People’s Bank of China and China Securities Regulatory Commission issue measures to support issuance of science and technology innovation bonds

The People’s Bank of China and the China Securities Regulatory Commission jointly published an announcement setting out measures to support the issuance of science and technology innovation bonds, aiming to expand bond-market financing channels for technology innovation. The framework supports issuance by financial institutions, technology-focused enterprises, and private equity and venture capital investment institutions, with eligible instruments including corporate bonds, enterprise bonds and non-financial enterprise debt financing instruments. Issuers are permitted to set bond terms flexibly, with an emphasis on encouraging longer maturities to better match the funding needs of technology innovation. The package also seeks to improve financing convenience through optimised issuance administration, simplified information disclosure, innovation in credit rating approaches and enhanced risk diversification and risk-sharing mechanisms; it further incorporates science and technology innovation bonds into financial institutions’ evaluations of the effectiveness of their technology finance services and encourages local authorities with capacity to provide interest subsidies, guarantees and other support. The two authorities indicated they will continue to完善 the supporting mechanisms to help channel bond market funding to technology innovation more efficiently, conveniently and at lower cost.