InfoQuest (February 13, 2020) -- The office of Securities and Exchange Commission (SEC) will solicit opinions on the issuance of financing regulations for SMEs and startups IPO. The objective is to provide more appropriate financing channels in capital market for SMEs and startups, and take measures to ensure investors access enough reference information to make well-informed investment decisions.
SEC has found that currently SMEs cannot raise fund from ordinary investors, and cannot get listed in securities exchanges. The main reason is that relevant regulations cannot provide convenience and financing cost is too high. Thailand's 20-year national development strategy has set a target of enhancing the proportion of SMEs' GDP to 60 percent by 2037. In order to realize the target and promote financing of SMEs, SEC will open channels to make SMEs and startups capable of raising fund through public offering, while offering investors due protection.
SEC has stipulated that for limited companies, public limited companies, SMEs and startups with proven track record or business scale of a certain level, such as medium-sized enterprises defined by OSMEP and SMEs planning to go public in the Securities Exchange of Thailand, they can go public offering and sell share in secondary market with no need to apply for permit. But they have to submit a list of materials to SEC and prepare a prospectus for investors, to make investors capable of obtaining reference information for investment decision-making, and follow the standards as below:
1. According to regulations, they should release corporate business information and financial statements, and financial statements should be reviewed or audited (data as of February 12, 2020) by auditors affiliated to 29 audit firms whose qualifications have been reviewed by SEC.
2. Investors should have any one of the following features:
(I) Institutional investor, venture capital, joint venture, angel investor.
(2) SMEs, startups, or directors and employees of affiliated companies.
(3) Investors owning professional license for financing and investment.
(4) Ordinary investors owning relevant stock investment knowledge and experience. Investors should have made direct investment over 5 million baht during the past 12 months; stock trading of SMEs and startups should be made through sales conduct intermediaries, as high-risk and complex products do; investors should pass knowledge test to know better about investment risks.
SEC has released a document to collect opinions on the above-mentioned matters at its website (https://www.sec.or.th/EN/Pages/PB_Detail.aspx?SECID=602). Relevant personal or those interested in can submit opinions through the website or email (tayakorn@sec.or.th or jaruwan@sec.or.th or thanidal@sec.or.th) prior to March 13.
Source: InfoQuest, by Saowalak Ouypron / Sasithorn, translated by Xinhua Silk Road
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