China's central government relaxes its control over Chinese companies outbund investment in overseas asset by introducing a filing-based system vs. approval-based system. Compared with the old system, which requires approval from the National Development and Reform Commission (NDRC), the Ministry of Commerce (MOFCOM) and the State Administration of Foreign Exchange (SAFE) for any investment above $100mm, under the new policy, a Chinese company only needs to file with NDRC if the transaction is below $1 billion or NDRC's local representation if below $300mm. However, SAFE and its currency control still remains a major hurdle for outbound investment.
For more detail, please visit Schulte Roth & Zabel's report on this subject.
China is going to launch the Third Board in August 2014. The Third Board is similar to the bulletin board in the U.S. Unlike other main boards in China, which accept a limited number of companies each year, the Third Board will accept up to 1000 companies per year, in a hope to help more small enterprises to raise capital. However, the new board has a high bar of RMB 5 million net worth (approximately $800K) for retail investors. The board will include 100 Chinese market makers to create liquidity, and may open to foreign market makers down the road. However, liquidity will remain the biggest concern in the mind of companies that may consider listing on the Board, as well as of the potential retail and institutional investors.