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China issues new IPO guidelines to quicken approvals

China's securities regulator issued new guidelines on IPO applications meant to speed up approvals, clarifying the deadline by which applications must respond to regulatory queries and listing eight situations in which an IPO vetting process would be suspended.

IPO applicants and sponsors should respond to queries within one month, and any necessary extensions should not go past two months, the China Securities Regulatory Commission, or CSRC, said.

The IPO vetting process will also be suspended if when IPO applicants, shareholders or sponsors are under investigation over irregularities. If applicants issue other types of securities that are in conflict with their IPO application, vetting will also be suspended, the CSRC said.

The regulator said it expects the new guidelines, which were published in a question-and-answer format, to speed up IPO approvals while still controlling the quality of listed companies. It added that China is attempting to help companies deleverage through higher direct financing.

CSRC has approved 359 IPOs this year as of October, already beating the annual record of 347 set in 2010. It has also rejected 29% of all applications in the 10-month period, Reuters reported, citing the regulator's data.