| Article 5 |
With the exception of the bonds referred to in Article 4, when an international bond is offered and issued or privately placed by a foreign issuer, if the bond is approved by the Competent Authority as being exempt from the requirement of effective registration with the Competent Authority under Article 22, paragraph 1 of the Securities and Exchange Act, or meets conditions set by the competent authority, the bond may be approved by the GTSM for OTC trading:
An international bond (other than one that meets the criteria of Article 3, paragraph 1, subparagraph 4) that is publicly offered and issued, or privately placed, by a domestic issuer or domestic financial institution, may be approved by the GTSM for OTC trading if it has received a credit rating of BBB or higher from a credit rating agency approved or recognized by the competent authority.
For overseas convertible corporate bonds or overseas corporate bonds with warrants that meet the criteria of Article 3 paragraph 1 and Article 4, application may not be submitted for OTC trading until one month after their issuance overseas. |
| Article 5-2 |
With the exception of the bonds referred to in Article 4, a foreign issuer, before applying for OTC trading, shall first obtain a letter of consent issued by the GTSM indicating that the issuer is permitted to engage in OTC trading. Within 30 days from the issuance date of that consent letter, the issuer shall file for registration of offering and issuance under the Regulations Governing the Offering and Issuance of Securities by Foreign Securities Issuers, or apply for exemption from the requirement of effective registration with the Competent Authority under Article 22, paragraph 1 of the Securities and Exchange Act or apply to the Central Bank for private placement. Upon failure to do so by that deadline, the letter of consent shall become void. |
| Article 6 |
An issuer of international bonds that applies for OTC trading of an international bond, with the exception of the bonds referred to in Article 4, shall submit an Application for OTC Trading of International Bonds (Appendix 1) to the GTSM, filling out all required particulars and including the required attachments.. |
| Article 7 |
After accepting an application for OTC trading of international bonds, the GTSM shall commence a document review of the application and its attachments. Review guidelines, procedures, and deadlines are as follows:
1. The application form:
If, after completion of the relevant checklist by the GTSM, the review reveals omission or incomplete disclosure of any required information, the applicant shall be requested to supplement the information within a prescribed period. If the applicant fails to make supplementation within that period, a notice of rejection shall be issued, with a copy sent to the competent authority.
If there will be domestic natural persons among the subscribers, an international issuer that only prepares an English version of the prospectus that it files for the offering and issuance of international bonds must also attach a Chinese-language sale prospectus that discloses the particulars set out in Appendix 2.
2. Conditions for OTC trading:
(1) Based on the Application for OTC Trading of International Bonds and its attachments, the application shall be reviewed for compliance with each of the conditions for OTC trading set out in Article 5 of these Rules.
(2) When the document review shows that all required documents have been submitted and conditions for OTC trading are met, such OTC trading shall be announced. If it is the initial time that the issuer applies for OTC trading, the GTSM shall separately prepare relevant documents, including the contract for OTC trading entered into with the given issuer, and submit them by mail to the competent authority for recordation.
3. The review period:
The GTSM shall complete review within three business days from the day on which it accepts an application for processing. Notwithstanding the above, under special circumstances the GTSM may file for approval of an extended review period. |
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