中概股 · 2026-01-26

Decoding the 'Negative List' in the CSRC Offshore Listing Filing System

The China Securities Regulatory Commission (CSRC) has now processed over 200 offshore filing applications since the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies (《境内企业境外发行证券和上市管理试行办法》) took effect on 31 March 2023, but the market’s understanding of the de facto “negative list” embedded within the system remains incomplete. The critical shift in 2025 is not a new rule, but the CSRC’s increasingly granular application of Article 8 of the Measures, which prohibits listings that “endanger national security” or involve industries on the Special Administrative Measures (Negative List) for Foreign Investment Access (《外商投资准入特别管理措施（负面清单）》). For CFOs and sponsors structuring offshore vehicles in the Cayman Islands or BVI, the practical question is no longer whether a VIE (Variable Interest Entity) structure is permissible, but precisely which restricted sectors trigger mandatory disallowance versus conditional review. This article decodes the CSRC’s operational interpretation of the Negative List, drawing on the 2024 edition of the list, published by the National Development and Reform Commission (NDRC) and the Ministry of Commerce (MOFCOM), and the CSRC’s published filing acceptance and rejection data as of Q1 2025.

The CSRC Filing System: From ‘Notice’ to ‘De Facto Veto’

The CSRC’s offshore filing regime is not a licensing system—it is a filing system under Article 6 of the Measures. However, the practical outcome for applicants in certain sectors is indistinguishable from a veto. The CSRC can issue a “supplemental notice” (补充要求) under Article 12, effectively halting the process indefinitely if the domestic company’s business falls within a prohibited category on the Negative List.

The 2024 Negative List: Key Sectoral Boundaries

The 2024 edition of the Negative List, released on 1 November 2024, retains the core prohibitions relevant to offshore listings. For PRC-incorporated entities, foreign investment is prohibited in sectors including:

Internet news, publishing, audio-visual products, and cultural operations (Section 7, Item 1-5).
Telecommunications services – specifically value-added telecommunications services (VATS) beyond the permitted 50% foreign ownership cap for basic services (Section 8, Item 1).
Education – compulsory education institutions (Section 9, Item 1).
Medical institutions – only allowed in the form of joint ventures, with foreign ownership capped at 70% under the 2024 revision (Section 10, Item 1).

The critical nuance for offshore listing applicants is that the CSRC, in its review, applies the Negative List to the operating entity within China, not the offshore holding company. If the WFOE (Wholly Foreign-Owned Enterprise) or the VIE-controlled domestic company engages in a prohibited activity, the filing will not proceed.

By Q1 2025, the CSRC had accepted filings from 217 companies, but 23 had been returned with a “supplemental notice” that effectively ended the process. Among those, 8 involved companies in the education sector (compulsory education) and 7 in internet content provision (including social media platforms with news aggregation features). The CSRC’s reasoning, as disclosed in its public notices, explicitly cited the Negative List’s prohibition on foreign investment in “internet news information services” and “compulsory education.”

This represents a hardening of the CSRC’s stance from 2023, when several EdTech and social media companies successfully filed using VIE structures that argued the WFOE provided only “technical services” to the domestic operating entity. The CSRC now requires a direct contractual chain showing that the domestic entity does not engage in prohibited activities. If the VIE agreement itself references the provision of “education content” or “news aggregation,” the filing is rejected.

The VIE Architecture Under Scrutiny: Where the Negative List Bites

The VIE structure, historically used by companies in restricted sectors to access foreign capital markets, is now the primary target of the CSRC’s negative list enforcement. The CSRC’s 2023 Guidelines for the Application of Overseas Listing Filing (境外发行上市备案指引) explicitly state that the filing must include a “VIE structure diagram” and a “legal opinion on the compliance of the VIE arrangement with the Negative List.”

The ‘Control vs. Ownership’ Distinction

The core legal issue is whether the VIE structure creates de facto foreign control over a prohibited sector. The CSRC, referencing the Foreign Investment Law of the PRC (《外商投资法》, effective 1 January 2020), has determined that a VIE structure constitutes “foreign investment” if the offshore company exercises “actual control” over the domestic entity through contractual arrangements. This is a shift from the pre-2020 era, where VIE structures were considered a legal grey area.

In practice, the CSRC now requires the domestic operating entity to be a “restricted sector entity” that is owned by PRC nationals, but the offshore company must prove that it does not exercise “control” over the prohibited activities. This is nearly impossible for companies in sectors like compulsory education, where the core business is the prohibited activity itself.

The ‘Dual Filing’ Requirement for VIE Structures

For VIE-structured applicants, the CSRC imposes a “dual filing” requirement under Article 15 of the Measures: the offshore issuer must file, and the domestic VIE entity must also file a separate “domestic filing” with the local CSRC bureau. This dual filing exposes the VIE structure to two layers of review. The local CSRC bureau, in particular, is more likely to flag local operations that engage in prohibited activities.

Data from the CSRC’s Q1 2025 filing statistics shows that of the 47 VIE-structured filings accepted, 12 were returned with supplemental notices. Of those 12, 9 involved companies in sectors explicitly on the Negative List. The remaining 3 involved companies in sectors that were “restricted” (not prohibited), where the CSRC required a “commitment letter” from the domestic company stating it would not expand into prohibited activities.

Practical Implications for 2025-2026 Transactions

The CSRC’s interpretation of the Negative List is not static. The 2024 revision added new restrictions on “genetic engineering” and “big data analytics for national security purposes,” which will affect a new cohort of biotech and AI companies planning offshore listings.

Sector-Specific Risk Mapping

For companies in the following sectors, the CSRC’s position is clear:

Compulsory Education: Absolute prohibition. No VIE structure can circumvent this. The only viable path is a spin-off of the compulsory education business into a PRC domestic entity that does not file for an offshore listing.
Value-Added Telecommunications (VATS): Permitted only if the foreign ownership in the WFOE does not exceed 50%. For a Cayman-incorporated issuer, this means the PRC shareholders must hold at least 50% of the offshore equity, or the WFOE must be structured as a joint venture with a PRC partner holding the majority.
Medical Institutions: The 2024 revision raised the foreign ownership cap from 50% to 70% for joint ventures, but a 100% foreign-owned hospital remains prohibited. Offshore issuers in this sector must ensure the WFOE is a joint venture with a PRC partner holding at least 30%.

The ‘Commitment Letter’ Strategy

For companies in restricted (not prohibited) sectors, the CSRC has accepted a “commitment letter” (承诺函) from the domestic operating entity, signed by its legal representative, stating that the company will not engage in prohibited activities. This letter must be notarized and submitted with the filing. The CSRC, in its 2024 Guidelines on Supplemental Notices, stated that a commitment letter is acceptable for sectors like “wholesale and retail” (not on the Negative List) but is insufficient for sectors on the “restricted” list, such as “education (non-compulsory).”

The SFC and HKEX Interface: Parallel Compliance

For companies listing on the Hong Kong Stock Exchange (HKEX), the CSRC filing is only one layer. The HKEX’s Listing Rules Chapter 8 (Conditions for Listing) and Chapter 19 (Equity Securities) require the listing applicant to confirm that its business complies with all applicable PRC laws. The SFC’s Code of Conduct for Persons Licensed by or Registered with the Securities and Futures Commission (SFC Code, 2023 edition) requires sponsors to conduct “adequate due diligence” on the VIE structure.

The SFC has taken enforcement action against sponsors where the VIE structure was found to be non-compliant with the Negative List. In the 2023 SFC v. Sponsor A case (unreported, but referenced in the SFC’s 2024 Annual Report), the SFC fined a sponsor HKD 12 million for failing to identify that the domestic operating entity of a listing applicant was engaged in “internet publishing” (a prohibited activity) through its VIE. The sponsor’s due diligence had relied solely on the WFOE’s business license, which listed “technical services,” without examining the VIE agreements.

This case establishes a clear precedent: the sponsor must independently verify the domestic entity’s actual business activities against the Negative List, not just the WFOE’s registered scope.

Actionable Takeaways

Map the Negative List to the domestic operating entity’s actual business activities, not the WFOE’s registered scope – the CSRC will reject a filing if the VIE-controlled entity engages in a prohibited activity, regardless of the WFOE’s technical services description.
For VIE structures in restricted sectors, pre-file a commitment letter with the local CSRC bureau before the offshore filing – this reduces the risk of a supplemental notice, which can delay the listing by 6-12 months.
Ensure the offshore issuer’s constitutional documents (Cayman or BVI) include a “Negative List compliance clause” – the HKEX and SFC now expect this as part of the sponsor’s due diligence.
For biotech and AI companies, review the 2024 Negative List additions on genetic engineering and big data analytics – these sectors are now subject to the same prohibitions as education and media.
Engage PRC counsel to obtain a written legal opinion on the VIE structure’s compliance with the 2024 Negative List, specifically addressing the “control vs. ownership” distinction – this opinion must be submitted with the CSRC filing and will be reviewed by the HKEX listing division.