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Investing.com-- Nasdaq Inc (NASDAQ:NDAQ) on Wednesday said it was planning to revise its standards for listing public companies, including at least $25 million in public offering proceeds for new listings of companies operating mainly in China.
The exchange operator announced a $15 million minimum market value requirement to remain listed on its exchanges, stating that the new standards were largely aimed at protecting investors and maintaining market integrity.
Nasdaq also outlined an accelerated process for suspending and delisting companies with a market value of below $5 million.
“By increasing our standards for the minimum public float and the public offering raise in certain new listings, it provides a healthier liquidity profile for public investors, while still making emerging companies available to investors through our exchange,” John Zecca, Executive Vice President and Global Chief Legal, Risk & Regulatory Officer at Nasdaq said in a statement.
Nasdaq said the updated standards follow a review of trading activity, especially of “emerging patterns associated with potential pump-and-dump schemes in U.S. cross-market trading environments.”
The exchange operator said it had submitted the proposed changes to the Securities and Exchange Commission for review and approval.
Nasdaq’s $25 million liquidity requirement for Chinese companies is in line with requirements outlined by the exchange operator in 2020, where it had proposed rules for listings from “restrictive markets,” specifically China, that outlined the $25 million liquidity requirement.
But a 2022 agreement between Chinese and U.S. authorities, that granted U.S. auditors access to Chinese firms, had somewhat nixed this liquidity requirement.
Nasdaq’s latest proposal re-establishes its higher liquidity requirements for Chinese firms.