,000 from Kurdish businessman in Stockholm
Drug trade: PKK income claimed by Turkish anti-drugs force in 2024 to be as high as $500 million a year
Denmark: PKK one of two terrorist groups along with Iranian separatists ASMLA to raise “two-digit million amounts”
Contributions: Hundreds of euros expected from typical Kurdish families and thousands from business owners
TV channel: Kurdish Roj TV accounts frozen and went bankrupt after Denmark fined it more than $1 million over PKK links in 2013
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The rules on fostering in the UAE
A foster couple or family must:
- be Muslim, Emirati and be residing in the UAE
- not be younger than 25 years old
- not have been convicted of offences or crimes involving moral turpitude
- be free of infectious diseases or psychological and mental disorders
- have the ability to support its members and the foster child financially
- undertake to treat and raise the child in a proper manner and take care of his or her health and well-being
- A single, divorced or widowed Muslim Emirati female, residing in the UAE may apply to foster a child if she is at least 30 years old and able to support the child financially
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Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
Tuesday's fixtures
Kyrgyzstan v Qatar, 5.45pm
Formula Middle East Calendar (Formula Regional and Formula 4)
Round 1: January 17-19, Yas Marina Circuit – Abu Dhabi
Round 2: January 22-23, Yas Marina Circuit – Abu Dhabi
Round 3: February 7-9, Dubai Autodrome – Dubai
Round 4: February 14-16, Yas Marina Circuit – Abu Dhabi
Round 5: February 25-27, Jeddah Corniche Circuit – Saudi Arabia
What is Folia?
Prince Khaled bin Alwaleed bin Talal's new plant-based menu will launch at Four Seasons hotels in Dubai this November. A desire to cater to people looking for clean, healthy meals beyond green salad is what inspired Prince Khaled and American celebrity chef Matthew Kenney to create Folia. The word means "from the leaves" in Latin, and the exclusive menu offers fine plant-based cuisine across Four Seasons properties in Los Angeles, Bahrain and, soon, Dubai.
Kenney specialises in vegan cuisine and is the founder of Plant Food Wine and 20 other restaurants worldwide. "I’ve always appreciated Matthew’s work," says the Saudi royal. "He has a singular culinary talent and his approach to plant-based dining is prescient and unrivalled. I was a fan of his long before we established our professional relationship."
Folia first launched at The Four Seasons Hotel Los Angeles at Beverly Hills in July 2018. It is available at the poolside Cabana Restaurant and for in-room dining across the property, as well as in its private event space. The food is vibrant and colourful, full of fresh dishes such as the hearts of palm ceviche with California fruit, vegetables and edible flowers; green hearb tacos filled with roasted squash and king oyster barbacoa; and a savoury coconut cream pie with macadamia crust.
In March 2019, the Folia menu reached Gulf shores, as it was introduced at the Four Seasons Hotel Bahrain Bay, where it is served at the Bay View Lounge. Next, on Tuesday, November 1 – also known as World Vegan Day – it will come to the UAE, to the Four Seasons Resort Dubai at Jumeirah Beach and the Four Seasons DIFC, both properties Prince Khaled has spent "considerable time at and love".
There are also plans to take Folia to several more locations throughout the Middle East and Europe.
While health-conscious diners will be attracted to the concept, Prince Khaled is careful to stress Folia is "not meant for a specific subset of customers. It is meant for everyone who wants a culinary experience without the negative impact that eating out so often comes with."
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
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