Keywords: Chinese company, list overseas, apply for listing requirements, investigate, verify, basic information, background, credit status

An increasing number of Chinese firms are sizing up overseas markets for initial public offerings (IPO). This is due to a large number of Chinese companies ready to emerge in the international market and they want to expand their shareholder base and to acquire currency for mergers and acquisitions.

Listing overseas has many advantages, such as assessing international market; enhancing the status and financial standing of the company; increasing public awareness and public interest in the company and its products; having the ability to attract and retain more highly qualified personnel with the opportunity to implement share option schemes for their employees, etc. Just because of these advantages, more and more companies apply for listing overseas.

Certainly, it has some requirements and standards for listing overseas. For example, in Singapore, a company, foreign or locally-incorporated, seeking primary or secondary Singapore Stock Exchange listing, may list via three main criteria alternatives. And one of them is: the Company has cumulative pre-tax profit of at least S$7.5 million over the last three consecutive years, with a pre-tax profit of at least S$1 million in each of those three years; 25% of issued shares must be in the hands of at least 1,000 shareholders; the Company must have been in operation for three years; the Company must adhere to Singapore, US or international accounting standards; and the Company enjoys a waiver from continued Singapore Stock Exchange listing obligations if it is listed on another recognized foreign stock exchange.

However, some companies, which do not meet the requirements, sell their stocks illegally. Many individuals are cheated and loose lots of money. So, how to prevent it? First, we must be careful, and do not believe some “good chance” easily. Second, we may ask professional investigation organizations for help. They could professionally investigate and verify the fact of the “good chance”, such as its basic information, background, credit status, etc., which makes us know more about the “good chance”. Last, make the decision according to the investigation results. In this way, the possibility of being treated could be reduced, and the unnecessary loss could be prevented effectively.