Regulator Unlocks Unlisted Shares of Hong Kong-Listed Mainland Firms

China’s securities regulator has allowed Chinese mainland companies listed in Hong Kong to convert their unlisted holdings into shares that can be freely bought and sold on the city’s stock exchange.

The change — which only applies to companies incorporated on the mainland and listed in Hong Kong, but not on the mainland — allows for the bulk of such shares to be traded in the city for the first time, boosting their liquidity in the market, making it easier for mainland companies’ shareholders to raise funds, and perhaps improving their corporate governance.