China Securities Regulatory Commission, Contents and Formats for Information Disclosures by Companies that Offer Securities to the Public Guidelines (No. 17): Takeover by Offer Report

Issued: November 28 2002
Effective: December 1 2002
Interpreting authority: China Securities Regulatory Commission
Applicability: The Guidelines do not apply to takeovers and changes of shareholdings of listed companies that were completed or that have occurred but whose registration of the change in share ownership has not been completed before December 1 2002.

Main contents: A purchaser who increases its shareholding in a target listed company through a takeover offer is required to prepare and disclose a Takeover by Offer Report in accordance with the Procedures (Article 2). The report shall disclose the basic information of the purchaser, the takeover offer, the purchaser's shareholding in the target company and the trading of the shares in the target company during the last six months, source of funds for the takeover, any action to be taken in relation to the target company following the takeover by offer, major transactions between the purchaser and the target company, reports by professional institutions, financial information of the purchaser (in the case of a legal person or other organization), documents for inspection and other major matters (Part Two). A summary of the report shall be placed in a prominent position in the report that shall contain the details of the purchaser and its shareholding in the target company and the concluding opinions of professional institutions (Part Three). Where the purchaser instructs its legal advisor to prepare the report, the legal advisor shall conduct a due diligence verification on the report and the related documents, issue a legal opinion in relation thereto and assume the corresponding legal liability (Article 13). Professional institutions whose reports or opinions are quoted in the report shall give their consent to such quotation in writing (Article 14).
Related legislation: PRC Securities Law (Amended), Oct 27 2005, CLP 2006 No.1 p31 and Administration of the Takeover of Listed Companies Procedures, Sep 28 2002, CLP 2002 No.9 p43