(Yicai Global) Feb. 20 -- China has implemented the registration-based initial public offering system across all mainland stock exchanges, according to the country’s securities watchdog.

The Shanghai and Shenzhen stock exchanges will take over existing IPO applications from the China Securities Regulatory Commission and complete the review process from today to March 3, the CSRC announced on Feb. 17. From March 4, Chinese mainland bourses will directly accept new applications for listings on the main boards.

China piloted the registration-based IPO system on Shanghai’s Nasdaq-like Star Market in 2019, and a year later Shenzhen’s ChiNext growth enterprise board also embraced the new system. The Beijing Stock Exchange, established in 2021, adopted it too.

The CSRC will hand the Shanghai and Shenzhen bourses the IPO reviewing power but will still participate in the process, judging whether the applicants comply with industry-related policies, an investment banking insider told Yicai Global.

Under the new regime, the possibility that firms’ IPO applications are rejected will be significantly less compared with the previous approval-based system, the insider added.

Mainland bourses have optimized and adjusted a series of mechanisms relevant to the new share issuance system. The Shenzhen bourse said that as yet unprofitable firms will be allowed to list on the ChiNext board if their market capitalization is predicted to be at least CNY5 billion (USD728 million) and their prior year’s revenue was no less than CNY300 million (USD43.7 million).

Previously, only the Star Market and the Beijing Stock Exchange allowed non-profitable companies to go public.

Editors: Dou Shicong, Futura Costaglione