Xie Bing FCIS FCS, Board Secretary, China Southern Airlines, explains four factors relating to the compliance risks and challenges of A+H share listed companies.

During the last few years, the Mainland and Hong Kong capital markets have been in an expansionary phase with frequent innovations. The two capital markets have also seen marked increases in interactions and cooperation amongst regulators, particularly following the implementation of the Shanghai-Hong Kong Stock Connect, with its related synergies and cooperation. The regulatory philosophies of the regulator have also seen an incremental convergence in the face of the ever rapidly evolving and increasingly complex capital market which requires strengthening of regulatory oversight and synergies as the choice approach of regulators. This means increasing compliance risks and challenges for A+H share companies, flowing from the four main factors set out below.

The 'through-train’ increases disclosure pressures and responsibilities 

Against the backdrop of the China Securities Regulatory Commission (CSRC) efforts to deepen the Mainland's securities structural reforms, the Shanghai and Shenzhen stock exchanges are increasing the speed of regulatory changes. The basis of these reforms relates to the protection of investor interests and satisfying their needs, and information disclosure at the core, and regulatory controls both during and after the event as the regulatory philosophy. The implementation of the Shanghai and Shenzhen 'through train’ – the direct connection between the Hong Kong and Mainland stock markets – means that disclosure of information in the Mainland will be moving from the minimum compliance-based approach and converging towards Hong Kong and international practice where listed companies really take on their disclosure responsibilities. The Stock Connect programme involves large-scale regulatory changes, and represents a milestone and pathway towards a more mature capital market. But, in comparison to the more mature Hong Kong market, the Mainland's capital market environment still has some areas that are less mature and comprehensive. In relation to the disclosure of inside information, in the Mainland the professionalism of intermediaries like consultants and lawyers is relatively low. This means that, for A+H shares and A share companies, the level of support that they can obtain externally from such intermediaries in comparison to H-share companies is lower. With the implementation of the through-train disclosure mechanism, A+H share companies, in their A share disclosure work, are inevitably faced with more risks and challenges in terms of meeting Hong Kong's disclosure requirements. Companies’ board secretaries and their teams need to be more diligent and professional in carrying out their duties relating to information disclosure.

Comprehensive regulation increases information disclosure difficulties and risks

The Chairman of the CSRC, Liu Shiyu, at the time of the National People's Congress (NPC)/ China's People Political Consultative Committee's (CPPCC) meeting, made it clear that his mission is regulation, and that regulation should be according to the law and effected in a comprehensive manner. Furthermore, information disclosure is a core concern. In recent years, the Shanghai and Shenzhen exchanges have learnt from Hong Kong's experience. On the one hand, there has been a strengthening of inside information regulation during and after the event, and on the other, there has been an emphasis, not only on authenticity, accuracy, completeness and timeliness, but also on effectiveness, comparability, conciseness and the relevance of disclosures. Corporate disclosure should be approached from the investor's perspective, should be clear and explain risks to satisfy the increasing and diverse needs of investors. Broadly speaking, these manifest in two aspects: the first is the regulation of different industries. In 2015, the Shanghai Stock Exchange began to implement disclosure requirements for different industries. It required listed companies to strengthen disclosure in line with its industry over the company's financial information and business operations with a horizontal comparison with its peers. It also required companies to disclose significant risks to enhance regulatory effectiveness. Secondly, there is the strengthening of during and after the event regulation, through a multi-dimensional monitoring of companies’ voluntary disclosure relating to the internet, virtual financial and other market 'hot topics’ as part of the regulatory method. Additionally, there has been a continuous strengthening of the post-vetting of companies’ annual reports. The above increases the difficulties and risks faced by A+H share companies. A listed company has to disclose more comprehensively, with more attention to effectiveness, comparability, brevity and relevance of disclosures.

Inside information regulatory pressures are ever increasing 

In recent years, both Hong Kong and Mainland regulators have been increasingly concerned about inside information controls. The CSRC, and the Shanghai and Shenzhen stock exchanges, in addition to preserving the existing current insider filing system, have also strengthened their monitoring of price fluctuations, potential inside information leakage, insider dealing and other illegal activities. In respect to insider dealing, the strength of enforcement is ever increasing. In 2012, Hong Kong's regulator upgraded disclosure regulations from stock exchange rules to statutory requirements, and a violation thereto could lead the company, its directors and senior managers to being exposed to direct responsibility and legal consequences with a maximum fine of HK$8 million. Board secretaries and theircompliance teams need to continuously assess and perfect the company's internal inside information management system, especially strengthening insider training and management. Also, as to the timing of disclosure, this must be done cautiously, to ensure that the inside information disclosures are timely and compliant.

The need for faster response times 

Regulators in both the Mainland and Hong Kong have strengthened the requirement for timeliness of responses to regulatory enquiries. The Hong Kong regulators have real-time monitoring of media reports relating to important matters, and they are in continuous communication with companies. Likewise, the Shanghai Stock Exchange has recently strengthened the monitoring of price fluctuations and media reports. If there are significant rumours in the market, both regulators in Hong Kong and Mainland make enquiries and seek verification from the company. If necessary, the listed company would be required to issue a clarification announcement. In order to facilitate real time disclosures, the Shanghai Stock Exchange has introduced new morning, afternoon and after-hours disclosure windows. In a way, this narrows the gap in information disclosure with the Hong Kong market, and enhances the efficiency of inside information disclosure, and in another way, allows for the listed company to clarify inside information to manifest speedy disclosure reactions to the market. A+H listed companies must strengthen daily market information monitoring; enhance communications with controlling shareholders and the like with efficiency; build effective and reactive mechanisms; deal with and react to emergency situations; answer exchange queries; and, as required by the exchanges, issue clarification announcements, along with coordinating the A and A+H share disclosures and consistency.

Conclusion

In summary of the above, A+H listed companies compliance work is involved and far reaching, particularly in the context of the regulatory changes in the Mainland and the convergence between Mainland and Hong Kong regulations. Board secretaries must be diligent in performing their duties, and form a more professional team and build comprehensive compliance regulations. There is also a need to facilitate and manage compliance work flow with a high degree of responsibility, a strict work attitude and outstanding knowledge of risk to perform the listed company's compliance work. Xie Bing FCIS FCS Board Secretary, China Southern Airlines  

兩地上市公司的合規風險與挑戰綜述

南方航空董秘謝兵透析A+H上市公司在合規工作四大範疇的風險與挑戰。

近年來，中國內地和香港資本市場快速發展、不斷創新，兩地資本市場交流和合作顯著增多，尤其是滬港通的實施顯著加強了兩地監管機構的聯繫與協同，兩地監管理念也逐步趨同。面對瞬息萬變，日趨複雜的資本市場，加強上市公司監管是兩地監管機構的共同選擇，A+H上市公司合規風險與挑戰與日俱增，主要體現在以下四個方面。

1. 信息披露直通車加大了信息披露工作的責任和壓力

在中國證監會深化證券監管體制改革的背景下，滬深交易所加快了上市公司監管轉型的步伐，以保護投資者利益，滿足投資者需求為導向，確立了以信息披露為核心，加強事中和事後監管的監管理念。滬深交易所信息披露直通車的實施，告別了過去“保姆式”的監管模式，實現了與香港等國際資本市場的接軌，使上市公司真正承擔起信息披露的主體責任。可以說，直通車是中國證券市場監管方式的一次重大變革，也是中國資本市場逐步走向成熟的表現和標誌之一。 但是，同香港等成熟資本市場相比，內地資本市場環境還存在不成熟、不完善的地方，就信息披露而言，主要體現在合規律師、合規顧問等專業化中介機構市場化程度比較低。 A+H上市公司涉及A股的信息披露工作比涉及H 股信息披露工作可藉助的外力要少很多。在信息披露直通車實施後，A+H上市公司在A股信息披露工作中面臨著挑戰和風險，需要公司董事會秘書及團隊更加專業、嚴謹的做好信息披露工作。

2. 全面監管增加了信息披露工作的難度和風險

中國證監會劉士餘主席在全國兩會期間曾表示， 其首要任務就是監管，並且要依法監管、從嚴監管、全面監管，而信息披露又是監管的核心。近年來滬深交易所持續借鑒香港監管機構的經驗，一方面加強信息披露的事中和事後監管，另一方面對上市公司信息披露監管重點已從過去的真實性、準確性、完整性、及時性，轉為更加強調信息披露的有效性、可比性、簡明性、針對性，要求上市公司的信息披露要從投資者角度出發，清晰易懂、充分揭示風險，滿足投資者日益多元化的需求。 具體來講，主要表現在兩個方面，一是，分行業監管。 2015年上海證券交易所開始實施信息披露分行業監管，要求上市公司加強對同行業公司財務信息、經營業務、商業模式的橫向比較分析，要求公司充分揭示重大風險，進一步提高信息披露監管的有效性和可比性。二是，加強事中事後監管，通過多維度舉措，對公司自主發布的涉及互聯網金融、虛擬現實等市場熱點題材的公告採取“ 刨根問底” 的監管模式；並持續加強對上市公司年報的事後審核力度，尤其是對年報“高送轉”信息披露的監管力度。 監管轉型帶來的上述變化增加了A+H上市公司的信息披露工作的難度和風險，上市公司信息披露的內容要更加全面，要更加註重披露內容的有效性、可比性、簡明性和針對性。

3. 內幕信息管控壓力越來越大

近年來，兩地監管機構均特別注重內幕信息的管控。內地證監會、滬深交易所除了保持原有內幕信息知情人報備製度以外，還特別加強了價格異常波動及可能涉及內幕信息洩露、內幕交易等違法行為的督查，對內幕交易的打擊力度日益加強。香港監管機構2012年也正式將內幕信息的披露從交易所條文要求上升為法律規定，違反相關規定會導致公司或者董事、高級管理人員直接承擔法律責任，最高罰款可至港幣800萬元。因此，A+H上市公司董事會秘書及團隊需要不斷檢討和完善公司內幕信息管理制度，加強對內幕知情人的風險提示和管理， 在內幕信息的保密程序、披露時機上更謹慎，確保上市公司內幕信息管理和披露的合法合規。

4. 上市公司應對監管機構的快速反應能力要求更高

兩地交易所對於上市公司的監管實時性正逐漸加強，香港聯交所對於新聞媒體報導涉及公司的重大事項予以實時監控，隨時與公司保持溝通。上交所近年來也加強了對股票價格異常波動和新聞媒體報導的監控力度。一旦市場上出現有關上市公司的重大傳聞，兩地交易所就會分別向公司進行問詢和核實，如有必要還會要求上市公司及時發布相關澄清公告。為了配合實時監管，上交所還出台了多時段信息披露制度，新增了交易日早間、午間以及非交易日披露時段，一方面縮小了與香港市場信息披露時段的差異，提高上市公司信息披露效率，另一方面也為上市公司及時澄清、披露提供了條件，實現對市場關切的快速反應。 因此，A+H上市公司必須加強對市場輿情的日常監控，提高與控股股東等相關方的溝通效率，建立有效的應急處置預案，確保在有緊急情況下能夠快速反應，及時回復交易所的問詢並按照交易所的要求發布澄清公告，並妥善處理好A股和H股信息披露的一致性。

結論

綜上所述，在中國內地監管機構不斷深化監管轉型和兩地監管逐步趨同的情況下，A+H上市公司合規工作可謂任重道遠，董事會秘書必須更加嚴格的履行忠實、勤勉義務，需要打造更加專業的團隊，建立和完善公司各項合規制度，梳理和改善合規工作流程，以高度的責任心、嚴謹的工作態度和傑出的風險意識做好上市公司的合規工作。 謝兵 公會資深會士 南方航空董秘