HONG KONG: HKEX Proposes Amendments to Listing Rules

Friday April 12 2024

On 12^th April 2024, the Stock Exchange of Hong Kong Limited (HKEX) published conclusions to its consultation paper on proposed amendments to Listing Rules Relating to Treasury Shares.

Key changes to the Listing Rules include:

• Remove the requirement to cancel repurchased shares, so that issuers may hold the repurchased shares in treasury subject to the laws of their places of incorporation and their constitutional documents;
• Resale of treasury shares by an issuer to follow the Rules that currently apply to an issue of new shares;
• Maintain fair and orderly market, by mitigating the risk of stock market manipulation and insider dealing, through:
  • Imposing a 30-day moratorium period to restrict
  • (i) a resale of treasury shares after a share repurchase (subject to certain carve-out provisions); and (ii) an on-Exchange share repurchase after an on-Exchange resale of treasury shares; and
  • Prohibiting a resale of treasury shares on the Exchange (i) when there is undisclosed inside information; (ii) during the 30-day period preceding the results announcement; or (iii) if it is knowingly made with a core connected person.

The Exchange will also make housekeeping amendments to the Rules as set out in the Consultation Conclusions. The Rule amendments will come into effect on 11^th June 2024.

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