| 1. What options do I have? |
| You have several options to establish a listing status in Hong Kong while maintaining or transitioning from your US listing:
US primary listing + Hong Kong primary listing
- Alibaba (9988.HK, BABA.US) – upgraded from secondary to dual-primary listing on HKEX
US primary listing + Hong Kong secondary listing
- JD.com (9618.HK, JD.US) – primary listing on NASDAQ and secondary listing on HKEX
Delisting from the US & full migration to HKEX
- China Mobile (941.HK, CHL.US) – delisted from NYSE and now solely listed on HKEX
What is HKEX promoting?
- The HKEX has streamlined its listing regime to facilitate US-listed Chinese issuers to achieve dual primary listing or secondary listing on the HKEX
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| 2. How do you decide between a primary listing vs a secondary listing on HKEX? |
| Key considerations include:
Trading volume and liquidity
- Primary listings on HKEX typically attract more liquidity and investor interest
- Secondary listings may still rely on US trading volume
Exemptions and waivers
- Primary listings must fully comply with the Hong Kong Listing Rules
- Secondary listings, subject to certain requirements, enjoy certain exemptions and waivers (e.g. retaining their existing WVR and/or VIE structures, and automatic waivers from corporate governance and disclosure requirements)
Eligibility for key indices and stock connect
- Primary listings are eligible for Hang Seng Index and Southbound Stock Connect, enhancing access to mainland Chinese investors
- Secondary listings may face restrictions (e.g. not all secondary listed stocks are included in Stock Connect)
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| 3. Do I need to raise funds? |
| You can choose to list with or without fundraising:
Listing with fundraising (IPO)
- XPeng (9868.HK, XPEV.US) – dual-primary listed on NYSE and HKEX, and raised new fund at its Hong Kong listing
Listing without fundraising (Introduction)
- KE Holdings (2423.HK, BEKE.US) – dual-primary listed on NYSE and HKEX, and did not raise new fund at its Hong Kong listing
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| 4. Do I need to amend the articles of association? |
- Yes, HKEX requires certain corporate governance adjustments
- HKEX requires all issuers, including those seeking secondary listings, to demonstrate how domestic laws, rules and regulations to which they are subject, and their constitutional documents, in combination, provide shareholder protection under the Hong Kong Listing Rules
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| 5. Can I use US GAAP or IFRS as auditing standard? |
- Accountants’ reports in the prospectus must normally be drawn up in conformity with one of the following auditing standards: HKFRS or IFRS
- US GAAP may only be adopted by issuers that have, or seeking, dual-primary or secondary listing in both the US and on HKEX
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| 6. Is VIE structure acceptable? |
- US-listed Chinese issuers seeking dual-primary listings on HKEX are required to fully comply with the HKEX requirements for their existing VIE structure
- US-listed Chinese issuers (Grandfathered Greater China Issuer) are allowed to secondary list on HKEX with their existing VIE structure in place without full compliance with the requirements of HKEX
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| 7. Do I need to file with CSRC again? |
- Yes, US-listed Chinese issuers are generally required to comply with the filing regime of the CSRC when seeking a primary listing or a secondary listing on HKEX
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| 8. What professionals do I need? |
- Core professionals include: listing sponsor, legal advisors (as to Hong Kong laws, US laws & PRC laws) and reporting accountants
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| 9. How long will it take? |
- Secondary listing: ~4-6 months
- Primary listing: ~6-12 months
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| 10. What are the basic eligibility requirements? |
- Financial eligibility – HK$80M aggregate profit (3 years) + HK$500M market cap / HK$500M revenue + HK$100M positive cash flow (3 years) + HK$2B market cap / HK$500M revenue + HK$4B market cap
- Chapter 18A – Biotech companies with no revenue
- Chapter 18C – Specialist technology companies with or without revenue
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