(Yicai Global) Oct. 19 -- The Hong Kong Stock Exchange has published a consultation paper on new listing rules for so-called specialist technology companies, proposing to create a new channel for these firms to go public on the bourse’s main board.

The new rules would apply to firms in five fields: next-generation information technology; advanced hardware; advanced materials; energy conservancy and environmental protection; new foods and agricultural technologies, according to the proposal the bourse released today. It is seeking market feedback by Dec. 18.

“Just as the launch of our biotech chapter led to a whole new healthcare financing ecosystem in Hong Kong, we expect the new proposed specialist technology rules will help drive growth in talent and investment across these five frontier industries,” HKEX Chief Executive Nicolas Aguzin said.

Specialist technology companies would be divided into commercial and non-commercial ventures under the proposed new rules, with more stringent rules for the latter due to the higher risk.

The new rules require that the minimum expected market capitalization of commercial firms at the time of listing should be HKD8 billion (USD1 billion), while the figure for non-commercial firms is HKD15 billion.

All applicants must have been doing research and development for at least three financial years prior to listing, with commercial ventures needing to spend at least 15 percent of their total operating expenditure on R&D. The threshold for non-commercial firms is 50 percent.

“These new proposals will expand the range of companies that can access Hong Kong’s deep, liquid, international markets and will offer investors even greater choice,” Aguzin added.

In a wide-ranging policy address today, Hong Kong’s new leader John Lee said the Hong Kong Stock Exchange will revise its main board listing rules next year to help advanced tech enterprises that have yet to meet profit and trading record requirements raise funds.

The market for initial public offerings in Hong Kong picked up in the third quarter of this year, with a total of 29 new listings raising a total of HKD53.5 billion (USD6.8 billion), more than double that of the first half, according to the earning report Hong Kong Exchange and Clearing, the bourse’s operator, released today.

In the first three quarters, 56 IPOs were launched, raising HKD73.2 billion, the report said.

Editor: Peter Thomas