REFORMIST: HK, China spat over tech IPOs turns toxic

Xiaomi, issuers and mainland investors have been caught in the cross-fire between bourses. While the prize of hosting China’s tech unicorns is worth fighting for, exchanges should not lose sight of who they ultimately serve: investors.

The battle between exchanges to host China’s new economy companies has hit a new level of intensity the collateral damage is also piling up.

Shanghai and Shenzhen stock exchanges issued a surprise announcement on July 14 that they would block mainland China investors from buying companies with weighted voting right structures WVR via a mutual market access scheme dubbed Stock Connect.

Hong Kong stock exchange’s chief executive Charles Li flew to mainland China to have a word with his peers.

The result was a fudge. WVR companies will initially be monitored for an indefinite period after which they may be eligible for trading on...

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