A landmark decision by the Hong Kong Stock Exchange approving Guernsey as an ‘acceptable overseas jurisdiction’ for listing marks the second time in just over two years the exchange has approved an offshore jurisdiction.
Following the decision, Guernsey incorporated companies wishing to list its shares on the HKEx will now be enabled to do so through a streamlined listing process. This move follows hot on the heels of the Dec 2009 approval for British Virgin Islands (BVI) incorporated vehicles to list on the exchange. In Oct 2010, Winsway Coking Coal Holdings became the first BVI-incorporated company to list on the main board of the HKEx in its US$661m offering and utilize the new agreement.
The application, made by the Guernsey government, was guided by Guernsey-based Ogier partner Caroline Chan and Hong Kong-based Ogier partner Marcus Leese. “A listing on the HKEx provides significant investor reach for those wishing to target Asian investors,” Leese said. “It gives Guernsey [lawyers] who wish to extend their practice into Asia, and have a greater Asian focus in their practice, a platform to do so. But for us, our Asian focus is central to our business and is something we are committed to.”
Other approved jurisidictions on the HKEx include Cayman, BVI and Jersey.
According to Leese, the process of assisting the Guernsey government in its application took over a year and involved submitting information about the country’s company law system. “The process effectively involved providing the exchange with comfort that the laws relating to corporate governance, and shareholder protection were of a sufficiently high standard,” he said.
Both partners agree that the firm sees ‘a substantial pipeline of new listings on the HKEx’ following the Guernsey approval. “It gives those considering doing an IPO, further choice. It gives another option to consider for those looking at an offshore jurisdiction to establish their listing vehicle. One other aspect involves those who currently have their businesses structured through a Guernsey company, to now have another avenue for listing, allowing them to list in Hong Kong without establishing another listing vehicle,” Leese said.
Maples and Calder assisted the British Virgin Islands in its application to the HKEx in 2009. The firm also advised on the Winsway Coking Holdings IPO in a team led by partner John Trehey.ALB
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