The full circulation of H shares is a special institutional problem. At present, some mainland companies listed on Hong Kong stocks adopt the red-chip model, that is, domestic companies directly acquire domestic assets or transfer VIE to overseas offshore companies, and then list as overseas offshore companies, which is basically equivalent to "full circulation overseas" from the beginning of listing; The other part adopts the H-share model, that is, shares are divided into domestic shares and foreign shares at the time of listing. After listing on the Hong Kong Stock Exchange, foreign shares can circulate abroad, while domestic shares cannot.
What are the conditions for the full circulation of H shares? Full circulation, that is, through system design, makes these domestic legal person shares and state-owned shares that cannot be circulated be converted into H shares to be listed and traded on the Hong Kong Stock Exchange. Yang Lingxiu, chief Hong Kong stock analyst of CITIC Securities, believes that "full circulation" will also bring fundamental changes to the equity of H-share enterprises, and the problem of "inconsistency between domestic and foreign shareholders" will be solved, which will enhance corporate governance and market competitiveness in the medium term. In his view, the significance of "full circulation of H shares" is no less than the second listing of H shares companies in Hong Kong.
According to the documents of the CSRC, enterprises participating in the pilot project of "full circulation" of H shares must meet four basic conditions. First, it must comply with foreign investment access, state-owned assets management, national security and industrial policies and other relevant legal provisions and policy requirements; Second, the industry conforms to the development concept of innovation, coordination, green, openness and enjoyment, and conforms to national strategies such as serving the real economy and supporting the construction of the "Belt and Road"; Third, the ownership structure of existing shares is relatively simple, and the market value of existing shares is not less than HK$ 654.38+0 billion; Fourth, corporate governance norms.