(Yicai) April 27 -- The Chinese securities watchdog has imposed the first penalty on a domestic company for listing overseas without completing regulatory procedures in the country.

Zhongneng Liangke Agricultural Technology, a Chinese supplier of natural and healthy food products, received an administrative fine of CNY3 million (USD414,000) for launching a US listing without first completing the regulatory filing procedures in China, the China Securities and Regulatory Commission announced on April 24.

This is the first such case since the implementation of the new overseas listing filing rules in March 2023, involving a domestic company listing overseas without completing mandatory procedures.

Zhongneng Liangke’s controller Liangke Technology Innovation Biology Hong Kong, previously known as China Food Investment, submitted a filing report to the CSRC at the end of 2024, planning an indirect listing on the Nasdaq Stock Market through a special-purpose acquisition company, according to the regulator’s announcement.

The CSRC requested Liangke Technology to submit supplementary materials on March 6, 2025, but the company failed to comply, completed the acquisition of the SPAC on Oct. 1, and listed on the Nasdaq under the name CN Healthy Food Technology Group [NASDAQ: UCFI].

After identifying the irregular conduct, the CSRC promptly notified US regulatory authorities and the Nasdaq Stock Market through cross-border supervision cooperation mechanisms. Trading in CN Healthy Food was suspended immediately on the stock’s debut.

In addition to the penalty on Zhongneng Liangke, the CSRC also imposed fines of CNY1.5 million on Jiang Zhenjun, the person in charge of the filing, CNY500,000 (USD69,000) on Guangdong Xinyu Law Firm, the intermediary institution involved, and CNY200,000 on Li Huabin, the lawyer who provided the legal opinion.

The CSRC will balance opening-up and risk control and support qualified Chinese firms in rationally using onshore and offshore markets and resources for high-quality development, it noted, adding that it will also strengthen law enforcement over overseas listing, improve the standardization, normalization, and transparency of filing, and deepen cross-border cooperation with overseas regulators to maintain a sound market order and safeguard the legitimate rights and interests of investors.

On April 24, the CSRC also announced that DSC Holdings had completed regulatory filing for its listing and share offering on Nasdaq. This was the first official document issued by the watchdog confirming the completion of the filing procedure for a US listing by a Chinese company since last December.

Editors: Tang Shihua, Futura Costaglione