Hong Kong Exchange Proposes Looser Listing Rules — Update

By Jiahui Huang and Kimberley Kao

Hong Kong's stock exchange has drawn up plans to make it easier for companies to go public, aiming to strengthen the city's appeal as a fundraising hub as the Asian financial center regains its standing as the world's top listing destination.

The stock exchange on Friday proposed cutting the minimum listing requirement for companies with a weighted voting-rights structure to a market capitalization of 20 billion Hong Kong dollars, equivalent to US$2.56 billion, half the HK$40 billion required currently.

For companies with this dual-class structure choosing to list using revenue as a criterion, it plans to lower the market capitalization and revenue thresholds to HK$6 billion and HK$600 million, respectively, from HK$10 billion and HK$1 billion previously.

The exchange also proposed changing the weighted voting ratio to 20 to 1 from 10 to 1 for companies with a market capitalization of at least HK$40 billion, making it easier for companies with greater founder control to pursue an initial public offering in Hong Kong.

The stock exchange is seeking market feedback on the listing proposals, with the consultation period ending May 8. Hong Kong Exchanges & Clearing, the exchange operator, hasn't given a timeline on when the measures could take effect.

"These are the proposals that are necessary in order to make Hong Kong more competitive," Katherine Ng, head of listings at HKEX, said at a press briefing.

While it is too early to say which sectors will benefit from these changes, "the ultimate objective is to improve the diversity of companies that come to list in Hong Kong," both geographically and sectorally, Ng said.

The reforms come as Hong Kong's IPO market is back on track after years of lackluster activity. The city reclaimed its crown in 2025, with funds raised from listings more than tripling to HK$286.9 billion, HKEX data showed.

Under the proposal, the definition of innovative companies will be expanded, making nontech companies with a new business model eligible.

Additionally, the option to file confidentially will be extended to all companies, a move that "would mean fair and equal treatment to all listing applicants," Ng said. "We would no longer favor a minority with certain characteristics."

While there have been concerns recently about market misconduct by companies, HKEX hasn't seen any material differences in the quality of documents that have been submitted confidentially over the years, she said.

"We want to reiterate that the exchange will still consider the whole WVR structure holistically," said Kelly Lee, a senior vice president in the listing division. "In the case of material noncompliance...the exchange will retain the discretion to reject the listing application."

For companies considering a secondary listing in Hong Kong, the market capitalization threshold will be reduced to HK$6 billion from HK$10 billion for certain companies, the exchange said.

It also proposed easing financial reporting standards, allowing companies using U.S. GAAP standards to list in the city.

"Our proposals are consistent with the policy direction of the HKSAR government and market feedback," the exchange said. "They seek to optimize the WVR listing regime, enhance the pathway to listing for homecoming Greater China issuers, among other improvements to listing requirements."

Write to Jiahui Huang at jiahui.huang@wsj.com and Kimberley Kao at kimberley.kao@wsj.com

(END) Dow Jones Newswires

March 13, 2026 07:15 ET (11:15 GMT)