The package has established what should be put in application documents from firms seeking an initial public offering (IPO). It also details how law firms should investigate applications.

The new rules, issued on Tuesday, complement changes in the way IPOs are approved by regulators.

Starting from March 17, the CSRC will adopt a new IPO regulatory system which will reduce the government's power in approving IPOs and increase the responsibility of lead underwriters of firms applying to be listed.

Under the new scheme, lead underwriters need to get more involved in the process. If applicants meet designated standards, they will be approved for listing.

In the past, all listing applications had to be examined and reviewed by regulators one by one and the quota for IPOs was limited in each province and region.

Reform of the IPO system is part of the authorities' efforts to bring China's stock market in line with international standards, analysts said.

Less government interference and more transparent regulations will facilitate more market-orientated practices in the bourses, said Cao Yongzhi, an analyst with Guotai J&A Securities.

It will also enable a wider range of firms to be listed, regardless of their ownership or size.

But the reforms will also represent a challenge for securities companies and other intermediaries, as they now need to shoulder more responsibility when backing candidates for listing, Cao said. To protect investors' interests and improve their confidence in new IPOs, regulators have upgraded information disclosure requirements.

(China Daily 03/08/2001)