HKEx Launches New Board Proposals

The much anticipated consultation of a new board (the "New Board") has been announced and the Stock Exchange of Hong Kong Limited (the "HKEx") is inviting public feedback on these two separate but related consultations:

  1. a proposal to establish the New Board; and
  2. proposed changes to the Growth Enterprise Market ("GEM") and Main Board Listing Rules.

The proposals aim to broaden capital markets access in Hong Kong and strengthen our listing regime.  Although the proposals are set out in separate consultations, they are interlinked and should be viewed holistically.


The concept of a third board was initially proposed in January 2016 by the HKEx in its 2016/18 Strategic Plan.  At that time, it was mentioned that a new board would be aimed at new industries that do not fit the requirements of the Main or GEM Boards, and there were mixed views from the market and industry professionals. The SFC made clear that a new board would not be suitable until the role of the GEM was made clear.

There is, without any doubt, a need for Hong Kong to capture a greater share of listings by international and Mainland Chinese companies and to fill the gaps identified in the current listing regime, including accommodating:

  1. "pre-profit" companies;
  2. companies with non-standard governance procedures; and
  3. Mainland Chinese companies wishing to secondarily list in Hong Kong.

The key objectives of introducing the New Board are to (i) diversify sector and geographic concentrated listings in Hong Kong, and (ii) increase the territory's exposure to higher growth sectors.  To enable Hong Kong to raise its competitiveness for more listings, it will also need to ensure its regulatory framework remains robust and key investor protection measures are maintained.

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