On February 11, the CSRC issued the regulations on the supervision of interconnected depositary receipts business of domestic and foreign stock exchanges (hereinafter referred to as the regulations), which expanded the scope of domestic and foreign stock exchanges participating in interconnected depositary receipts business, allowed overseas issuers to raise funds in China through issuing CDRs, and optimized continuous supervision arrangements. Experts said that the deepening of the interconnection mechanism between domestic and foreign exchanges has improved the internationalization level of China's capital market, promoted the optimal allocation of capital factor resources in the world, and laid a good foundation for the two-way opening of the capital market in the next step. The Shanghai and Shenzhen Stock Exchange and high-quality leading listed companies from the UK, Switzerland and Germany are expected to benefit from the opportunity to be listed and raised in many places around the world. Intermediaries with cross-border investment and financing services are also expected to increase their income, and investors will also welcome more high-quality investment targets. High quality listed companies and institutions Expected to benefit The 2022 system work meeting of the CSRC proposed to unswervingly promote institutional opening-up. Steadily expand the high-level two-way opening of markets, institutions and products, and deepen the interconnection of domestic and foreign markets. From the domestic point of view, the amendment expands the interconnected depositary receipts business from Shanghai Stock Exchange to Shenzhen Stock Exchange, and from the UK to Switzerland and Germany. Tian Lihui, President of the Financial Development Research Institute of Nankai University, said in an interview with the reporter of Securities Daily that the expansion of interconnected depositary receipts business has promoted the process of China's financial opening. Based on the foundation and experience of Shanghai Luntong, China promotes the orderly interconnection and interworking of depositary receipts business in major stock exchanges at home and abroad, which can effectively promote the internationalization of China's Shanghai and Shenzhen stock exchanges and facilitate the cross-border investment and financing of domestic and foreign institutions, enterprises and families, so as to enhance the international influence of China's capital market and promote the construction of international capital serving China's real economy, Promote the global optimal allocation of capital factor resources. Zhao Xijun, CO president of China Capital Market Research Institute of Renmin University of China, said in an interview with reporters that for the domestic capital market, the interconnected depositary receipts business has been expanded from Shanghai Stock Exchange to Shenzhen Stock Exchange, the scope of listed companies meeting the conditions for issuing CDRs abroad has been further expanded, and high-quality listed companies on Shenzhen Stock Exchange are expected to expand financing space. Overseas, the expansion from the UK to the Swiss and German markets has expanded the choice space for domestic enterprises to issue global depositary receipts, which is conducive to listed companies to make full use of the financing development of domestic and foreign markets and improve the internationalization level of the capital market. In addition, the further deepening of the opening of the capital market to the outside world is also of positive significance to the opening of the capital and financial accounts of the balance of payments. "The 'double expansion' of the interconnected depositary receipts business at home and abroad has brought more high-quality assets of listed companies to the capital market." Xie Yaxuan, deputy general manager of Strategic Research Department of China Merchants Securities R & D center, said in an interview with Securities Daily that for the domestic capital market, investors are expected to invest in CDRs issued by Listed Companies in the UK, Switzerland and Germany. For overseas capital markets, in addition to investing in global depositary receipts issued by companies listed on the Shanghai Stock Exchange, foreign investors are also expected to invest in global depositary receipts issued by companies listed on the Shenzhen Stock Exchange. High quality leading listed companies from the UK, Switzerland, Germany and Shanghai and Shenzhen stock exchanges can benefit and obtain opportunities for listing and financing on a global scale. Zhao Xijun said that in the future, with the in-depth promotion of interconnected depositary receipts business, in addition to high-quality listed companies, intermediaries with service capabilities matching cross-border investment and financing are also expected to benefit. In the process of deepening the two-way opening of the capital market, the demand for cross-border investment and financing business is increasing, and the relevant business income of brokers and other intermediaries is expected to increase. From the aspects of market, products, etc Further explore opening to the outside world The regulatory provisions allow overseas issuers to raise funds in China by issuing CDRs, refer to the registration system and adopt a market-oriented inquiry mechanism, which is also one of the highlights of this amendment. "In addition, allowing overseas issuers to issue CDRs with reference to the rules of the registration system and adopting a market-oriented inquiry mechanism for pricing will help to be consistent with international rules. This is also consistent with the decision and deployment of the full implementation of the stock issuance registration system in China, help to facilitate the financing of overseas basic securities issuers and further promote the reform of the registration system in the domestic capital market." Xie Yaxuan said. "The fair pricing mechanism is also the basis for the issuer to adopt the domestic market to optimize the pricing process, and allow the issuer to adopt the overseas market to optimize the capitalization process." Tian Lihui said. In recent years, institutional opening of the capital market has been continuously promoted, the QFII / rqfii system has been continuously optimized, the Shanghai Shenzhen Hong Kong stock connect mechanism has been further improved, the interconnection of depositary receipts business has been expanded, and institutional two-way opening of the capital market has been promoted. For the next step of institutional opening of the capital market, Zhao Xijun believes that in the future, regulators can further promote the market, open channels and products. On the premise of further improving the existing open system, we should study more open channels and establish Interconnection Mechanisms with more countries to facilitate foreign high-quality enterprises and investors to enter the domestic capital market and promote domestic high-quality enterprises to go global. In addition, further expand the varieties of interconnection. In addition to depositary receipts, bonds, funds and derivatives are all varieties that can be considered in the future, which can facilitate the portfolio investment of foreign investors. "Especially for derivatives instruments, foreign investors need risk prevention when making cross-border investment, and there is an urgent need for instruments that can hedge investment risks." Zhao Xijun said that the launch of each new variety is an arrangement of a new system, which will also be accompanied by new regulatory risks. While constantly optimizing the system, regulators need to improve the regulatory system and prevent financial risks. (Xinhua News Agency)