The Operational Guidelines for Investors
on the B-to-A-Stock Account Conversion
with regard to the Stock-for-Stock Merger
of Wuxi Little Swan Company Limited
by Midea Group Co., Ltd.
and the Related-Party Transaction
May 2019
Explanation about the Amendments
As per the Reply of the Foshan Central Sub-Branch of the State Administration of
Foreign Exchange on the Foreign Exchange Affairs in Midea Group Co., Ltd.’s
Merger with Wuxi Little Swan Company Limited in a Share Swap via A-share
Offering (F.H.F [2019] No. 1) issued on 22 April 2019, for any Little Swan foreign
investor with A-shares of the Midea Group stock through the share swap who wishes
to remit abroad their A-share dividends and proceeds from the reduction of such
shareholdings in any foreign currency, they shall proceed according to the Notice of
the General Office of the People's Bank of China on the Issues concerning the
Opening and Foreign Exchange Administration of Accounts of Foreign Shareholders
of A-share Listed Companies for Shareholding Reduction and Dividends (Y.B.F [2009]
No. 178).
As per the aforesaid F.H.F [2019] No. 1 Document and the Y.B.F [2009] No. 178
Document, as well as the communications with the foreign exchange administration
and all the other parties concerned, we would like to draw investors’ attention to the
amendments and explanations hereby given with regard to the foreign exchange and
remittance application procedure for any foreign institutional investor as mentioned in
this Operational Guidelines, either trading domestically or overseas, who wishes to
remit abroad their A-share dividends and proceeds from the reduction of such
shareholdings in any foreign currency in the future.
1
Special Notes
The scheme on stock-for-stock merger of Wuxi Little Swan Company Limited
by Midea Group Co., Ltd. through the listing of A-shares and the associated
transactions has been reviewed and approved by the General Meeting of
Shareholders of Midea Group Co., Ltd. and Wuxi Little Swan Company Limited
respectively on 21 December 2018. On 12 March 2019, China Securities
Regulatory Commission issued the Official Reply on Approval of
Stock-for-stock Merger of Wuxi Little Swan Company Limited by Midea Group
Co., Ltd. (Z.J.X.K [2019] No. 352).
After the foreign investors of Little Swan are converted into A-shareholders of
Midea Group, the allocation of the relevant special A-share accounts, the
opening of capital accounts, as well as the foreign exchange and remittance
procedure for dividends and proceeds from shareholding reduction become
complicated. In particular, it will require more materials, as well as a longer
time and procedure for a foreign institutional investor to exchange currencies
and remit the relevant funds abroad. If the foreign institutional investor fails to
provide all the required materials for outward remittance, the remittance may
not be able to be made in time. Therefore, foreign investors are kindly
reminded to pay attention to the relevant risks.
In order to ensure smooth implementation of this stock-for-stock merger and to guide
the securities companies and investors to complete the operation businesses of
account conversion related to the transfer from Little Swan’s B-shares to Midea
Group’s A-shares, the Operational Guidelines have been prepared based on
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communications and discussions among all related parties.
Part of basic procedures concerning this account conversion, such as the withdrawal
registration of B-shares and initial registration of A-shares, will be further defined by
relevant regulatory organizations or executive organizations by issuing documents or
notices. This Operational Guidelines just serve as general description and the specific
operational procedures shall be subject to the documents or notices issued by relevant
regulatory organizations or executive organizations.
This Operational Guidelines are prepared in both Chinese and English. In case of any
discrepancy, the Chinese version shall prevail.
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Contents
Explanation about the Amendments ............................................................................................. 1
Special Notes .................................................................................................................................... 2
Contents ........................................................................................................................................... 4
Part I: Business Notice .................................................................................................................... 7
I. Classification of B-share Investors ............................................................................. 7
II. Classification of Investors of Operational Guidelines............................................. 8
III. Comparison Table of Main Differences between B-shares and A-shares .......... 10
Part II Operational Guidelines for Investors ............................................................................. 12
Chapter I Domestic Individual Investor ............................................................................. 12
Section I Business-related Organizations .................................................................... 14
Section II Determine the Securities Account and Custody Unit of A-shares of Midea
Group ............................................................................................................................. 15
Section III Transfer Registration Restricted Account ............................................... 17
Section IV Trading Cost................................................................................................ 21
Section V Inquiry Business ........................................................................................... 22
Section VI Change of Account Information ............................................................... 23
Section VII General Meeting of Shareholders ............................................................ 24
Section VIII Allotment of Shares ................................................................................. 25
Section IX Cancellation of Transfer Registration Restricted Account .................... 26
Section X Pledge, Freezing and Non-trading Transfer of Account .......................... 27
Chapter II Foreign Individual Investor for Domestic Transactions ................................. 28
Section I Business-related Organizations .................................................................... 30
Section II Determine the Securities Account and Custody Unit of A-shares of Midea
Group ............................................................................................................................. 31
Section III Transfer Registration Restricted Account ............................................... 33
Section IV Trading Cost ............................................................................................... 37
Section V Inquiry Business ........................................................................................... 39
Section VI Change of Account Information ................................................................ 40
Section VII General Meeting of Shareholders ............................................................ 41
Section VIII Allotment of Shares ................................................................................. 42
4
Section IX Cancellation of Transfer Registration Restricted Account .................... 43
Section X Pledge, Freezing and Non-trading Transfer of Account .......................... 44
Chapter III Foreign Institutional Investor for Domestic Transactions ............................ 45
Section I Business-related Organizations .................................................................... 47
Section II Determine the Securities Account and Custody Unit of A-shares of Midea
Group ............................................................................................................................. 48
Section III Transfer Registration Restricted Account ............................................... 50
Section IV Trading Cost ............................................................................................... 56
Section V Inquiry Business ........................................................................................... 58
Section VI Change of Account Information ................................................................ 59
Section VII General Meeting of Shareholders ............................................................ 60
Section VIII Allotment of Shares ................................................................................. 61
Section IX Cancellation of Transfer Registration Restricted Account .................... 62
Section X Pledge, Freezing and Non-trading Transfer of Account .......................... 63
Chapter IV Foreign Individual Investor for Non-domestic Transaction.......................... 64
Section I Business-related Organizations .................................................................... 66
Section II Determine the Securities Account and Custody Unit of A-shares of Midea
Group ............................................................................................................................. 67
Section III Transfer Registration Restricted Account................................................ 69
Section IV Trading Cost................................................................................................ 74
Section V Inquiry Business ........................................................................................... 76
Section VI Change of Account Information ................................................................ 77
Section VII General Meeting of Shareholders ............................................................ 78
Section VIII Allotment of Shares ................................................................................. 79
Section IX Cancellation of Transfer Registration Restricted Account ..................... 80
Section X Pledge, Freezing and Non-trading Transfer of Account ........................... 81
Chapter V Foreign Institutional Investor for Non-domestic Transaction ........................ 82
Section I Business-related Organizations .................................................................... 85
Section II Determine the Securities Account and Custody Unit of A-shares of Midea
Group ............................................................................................................................. 87
Section III Transfer Registration Restricted Account................................................ 89
5
The capitalizing of common reserves, registration of bonus shares and dividend
distribution relating to the shares in the transfer registration restricted account shall be
handled by reference to the existing normal A-share account. ........................................ 96
Section IV Trading Cost................................................................................................ 97
Section V Inquiry Business ........................................................................................... 99
Section VI Change of Account Information .............................................................. 100
Section VII General Meeting of Shareholders .......................................................... 101
Section VIII Allotment of Shares ............................................................................... 102
Section IX Cancellation of Transfer Registration Restricted Account ................... 103
Section X Pledge, Freezing and Non-trading Transfer of Account ......................... 104
Declaration Table for the Corresponding Relationship between the Securities
Account and Custody Unit of A-shares and the Securities Account and Custody Unit
of B-shares ................................................................................................................... 105
Declaration for the Securities Account and Custody Unit of B-share Investors of
Non-domestic Transaction of Little Swan ................................................................. 106
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Part I: Business Notice
As many types of investors are involved in this stock-for-stock merger of Little Swan
by Midea Group and the business operations relating to the account conversion of
different investors vary, in order to guarantee that all types of investors can conduct
transactions smoothly after Little Swan’s B-shares are converted into Midea Group’s
A-shares, we hope that investors can carefully read the following instructions on the
type of investors, confirm which one you fall into and read corresponding part in Part
II “Operational Guidelines for Investors” herein to complete account conversion and
subsequent business operations.
I. Classification of B-share Investors
Investor is classified into domestic investor, foreign individual investor for domestic
transaction, foreign institutional investor for domestic transaction, foreign
individual investor for non-domestic transaction and foreign institutional investor
for non-domestic transaction in accordance with the identity type of the investor,
declaration ways for future transactions, as well as foreign exchange and outbound
remittance paths.
Type of Investor Standard of Classification
The domestic individual investor who opens a B-share securities
Domestic individual
account in domestic securities company and conducts transaction
investor
through the transaction system of domestic securities company.
The foreign individual investor who opens a B-share securities
Foreign individual investor
account in domestic securities company and conducts transaction
for domestic transaction
through the transaction system of domestic securities company.
Foreign institutional The foreign institutional investor who opens a B-share
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investor for domestic securities account in domestic securities company and
transaction conducts transaction through the transaction system of
domestic securities company.
Foreign individual investor The foreign individual investor who opens an independent
for non-domestic B-share securities account in foreign broker and conducts
transaction transaction through the foreign broker.
Foreign institutional
The foreign institutional investor who opens an independent
investor for
B-share securities account in foreign broker and conducts
non-domestic
transaction through the foreign broker.
transaction
II. Classification of Investors of Operational Guidelines
Account conversion procedures and subsequent operations involved in this
stock-for-stock merger of Little Swan by Midea Group are classified and operated in
accordance with the types of investor shown below. After confirming the type of
B-share securities account, investor can understand his/her own type in accordance
with the following standards of classification and accordingly read corresponding
contents of this Guideline to operate this account conversion business:
Corresponding Contents of
Type of Investor Standard of Classification
Operational Guidelines
The domestic individual investor who
opens a B-share securities account in
Domestic individual domestic securities company and Part II “Chapter I Domestic
investor conducts transaction through the Individual Investor”
transaction system of domestic
securities company.
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The foreign individual investor who
opens a B-share securities account in Part II “Chapter II Foreign
Foreign individual
domestic securities company and
investor for domestic Individual Investor for
conducts transaction through the
transaction Domestic Transaction”
transaction system of domestic
securities company.
The foreign institutional investor
who opens a B-share securities
Foreign institutional
account in domestic securities Part II “Chapter III Foreign
investor for
company and conducts Institutional Investor for
domestic
transaction through the Domestic Transaction”
transaction
transaction system of domestic
securities company.
The foreign individual investor who
Foreign individual
Part II “Chapter IV Foreign
opens an independent B-share
investor for
securities account in foreign broker Individual Investor for
non-domestic
and conducts transaction through the Non-domestic Transaction”
transaction
foreign broker.
The foreign institutional investor
Foreign institutional who opens an independent
Part II “Chapter V Foreign
investor for B-share securities account in
Institutional Investor for
non-domestic foreign broker and conducts
Non-domestic Transaction”
transaction transaction through the foreign
broker.
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III. Comparison Table of Main Differences between B-shares and A-shares
Contents of Comparison B-shares A-shares
Monday to Friday, trading Monday to Friday, trading
Trading date suspended on Saturday, suspended on Saturday,
Sunday and national holidays Sunday and national holidays
Market order: The quotation Market order: The quotation
is made at the market price is made at the market price
and the declaration can only and the declaration can only
Way of order quotation be made during continuous be made during continuous
trading hours trading hours
Limit order: The quotation is Limit order: The quotation is
made at a specified price made at a specified price
9:15 to 9:20: Accept the trade 9:15 to 9:20: Accept the trade
declaration and the declaration and the
cancellation cancellation
9:20 to 9:25: Accept the trade 9:20 to 9:25: Accept the trade
The trade declaration is
declaration, but do not accept declaration, but do not accept
processed by the system of
the declaration of cancellation the declaration of cancellation
exchange before opening
9:25 to 9:30: Accept the trade 9:25 to 9:30: Accept the trade
declaration and the declaration and the
declaration of cancellation, declaration of cancellation,
but do not process it but do not process it
9:30 to 11:30 and 13:00 to 9:30 to 11:30 and 13:00 to
Continuous trading hours
14:57 14:57
Stage of closing call auction 14:57 to 15:00 14:57 to 15:00
Minimum declared quantity
of buying for single 100 shares 100 shares
transaction
Quantity sold less than the Zero share, one-off sale Zero share, one-off sale
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minimum declared quantity declared declared
for single transaction
Minimum fluctuating price HKD 0.01 RMB 0.01
Limit of price change 10% 10%
Rotary trading day T+1 day T+1 day
Shares are delivered on the T
Settlement system T+3 day + 0 day, while the fund is
delivered on the T + 1 day
Margin trading None Yes
The above differences are concluded only by making comparison between the
B-shares and A-shares, which are not applicable to the all the investors after Little
Swan’s B-shares are converted into Midea Group’s A-shares. Different business
operations apply to different types of investors. For details, please refer to
corresponding contents in the Part II herein.
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Part II Operational Guidelines for Investors
Chapter I Domestic Individual Investor
In order to guarantee that investors can conduct transactions smoothly after Little
Swan’s B-shares are converted into Midea Group’s A-shares, the domestic individual
investors, to which this Chapter is applicable, shall fully understand and confirm the
matters shown below:
1. With respect to the investor who holds Midea Group’s A-shares as the shares are
not sold on the last trading day of Little Swan’s B-shares and fails to validly declare
the cash option, sale of shares in future will be liquidated by RMB and settled by
RMB finally;
2. With respect to the B-share investor who has not declared an A-share account as at
30 May 2019, CSDC shall allocate one transfer registration restricted account which
only can make the sell order declaration but cannot make the buy order declaration.
Investors shall fully understand the restrictions on trading;
3. It is required that the investor who is allocated the transfer registration restricted
account shall handle formalities relating to third party custody in the securities
company in accordance with the requirements of the A-shares securities at the time of
opening account;
4. Investor shall confirm that he/she is the investor, to which this Chapter is applied,
otherwise, potentially, relevant contents of this Operational Guidelines are not
complete applicable;
5. Investors shall fully understand the differences of trading rules and expenses
between B-shares and A-shares;
6. The stock code of trade declaration of Midea Group’s A-shares is “000333” and
name of securities is “Midea Group”;
7. Investors shall continuously pay attention to relevant announcements issued by
Little Swan and Midea Group and learn the progress of this stock-for-stock merger;
8. Investors may inquire of the securities company where transactions of B-share
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securities account are made about the specific ways of business operation relating to
the account conversion.
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Section I Business-related Organizations
Full name of Abbreviation in this
Main relevant matters
organization Guidelines
Midea Group Co.,
Midea Group Information disclosure
Ltd.
Wuxi Little Swan Little Swan,
Information disclosure
Company Limited Littleswan-B
China Securities
Depository and Allocation of transfer registration restricted
CSDC
Clearing account
Corporation Limited
Shenzhen Stock Restrictions on buy order declaration of
SZSE
Exchange transfer registration restricted account
Handle all business applications of investors
and consultation, communication and notice;
Domestic securities Domestic securities assist investors in opening common A-share
companies companies securities account, A-share securities account
and assist investors to complete the handling
formalities of third party custody meanwhile.
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Section II Determine the Securities Account and Custody Unit of A-shares of
Midea Group
As Littleswan-B investors’ existing B-share accounts cannot be directly converted
into accounts of Midea Group A-shares, and SZSE implements the shares custody
transfer trading system, one investor may have more than one custody units under one
securities account. The securities account and custody unit of A-shares of Midea
Group will be determined in accordance with the principles shown below after stock
conversion:
1. After asking for the advices of investors, the domestic securities company which
serves as the custody unit of Littleswan-B shares shall declare the securities account
and custody unit of A-shares for each investor of Littleswan-B shares before 30 May
2019, which shall ensure investors can normally trade the A-shares of Midea Group.
A-shares of Midea Group will be held in the declared securities account of A-shares
corresponding to the original securities account of B-shares after Littlewan-B shares
are converted into A-shares of Midea Group. A-shares of Midea Group will be held in
custody in the declared custody unit of A-shares corresponding to the original custody
unit of B-shares after Littleswan-B shares are converted into A-shares of Midea Group.
The mistaken declaration information on the securities account and custody unit of
A-share, if any, may result in that investors are unable to normally register or sell
A-share obtained after Littleswan-B shares are converted into A-shares of Midea
Group, please check and ensure the information declared to be correct.
Manners to declare securities account and custody unit: Please complete the
Declaration Table for the Corresponding Relationship between the Securities Account
and Custody Unit of A-shares and the Securities Account and Custody Unit of
B-shares (refer to Appendix 1 for details) and send the following documents to
sndd@citics.com:
1) Copy and paste the completed Declaration Table in the body of the message;
2) Print and seal the completed Declaration Table, and send the scanned copy as an
attachment of the message.
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At the time of declaration, please completely declare the information on the securities
account and custody unit of A-shares corresponding to the securities account and
custody unit of B-shares. In case the information on the corresponding relationship
would be declared for more than one times, the full declaration information which is
received last by our company will prevail.
2. Where the securities account of A-shares fails to be declared before the designated
deadline, A-shares will be transferred to the transfer registration restricted account
designated by CSDC. For details, please refer to “Section III Transfer Registration
Restricted Account” in this chapter. Where the custody unit of A-shares fails to be
declared before the designated deadline, A-shares will be transferred to the custody
unit designated by CITIC Securities, and investor may contact the CITIC Securities
directly to handle custody transfer or make transaction directly.
If there are any questions, please contact Shennan Avenue Business Department of
CITIC Securities Co., Ltd.
Contact information relating to the consultation and business of CITIC Securities:
Contact person: Shennan Avenue Business Department of CITIC Securities Co., Ltd.
Address: Room 301A, Tower A, Xinian Center, No. 6021, Shennan Avenue, Futian
District, Shenzhen
Tel.: 86-0755-83477942 (He Ying)
86-0755-83477944 (Luo Yixi)
86-0755-83477915 (Yang Zheng)
86-0755-83477941 (Shao Qicong)
Fax: 86-0755-83459951
Email: sndd@citics.com
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Section III Transfer Registration Restricted Account
I. Allocation of transfer registration restricted account and third-party depository
business handling
With respect to the domestic individual investor who has not declared an A-share
securities account, Midea Group will apply to CSDC for allocating one transfer
registration restricted account to the aforesaid investor free of any charge in
accordance with the information of B-share securities account. As this securities
account is restricted, only the sell order declaration can be made and other purposes
are forbidden.
During the course to allocate the transfer registration restricted account, investors
need not carry out any extra operation. After the transfer registration restricted
account is allocated, the securities company will notify investors of relevant matters
concerning the allocation of transfer registration restricted account by network,
telephone, text message, announcement in places of business, etc. Business
department of each securities company will assist the investor in opening the transfer
registration restricted account, and investor is required to handle the third-party
depository formalities for the transfer registration restricted account in the business
department of securities account before making subsequent sell order transactions
relating to the transfer registration restricted account.
Investor is required to sign the third-party depository agreement and handle the
third-party depository formalities relating to the fund account in accordance with
relevant regulations concerning third-party depository business of fund account
specified by the securities company. The general handling procedures are that the
securities company sends the pre-designated information relating to the fund account
with RMB settlement function to the third-party depository bank, investor handles
third-party depository formalities of fund account in the business branch of depository
bank and then the third-party deposit of investor’s fund account is achieved. Investor
may inquire of the securities company where transactions of B-share securities
account are made about the specific procedures for business handling and required
17
information.
After the transfer registration restricted account is allocated, investor may inquire of
the securities company which designates the custody unit of A-shares for him/her by
inquiry counter, telephone, online trading system, etc. If there is no custody unit of
A-shares designated for investor, he/she may inquire of CITIC Securities Co., Ltd by
inquiry counter, telephone, online trading system, etc.
II. Way of order
After the listing of A-shares of Midea Group, way of sell order relating to the
investor’s transfer registration restricted account will be declared in the way of order
that investor has applied to the business department of securities company where
transactions of transfer registration restricted account are made to open; where the
online trading order has been opened, investor may login in the online trading system
through the account number and trading password of the transfer registration
restricted account, inquire about the remaining A-shares of Midea Group and fund
balance of transfer registration restricted account and make sell order declaration.
III. Real-time market situation
Investor may obtain the real-time market situation and information of and suspension
and resumption of trading relating to the A-shares of Midea Group through the
existing market situation display channel and way of the securities company where
transactions of transfer registration restricted account are made, such as on-site
self-service terminal of business department, online trading client terminal, etc.
IV Main trading rules
Stock code of sell order declaration of A-shares of Midea Group is “000333” and
name of securities is “Midea Group”. The way of sell order declaration is basically
same as the operation of B-shares.
(I) Limit of change
A-shares shall not increase or decrease by 10% from the closing price of last trading
day within trading hours that day.
Limit of change on ST shares and the shares that split share structure reform has not
been finished is 5%.
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(II) Rotary trading system
The T + 1 rotary trading system is implemented for the A-shares, namely, the shares
brought that day can be sold in the following day. The investor relating to the transfer
registration restricted account is only allowed to make the sell order declaration, so the
rotary trading is not applicable.
(III) Trading unit
The transfer registration restricted account can only make the sell order and the
declared quantity shall be 100 shares or its integral multiple. One-off sale declaration
shall be made for the remaining shares less than 100 shares.
(IV) Minimum fluctuating price
Minimum fluctuating unit of declared price of A-shares is RMB 0.01.
(V) Trading hours
Monday to Friday (excluding the national holidays and day of suspension of trading
stipulated by exchange);
9:15 to 9:25 of each trading day is the stage of opening call auction, wherein:
9:15 a.m. to 9:20 a.m.: Accept the trade declaration and the cancellation
9:20 a.m. to 9:25 a.m.: Accept the trade declaration, but do not accept the declaration
of cancellation
The order that is not made during the call auction will automatically enter into the
continuous auction;
From 9:30 to 11:30 and from 13:00 to 14:57 of each trading day is the time of
continuous auction;
14:57 to 15:00 is the stage of closing call auction.
V. Liquidation and settlement
Same rules are applied in transfer registration restricted account and ordinary A-share
securities account and shares are liquidated and settled on the T + 0 day, which means
that the quantity of shares equal to the quantity of shares sold and concluded that day
(T day) by the investor will be decreased in the securities account that day; the fund is
settled on the T + 1 day, which means that the investor can withdraw the fund
obtained from the sale of shares that day (T day) in the following trading day (T + 1
19
day).
VI. Payment of fund
As the fund account with RMB settlement function has been opened and the
third-party depository formalities have been handled in accordance with the current
account opening requirements relating to the A-share securities account when the
transfer registration restricted account of investors is opened, the investor may
transfer and withdraw the fund obtained from the sale of shares through the
third-party depository bank of A-shares on the T + 1 day.
Investor cannot complete the sell order of A-shares of Midea Group through the
transfer registration restricted account until the transfer registration restricted account
has been opened in the securities company where transactions of transfer registration
restricted account will be made and third-party depository formalities have been
handled, so the investor needs to handle relevant business formalities in the business
department of securities company as early as possible.
VII. Capitalizing of common reserves, bonus shares and dividend distribution
The capitalizing of common reserves, registration of bonus shares and dividend
distribution relating to the shares in the transfer registration restricted account shall be
handled by reference to the existing normal A-share account.
VIII. Differentiated dividend tax
Calculation and withholding of differentiated dividend tax are handled in accordance
with the existing business rules.
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Section IV Trading Cost
Trading cost relating to the investor who has established association relationship
between the subaccount of A-shares and subaccount of B-shares and the investor who
is allocated the transfer registration restricted account is same as the current
transaction cost of ordinary A-share securities account.
Ordinary Ordinary Transfer
Name of Trading B-share A-share Registration
Rate
Cost Securities Securities Restricted
Account Account Account
Commission for Refer to original
domestic transaction
account opening commission of √ √ √
securities A-share or
company B-share
0.1% (only
Stamp tax √ √ √
charge the seller)
0.05% (charged
Liquidation
based on the √
expense
trading amount)
0.0487‰ of the
trading
Handling fee amount(charge √ √ √
the buyer and
seller)
0.02‰ of the
trading
Registration and
amount(charge √ √
transfer fee
the buyer and
seller)
0.02‰ of the
trading
Supervision fee amount(charge √ √ √
the buyer and
seller)
21
Section V Inquiry Business
After Littleswan-B shares are converted into A-shares of Midea Group, the investor
who has established one password association relationship between the subaccount of
A-shares and subaccount of B-shares may inquire about the remaining securities in
the account and balance of fund in the current inquiry way relating to the securities
account in the securities company where transactions of A-share securities account are
made; The investor who is allocated the transfer registration restricted account may
make an inquiry in the current inquiry way relating to the securities account in the
securities company where transactions of transfer registration restricted account are
made.
In addition, all investors may obtain all the disclosed information relating to this
stock-for-stock merger on the website of SZSE (http://www.szse.cn/).
22
Section VI Change of Account Information
The information relating to the transfer registration restricted account is copied from
current information of investor’s B-share securities. The investor whose identity
information is changed is required to contact the securities company promptly, which
is required to promptly handle the information change to the B-share securities
account and transfer registration restricted account to ensure consistency.
23
Section VII General Meeting of Shareholders
Investors may attend the General Meeting of Shareholders and make the voting on the
scene in person or by proxy. With respect to the investors who intends to be present at
the meeting, at the day of General Meeting of Shareholders, individual investors shall
hold stock account card (the investors allocated the transfer registration restricted
account may only hold the original B-share securities account card), personal ID card
or other valid certificates or paper of identification that can prove the identity);
representative of institutional investors shall hold the stock account card (the investors
allocated the transfer registration restricted account may only hold the original
B-share securities account card) and certificate provided by the unit of shareholder
when attending the General Meeting of Shareholders. Agent shall also present the
power of attorney and valid personal ID.
After the custody relationship for the transfer registration restricted account has been
established and third-party depository formalities have been handled, investors may
make the online voting in accordance with the current voting procedures for the
ordinary A-share securities account.
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Section VIII Allotment of Shares
Before foreign residents can subscribe A-shares, or foreign residents sell all A-shares
of Midea Group held by them, Midea Group will take the fact that the part of trading
rights relating to the A-share securities account are restricted with extreme caution
and fully consider fairness of participation right of various investors when handling
relevant matters including allotment of shares.
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Section IX Cancellation of Transfer Registration Restricted Account
When remaining A-shares of Midea Group in the transfer registration restricted
account of an investor is zero, the securities company where transactions of transfer
registration restricted account are made may cancel the transfer registration restricted
account.
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Section X Pledge, Freezing and Non-trading Transfer of Account
1. Pledge, non-trading transfer business: are handled in accordance with relevant
business rules of CSDC.
2. Judicial business: is implemented with assistance provided by each securities
company and CSDC.
27
Chapter II Foreign Individual Investor for Domestic Transactions
In order to guarantee that investors can conduct transactions smoothly after B-shares of
Little Swan are converted into A-shares of Midea Group, the foreign individual
investors for domestic transactions, to which this Chapter is applicable, shall fully
understand and confirm the matters shown below:
1. With respect to the investor who holds the A-shares of Midea Group as the shares are
not sold on the last trading day of Little Swan B-shares and fails to validly declare the
cash option, sale of shares in future will be liquidated by RMB and settled by HKD
finally by each securities company after purchasing foreign exchange through the
foreign exchange purchase bank, and the exchange rate when purchasing foreign
exchange uses the selling price of spot exchange of RMB to HKD on the day when the
foreign exchange purchase bank purchasing foreign exchange;
2. With respect to the foreign individual investors for domestic transactions, to which
this chapter is applicable, “Section II Determine the Securities Account and Custody
Unit of A-shares of Midea Group” of this chapter can be referred to for declaring an
available A-share account (if any). If there is no A-shares account or no declaration,
Midea Group shall apply to CSDC to allocate one transfer registration restricted
account which only can be used to make the sell order declaration and shall not be
used for other purposes. Relevant investors shall fully understand the restrictions on
trading;
3. Investor shall confirm that he/she is the investor, to which this Chapter is applied,
otherwise, potentially, relevant contents of this Operational Guidelines are not
complete applicable;
4. Investors shall fully understand the differences of trading rules and expenses
between B-shares and A-shares;
5. The stock code of trade declaration of A-shares of Midea Group is 000333 and name
of securities is “Midea Group”;
6. Investors shall continuously pay attention to relevant announcements issued by Little
Swan and Midea Group and learn the progress of this stock-for-stock merger;
28
7. Investors may inquire of the securities company where transactions of B-shares
securities account are made about the specific ways of business operation relating to
the account conversion.
29
Section I Business-related Organizations
Full name of Abbreviation in this
Main relevant matters
organization Guidelines
Midea Group Co.,
Midea Group Information disclosure
Ltd.
Wuxi Little Swan Little Swan,
Information disclosure
Company Limited Littleswan-B
China Securities
Depository and Allocation of transfer registration restricted
CSDC
Clearing account
Corporation Limited
Shenzhen Stock Restrictions on buy order declaration of
SZSE
Exchange transfer registration restricted account
Handle all business applications of investors
and consultation, communication and notice;
Domestic securities Domestic securities assist investors in opening transfer registration
companies companies restricted account and assist investors to
complete the handling formalities of third
party custody meanwhile
30
Section II Determine the Securities Account and Custody Unit of A-shares of
Midea Group
As the current securities accounts of B-shares held by investors of B-shares of Little
Swan cannot be used to directly register A-shares of Midea Group and SZSE
implements the shares custody transfer trading system, one investor may have more
than one custody unit under one securities account. The securities account and custody
unit of A-shares of Midea Group will be determined in accordance with the principles
shown below after stock conversion:
1. After asking for the advices of investors, the domestic securities company where
transactions of B-shares of Little Swan are conducted shall declare the securities
account and custody unit of A-shares for each investor of Little Swan B-shares before
30 May 2019, which shall ensure investors can normally trade the A-shares of Midea
Group.
The B-shares of Little Swan registered in original securities account of B-shares will
be registered in the declared securities account of A-shares after converted into
A-shares of Midea Group. The B-shares of Little Swan will be trusted in the declared
custody unit of A-shares after the conversion. The mistaken declaration information on
the custody unit of A-shares, if any, may result in that investors are unable to normally
register or sell A-shares obtained after Little Swan B-shares are converted into
A-shares of Midea Group, please check and ensure the information declared is correct.
Manners to declare securities account and custody unit: Please complete the
Declaration Table for the Corresponding Relationship between the Securities Account
and Custody Unit of A-shares and those of B-shares (refer to Appendix 1 for details)
and send the following documents to sndd@citics.com:
1) Copy and paste the completed Declaration Table in the body of the message;
2) Print and seal the completed Declaration Table, and send the scanned copy as an
attachment of the message.
At the time of declaration, please completely declare the information on the securities
account and custody unit of A-shares corresponding to those of B-shares. In case the
31
information on the corresponding relationship would be declared for more than one
times, the full declaration information which is received last by our company will
prevail.
2. Where the securities account of A-shares fails to be declared before the designated
deadline, A-shares after conversion will be registered to the transfer registration
restricted account of related investors opened by CSDC, please refer to “Section III
Transfer Registration Restricted Account” of this chapter. Where the custody unit of
A-shares fails to be declared before the designated deadline, A-shares after conversion
will be transferred to the custody unit designated by CITIC Securities, and investor may
contact the CITIC Securities directly to handle custody transfer or make transaction
directly.
If there are any questions, please contact Shennan Avenue Business Department of
CITIC Securities Co., Ltd.
Contact information relating to the consultation and business of CITIC Securities:
Contact person: Shennan Avenue Business Department of CITIC Securities Co., Ltd.
Address: 301A, Building A, Xinian Center, No. 6021, Shennan Avenue, Futian District,
Shenzhen
Tel.: 86-0755-83477942 (He Ying)
86-0755-83477944 (Luo Yixi)
86-0755-83477915 (Yang Zheng)
86-0755-83477941 (Shao Qicong)
Fax: 86-0755-83459951
Email: sndd@citics.com
32
Section III Transfer Registration Restricted Account
I. Allocation of Transfer Registration Restricted Account
After completing the business of cash option of B-shares of Little Swan, with respect
to the foreign individual investor for domestic transactions without or not declaring
securities account of A-shares, Midea Group will apply to CSDC for allocating one
transfer registration restricted account to the aforesaid free of any charge in accordance
with the information of B-shares securities account. As this securities account is
specially restricted, only the sell order declaration can be made and other purposes are
forbidden.
The securities company will notify investors of relevant matters concerning the
allocation of transfer registration restricted account by network, telephone, text
message, announcement in places of business, etc. Business department of each
securities company will assist the investor in opening the function of settlement by
RMB for original capital account of B-shares before making subsequent sell order
transactions relating to the transfer registration restricted account.
During the course to allocate the transfer registration restricted account, investors need
not carry out any extra operation. Before the listing of additional A-shares of Midea
Group on the stock market, securities company where the securities account of
B-shares of investors belongs will notify investors of relevant matters concerning the
allocation of transfer registration restricted account by network, telephone, text
message, announcement in places of business. Please be aware of the relevant notices
and announcements on the occasion.
After the transfer registration restricted account is allocated, investors can inquire of
the designated security company of A-shares custody unit via consultancy at counter,
telephone, online transaction system, etc. If no custody unit of A-shares is designated,
investors can inquire of CITIC Securities via consultancy at counter, telephone, online
transaction system, etc.
II. Way of Order
After the listing of A-shares of Midea Group, way of sell order relating to the investor’s
33
transfer registration restricted account will be declared in the way of order that investor
has applied to the business department of securities company where transactions of
transfer registration restricted account are made to open; where the online trading order
has been opened, investor may login in the online trading system through the account
number and trading password of the transfer registration restricted account, inquire
about the remaining A-shares of Midea Group and fund balance of transfer registration
restricted account and make sell order declaration.
III. Real-time Market Situation
Investor may obtain the real-time market situation and information on suspension and
resumption of trading relating to the A-shares of Midea Group through the existing
market situation display channel and way of the securities company where transactions
of transfer registration restricted account are made, such as on-site self-service terminal
of business department, online trading client terminal, etc.
IV Main Trading Rules
Stock code of sell order declaration of A-shares of Midea Group is “000333” and name
of securities is “Midea Group”. The way of sell order declaration is basically same as
the operation of B-shares.
(I) Limit of Change
A-shares shall not increase or decrease by 10% from the closing price of last trading
day within trading hours of that day.
Limit of change on ST shares and the shares that split share structure reform has not
been finished is 5%.
(II) Rotary Trading System
The T + 1 rotary trading system is implemented for the A-shares, namely, the shares
brought that day can be sold in the following day. The investor relating to the transfer
registration restricted account is only allowed to make the sell order declaration, so the
rotary trading is not applicable.
(III) Trading Unit
For A-share bought via bidding mode, the declared quantity shall be 100 shares or its
integral multiple. One-off sale declaration shall be made for the remaining shares less
34
than 100 shares.
(IV) Minimum Fluctuating Price
Minimum fluctuating unit of declared price of A-shares is RMB0.01.
(V) Trading Hours
Monday to Friday (excluding the national holidays and day of suspension of trading
stipulated by exchange);
9:15 to 9:25 of each trading day is the stage of opening call auction, wherein:
9:15 a.m. to 9:20 a.m.: Accept the trade declaration and the cancellation
9:20 a.m. to 9:25 a.m.: Accept the trade declaration, but do not accept the declaration of
cancellation
The order that is not made during the call auction will automatically enter into the
continuous auction;
From 9:30 to 11:30 and from 13:00 to 14:57 of each trading day is the time of
continuous auction;
14:57 to 15:00 is the stage of closing call auction
V. Liquidation and Settlement
Same rules are applied in transfer registration restricted account and ordinary A-shares
securities account and shares are liquidated and settled on the T + 0 day, which means
that the quantity of shares equal to the quantity of shares sold and concluded that day (T
day) by the investor will be decreased in the securities account that day; the RMB fund
is settled on the T + 1 day, which means that the investor can withdraw the RMB fund
obtained from the sale of shares that day (T day) in the following trading day (T + 1
day).
With respect to the foreign individual investors for domestic transactions, to which
this Chapter is applicable, the RMB fund obtained from sale of shares cannot be used,
withdrawn and required to be converted into HKD in accordance with requirements of
State Administration of Foreign Exchange, namely, the securities company converts
the RMB fund into HKD and make the settlement. Therefore, the RMB fund obtained
from sale of shares of investor’s transfer registration restricted account will be settled
on the T + 1 day; the HKD fund that can be withdrawn finally will be settled on the
35
T+3 day after foreign exchange purchase bank has purchased foreign exchange, which
means the investor may apply to the securities company to withdraw the HKD
obtained from sale of shares on the T + 3 day. Investor may inquire of the securities
company where transactions of transfer registration account are made about the
specific ways of details.
VI. Payment of Fund
Investor may send withdrawal application to the securities company on and following
T + 3 day. The withdrawal application procedures are same as the current withdrawal
procedures of investor’s B-shares. After withdrawal application procedures pass the
internal audit of the securities company, the securities company transfer the net
amount of HKD fund that investor applies for withdrawal to the investor after
deducting charges for remittance.
Before the investor makes the withdrawal application, the interest accrued when HKD
fund is deposited in each domestic securities company and current interest of HKD
within the same period will be settled with the investor and included in the fund
account of investor accordingly on the value date.
VII. Capitalizing of Common Reserves, Bonus Shares and Dividend Distribution
The capitalizing of common reserves, registration of bonus shares and dividend
distribution relating to the shares in the transfer registration restricted account shall be
handled by reference to the existing normal A-shares account.
36
Section IV Trading Cost
The foreign investor who opens the transfer registration restricted account is required
to pay commission, stamp tax, etc. same as the current ordinary A-shares securities
account and the foreign exchange purchase expenses of RMB to HKD and charges for
remittance of HKD. Currently, the foreign exchange purchase of HKD involves no
additional expenses and the exchange rate when purchasing foreign exchange uses the
selling price of spot exchange of RMB to HKD on the day when the foreign exchange
purchase bank purchasing foreign exchange. Charges for remittance of HKD are
subject to the charges of the foreign exchange purchase bank.
Ordinary Ordinary Transfer
Name of B-share A-share Registration
Rate
Trading Cost Securities Securities Restricted
Account Account Account
Commission
for Refer to
original
domestic
transaction
account √ √ √
commission
opening
of A-share or
securities
B-share
company
0.1% (only
Stamp tax charge the √ √ √
seller)
0.05% (charged
Liquidation based on
√
expense the trading
amount)
It is handled in
accordance with
the selling price
of spot
Foreign exchange
exchange
of RMB to
purchase
HKD when the
expense
foreign
of HKD
exchange bank
purchasing of
foreign
exchange.
Charges for Charges for √
37
remittance of remittance of
HKD
HKD
are subject to
the charges of
the
foreign
exchange
purchase bank.
0.0487‰ of the
trading
Handling fee amount(charge √ √ √
the buyer
and seller)
0.02‰ of the
Registration trading
and amount(charge √ √
transfer fee the buyer
and seller)
0.02‰ of the
trading
Supervision fee amount(charge √ √ √
the buyer
and seller)
38
Section V Inquiry Business
After Little Swan B-shares are converted into A-shares of Midea Group, the investors
may inquire about the remaining securities in the account and balance of fund in the
current inquiry way relating to the securities account in the securities company where
transactions of transfer registration restricted account are made.
In addition, all investors may obtain all the disclosed information relating to this
stock-for-stock conversion from the website of SZSE (http://www.szse.cn/).
39
Section VI Change of Account Information
The information relating to the transfer registration restricted account is copied from
current information of investor’s B-shares securities. The investor whose identity
information is changed is required to contact the securities company promptly, which
is required to promptly handle the information change to the B-shares securities
account and transfer registration restricted account to ensure consistency.
40
Section VII General Meeting of Shareholders
Investors may attend the General Meeting of Shareholders and make the voting on the
scene in person or by proxy. With respect to the investor who intends to be present at
the meeting, at the day of General Meeting of Shareholders, individual investors shall
hold stock account card (the investors allocated the transfer registration restricted
account may only hold the original B-shares securities account card), personal ID card
or other valid certificates or paper of identification that can prove the identity);
representative of institutional investors shall hold the stock account card (the investors
allocated the transfer registration restricted account may only hold the original
B-shares securities account card) and certificate provided by the unit of shareholder
when attending the General Meeting of Shareholders. Agent shall also present the
power of attorney and valid personal ID.
After the custody relationship for the transfer registration restricted account has been
established, investors may make the online voting in accordance with the current
voting procedures for the ordinary A-shares securities account.
41
Section VIII Allotment of Shares
Before foreign residents can subscribe A-shares, or foreign residents sell all A-shares
of Midea Group held by them, Midea Group will take the fact that the part of trading
rights relating to the A-shares securities account are restricted with extreme caution
and fully consider fairness of participation right of various investors when handling
relevant matters including allotment of shares.
42
Section IX Cancellation of Transfer Registration Restricted Account
When remaining A-shares of Midea Group in the transfer registration restricted
account of an investor is zero, the securities company where transactions of transfer
registration restricted account are made may cancel the transfer registration restricted
account.
43
Section X Pledge, Freezing and Non-trading Transfer of Account
1. Pledge, non-trading transfer business: are handled in accordance with relevant
business rules of CSDC.
2. Judicial business: is implemented with assistance provided by each securities
company and CSDC.
44
Chapter III Foreign Institutional Investor for Domestic Transactions
In order to guarantee that investors can conduct transactions smoothly after B-shares of
Little Swan are converted into A-shares of Midea Group, the foreign institutional
investors for domestic transactions, to which this Chapter is applicable, shall fully
understand and confirm the matters shown below:
1. With respect to any investor who holds the A-shares of Midea Group as the
Little Swan B-shares are not sold on the last trading day and fails to validly
declare the cash option, sale of shares in future will be settled in RMB. After
the completion of this stock-for-stock merger, with respect to any foreign
institutional investor for domestic transactions who formerly holds B-shares of
Little Swan, the reduction of A-shares of Midea Group and obtaining of
dividends in Reminbi through his/her transfer registration restricted account
shall be pursuant to the Notice on Opening of Accounts Involved in Share
Reduction by and Dividends Attributable to Foreign Shareholders of A-share
Listed Companies and on Matters Related to Foreign Exchange Control
Issued by the General Office of the People’s Bank of China (Y.B.F [2009] No.
178) and relevant provisions of the foreign exchange control.
2. With respect to the foreign institutional investors for domestic transactions, to
which this chapter is applicable, “Section II Determine the Securities Account and
Custody Unit of A-shares of Midea Group” of this chapter can be referred to for
declaring an available A-share account (if any). If there is no A-shares account or no
declaration, Midea Group shall apply to CSDC to allocate one transfer registration
restricted account which only can be used to make the sell order declaration and shall
not be used for other purposes. Relevant investors shall fully understand the
restrictions on trading;
45
3. Investor shall confirm that he/she is the investor, to which this Chapter is applied,
otherwise, potentially, relevant contents of this Operational Guidelines are not
complete applicable;
4. Investors shall fully understand the differences of trading rules and expenses
between B-shares and A-shares;
5. The stock code of trade declaration of A-shares of Midea Group is 000333 and name
of securities is “Midea Group”;
6. Investors shall continuously pay attention to relevant announcements issued by Little
Swan and Midea Group and learn the progress of this stock-for-stock merger;
7. Investors may inquire of the securities company where transactions of B-shares
securities account are made about the specific ways of business operation relating to
the account conversion.
8. Foreign institutional investors may inquire Foshan Branch of China
Merchants Bank about how to open an NRA account and exchange
currencies.
46
Section I Business-related Organizations
Full name of Abbreviation in this
Main relevant matters
organization Guidelines
Midea Group Co.,
Midea Group Information disclosure
Ltd.
Wuxi Little Swan Little Swan,
Information disclosure
Company Limited Littleswan-B
China Securities
Depository and Allocation of transfer registration restricted
CSDC
Clearing account
Corporation Limited
Shenzhen Stock Restrictions on buy order declaration of
SZSE
Exchange transfer registration restricted account
Handle all business applications of investors
and consultation, communication and notice;
Domestic securities Domestic securities assist investors in opening transfer registration
companies companies restricted account and assist investors to
complete the handling formalities of third
party custody meanwhile
Handle applications of foreign institutional
investors regarding to opening of NRA,
provide services related to currency
Foshan Branch of
Foshan Branch of exchange such as consultation,
China Merchants
CMBC communication and notice and assist
Bank
investors to exchange currencies and
remit funds as required by relevant foreign
exchange regulations.
47
Section II Determine the Securities Account and Custody Unit of A-shares of
Midea Group
As the current securities accounts of B-shares held by investors of B-shares of Little
Swan cannot be used to directly register A-shares of Midea Group and SZSE
implements the shares custody transfer trading system, one investor may have more
than one custody unit under one securities account. The securities account and custody
unit of A-shares of Midea Group will be determined in accordance with the principles
shown below after stock conversion:
1. After asking for the advices of investors, the domestic securities company in which
transactions of B-shares of Little Swan are conducted shall declare the securities
account and custody unit of A-shares for each investor of Little Swan B-shares before
30 May 2019, which shall ensure investors can normally trade the A-shares of Midea
Group.
The B-shares of Little Swan registered in original securities account of B-shares will
be registered in the declared securities account of A-shares after converted into
A-shares of Midea Group. The B-shares of Little Swan will be trusted in the declared
custody unit of A-shares after the conversion. The mistaken declaration information on
the securities account and custody unit of A-shares, if any, may result in that investors
are unable to normally register or sell A-shares obtained after Little Swan B-shares are
converted into A-shares of Midea Group. Please check and ensure the information
declared is correct.
Manners to declare securities account and custody unit: Please complete the
Declaration Table for the Corresponding Relationship between the Securities Account
and Custody Unit of A-shares and those of B-shares (refer to Appendix 1 for details)
and send the following documents to sndd@citics.com:
1) Copy and paste the completed Declaration Table in the body of the message;
2) Print and seal the completed Declaration Table, and send the scanned copy as an
attachment of the message.
At the time of declaration, please completely declare the information on the securities
48
account and custody unit of A-shares corresponding to those of B-shares. In case the
information on the corresponding relationship would be declared for more than one
time, the full declaration information which is received last by our company will
prevail.
2. Where the securities account of A-shares fails to be declared before the designated
deadline, A-shares after conversion will be registered to the transfer registration
restricted account of related investors opened by CSDC, please refer to “Section III
Transfer Registration Restricted Account” of this chapter. Where the custody unit of
A-shares fails to be declared before the designated deadline, A-shares after conversion
will be transferred to the custody unit designated by CITIC Securities, and investor may
contact the CITIC Securities directly to handle custody transfer or make transaction
directly.
If there are any questions, please contact Shennan Avenue Business Department of
CITIC Securities Co., Ltd.
Contact information relating to the consultation and business of CITIC Securities:
Contact person: Shennan Avenue Business Department of CITIC Securities Co., Ltd.
Address: 301A Building A, Xinian Center, No. 6021, Shennan Avenue, Futian District,
Shenzhen
Tel.: 86-0755-83477942 (He Ying)
86-0755-83477944 (Luo Yixi)
86-0755-83477915 (Yang Zheng)
86-0755-83477941 (Shao Qicong)
Fax: 86-0755-83459951
Email: sndd@citics.com
49
Section III Transfer Registration Restricted Account
I. Allocation of Transfer Registration Restricted Account
After completing the business of cash option of B-shares of Little Swan, with respect
to the foreign institutional investor trading in domestic without or not declaring
securities account of A-shares, Midea Group will apply to CSDC for allocating one
transfer registration restricted account to the aforesaid free of any charge in accordance
with the information of B-shares securities account. As this securities account is
specially restricted, only the sell order declaration can be made and other purposes are
forbidden.
The securities company will notify investors of relevant matters concerning the
allocation of transfer registration restricted account by network, telephone, text
message, announcement in places of business, etc. Business department of each
securities company will assist the investor in opening the function of settlement by
RMB for original capital account of B-shares before making subsequent sell order
transactions relating to the transfer registration restricted account.
During the course to allocate the transfer registration restricted account, investors need
not carry out any extra operation. Before the listing of additional A-shares of Midea
Group on the stock market, securities company where the securities account of
B-shares of investors belongs will notify investors of relevant matters concerning the
allocation of transfer registration restricted account by network, telephone, text
message, announcement in places of business. Please be aware of the relevant notices
and announcements on the occasion.
After the transfer registration restricted account is allocated, investors can inquire of
the designated security company of A-shares custody unit via consultancy at counter,
telephone, online transaction system, etc. If no custody unit of A-shares is designated,
investors can inquire of CITIC Securities via consultancy at counter, telephone, online
transaction system, etc.
II. Way of Order
After the listing of A-shares of Midea Group, way of sell order relating to the investor’s
50
transfer registration restricted account will be declared in the way of order that investor
has applied to the business department of securities company where transactions of
transfer registration restricted account are made to open; where the online trading order
has been opened, investor may login in the online trading system through the account
number and trading password of the transfer registration restricted account, inquire
about the remaining A-shares of Midea Group and fund balance of transfer registration
restricted account and make sell order declaration.
III. Real-time Market Situation
Investor may obtain the real-time market situation and information on suspension and
resumption of trading relating to the A-shares of Midea Group through the existing
market situation display channel and way of the securities company where transactions
of transfer registration restricted account are made, such as on-site self-service terminal
of business department, online trading client terminal, etc.
IV Main Trading Rules
Stock code of sell order declaration of A-shares of Midea Group is “000333” and name
of securities is “Midea Group”. The way of sell order declaration is basically same as
the operation of B-shares.
(I) Limit of Change
A-shares shall not increase or decrease by 10% from the closing price of last trading
day within trading hours of that day.
Limit of change on ST shares and the shares that split share structure reform has not
been finished is 5%.
(II) Rotary Trading System
The T + 1 rotary trading system is implemented for the A-shares, namely, the shares
brought that day can be sold in the following day. The investor relating to the transfer
registration restricted account is only allowed to make the sell order declaration, so the
rotary trading is not applicable.
(III) Trading Unit
For A-share bought via bidding mode, the declared quantity shall be 100 shares or its
integral multiple. One-off sale declaration shall be made for the remaining shares less
51
than 100 shares.
(IV) Minimum Fluctuating Price
Minimum fluctuating unit of declared price of A-shares is RMB0.01.
(V) Trading Hours
Monday to Friday (excluding the national holidays and day of suspension of trading
stipulated by exchange);
9:15 to 9:25 of each trading day is the stage of opening call auction, wherein:
9:15 a.m. to 9:20 a.m.: Accept the trade declaration and the cancellation
9:20 a.m. to 9:25 a.m.: Accept the trade declaration, but do not accept the declaration of
cancellation
The order that is not made during the call auction will automatically enter into the
continuous auction;
From 9:30 to 11:30 and from 13:00 to 14:57 of each trading day is the time of
continuous auction;
14:57 to 15:00 is the stage of closing call auction
V. Liquidation and Settlement
Same rules are applied in transfer registration restricted account and ordinary A-shares
securities account and shares are liquidated and settled on the T + 0 day, which means
that the quantity of shares equal to the quantity of shares sold and concluded that day (T
day) by the investor will be decreased in the securities account that day; the RMB fund
is settled on the T + 1 day, which means that the investor can withdraw the RMB fund
obtained from the sale of shares that day (T day) in the following trading day (T + 1
day).
VI. Exchange of Currencies and Remittance of Funds
With respect to any foreign institutional investor for domestic transactions, to
which this chapter is applicable, the reduction of A-shares of Midea Group and
obtaining of dividends in Reminbi through his/her transfer registration
restricted account shall be pursuant to the Notice on Opening of Accounts
52
Involved in Share Reduction by and Dividends Attributable to Foreign
Shareholders of A-share Listed Companies and on Matters Related to Foreign
Exchange Control Issued by the General Office of the People’s Bank of China
(Y.B.F [2009] No. 178) and relevant provisions of the foreign exchange control:
(1) The foreign institutional investor shall open the securities account of
A-shares in the securities company (Midea Group shall apply to CSDC to
allocate one transfer registration restricted account), open the temporary RMB
deposit NRA (Non-Resident Account) at the Foshan Branch of CMBC and
connect the securities account and NRA at the counter of the Foshan Branch
of CMBC. The opening of an account by any foreign institutional investor shall
meet the requirements on anti-money laundering policy issued by international
organizations and countries such as the United Nation, United States of
America and the European Union as well as the Chinese government.
(2) The foreign institutional investor shall transfer the funds generated from
shareholding reduction or dividends into the NRA on the date when the
aforesaid funds are transferred into the securities account and the balance of
the securities account at the end of the T+1 day shall be zero. The funds in
Renminbi generated from shareholding reduction or dividends cannot be used
or withdrawn if the foreign institutional investor has not completed the opening
of NRA and the association of NRA and the securities account before the
shareholding reduction of A-shares of Midea Group or dividends obtaining
through the transfer registration restricted account.
53
(3) The foreign institutional investor shall provide CMBC with the following
materials for purchase of foreign currency and outbound remittance:
1) Written application; (including application for settlement and sale of foreign
exchange of CMBC, application for outbound remittance and written
application of foreign institutional investor)
2) A valid certificate of capital source;
3) Relevant tax registration form or tax payment receipt;
4) Identification document of the applicant and the copy thereof (relevant letter
of authorization notarized shall be provided with respect to any authorization);
5) Business Registration Certificate for FDI of A-share Listed Companies
(shareholding reduction of A-shares);
6) Other materials required by State Administration of Foreign Exchange.
(4) With respect to any foreign institutional investor who has reduced all
A-shares held and funds generated from share reduction and dividends have
been remitted through purchase of foreign currency or used domestically upon
approval in full, the securities account and deposit account shall be cancelled
within five working days after the completion of the above procedures. If the
foreign institutional investor fails to perform this obligation, the CMBC has the
right to freeze the customer’s deposit account, manage as dormant account
and cancel forcibly when certain conditions are met.
Note: If there is any adjustment on policies regarding foreign exchange control
and cross-border RMB during the business period, the latest supervision and
54
administration requirements shall be observed.
Foreign institutional investors may inquire Foshan Branch of China Merchants
Bank about how to open an NRA account and exchange currencies.
Contact information of Foshan Branch of CMBC:
Contact person: Huang Xiaopeng (Tel: 86-0757-81999101; Email:
huangxp8@cmbchina.com)
Contact person: Sun Guodong (Tel: 86-0757-81999113; Email:
sunguodong@cmbchina.com)
Contact person: Gu Ying (Tel: 86-0757-81999131; Email:
guying0917@cmbchina.com)
Address for materials sending: CMBC Building, Denghu East Road No. 12,
Nanhai District, Foshan, Guangdong Province (please contact the contact
person for confirmation before mailing).
VII. Capitalizing of Common Reserves, Bonus Shares and Dividend Distribution
The capitalizing of common reserves, registration of bonus shares and dividend
distribution relating to the shares in the transfer registration restricted account shall be
handled by reference to the existing normal A-shares account.
55
Section IV Trading Cost
The foreign investor who opens the transfer registration restricted account is required
to pay commission, stamp tax, etc. same as the current ordinary A-shares securities
account and the foreign exchange purchase expenses of RMB to HKD and charges for
remittance of HKD. Currently, the foreign exchange purchase of HKD involves no
additional expenses and the exchange rate when purchasing foreign exchange uses the
selling price of spot exchange of RMB to HKD on the day when the foreign exchange
purchase bank purchasing foreign exchange. Charges for remittance of HKD are
subject to the charges of the foreign exchange purchase bank.
Ordinary Ordinary Transfer
Name of B-share A-share Registration
Rate
Trading Cost Securities Securities Restricted
Account Account Account
Commission
for Refer to
original
domestic
transaction
account √ √ √
commission
opening
of A-share or
securities
B-share
company
0.1% (only
Stamp tax charge the √ √ √
seller)
0.05% (charged
Liquidation based on
√
expense the trading
amount)
It is handled in
accordance with
the selling price
of spot
Foreign exchange
exchange
of RMB to
purchase
HKD when the
expense
foreign
of HKD
exchange bank
purchasing of
foreign
exchange.
Charges for Charges for √
56
remittance of remittance of
HKD
HKD
are subject to
the charges of
the
foreign
exchange
purchase bank.
0.0487‰ of the
trading
Handling fee amount(charge √ √ √
the buyer
and seller)
0.02‰ of the
Registration trading
and amount(charge √ √
transfer fee the buyer
and seller)
0.02‰ of the
trading
Supervision fee amount(charge √ √ √
the buyer
and seller)
57
Section V Inquiry Business
After Little Swan B-shares are converted into A-shares of Midea Group, the investors
may inquire about the remaining securities in the account and balance of fund in the
current inquiry way relating to the securities account in the securities company where
transactions of transfer registration restricted account are made.
In addition, all investors may obtain all the disclosed information relating to this
stock-for-stock conversion from the website of SZSE (http://www.szse.cn/).
58
Section VI Change of Account Information
The information relating to the transfer registration restricted account is copied from
current information of investor’s B-shares securities. The investor whose identity
information is changed is required to contact the securities company promptly, which
is required to promptly handle the information change to the B-shares securities
account and transfer registration restricted account to ensure consistency.
59
Section VII General Meeting of Shareholders
Investors may attend the General Meeting of Shareholders and make the voting on the
scene in person or by proxy. With respect to the investor who intends to be present at
the meeting, at the day of General Meeting of Shareholders, individual investors shall
hold stock account card (the investors allocated the transfer registration restricted
account may only hold the original B-shares securities account card), personal ID card
or other valid certificates or paper of identification that can prove the identity);
representative of institutional investors shall hold the stock account card (the investors
allocated the transfer registration restricted account may only hold the original
B-shares securities account card) and certificate provided by the unit of shareholder
when attending the General Meeting of Shareholders. Agent shall also present the
power of attorney and valid personal ID.
After the custody relationship for the transfer registration restricted account has been
established, investors may make the online voting in accordance with the current
voting procedures for the ordinary A-shares securities account.
60
Section VIII Allotment of Shares
Before foreign residents can subscribe A-shares, or foreign residents sell all A-shares
of Midea Group held by them, Midea Group will take the fact that the part of trading
rights relating to the A-shares securities account are restricted with extreme caution
and fully consider fairness of participation right of various investors when handling
relevant matters including allotment of shares.
61
Section IX Cancellation of Transfer Registration Restricted Account
When remaining A-shares of Midea Group in the transfer registration restricted
account of an investor is zero, the securities company where transactions of transfer
registration restricted account are made may cancel the transfer registration restricted
account.
62
Section X Pledge, Freezing and Non-trading Transfer of Account
1. Pledge, non-trading transfer business: are handled in accordance with relevant
business rules of CSDC.
2. Judicial business: is implemented with assistance provided by each securities
company and CSDC.
63
Chapter IV Foreign Individual Investor for Non-domestic
Transaction
In order to guarantee that investors can conduct transactions smoothly after Little
Swan B-shares are converted A-shares of Midea Group, the foreign individual
investors for non-domestic transaction, to which this Chapter is applicable, shall fully
understand and confirm the matters shown below:
1. With respect to the investor who holds the A-shares of Midea Group as the Little
Swan B-shares are not sold on the last trading day and fails to validly declare the cash
option, sale of shares in future will be settled in RMB and finally settled in HKD by the
securities company with the transfer registration restricted account purchasing foreign
exchange through the foreign exchange purchase bank, and the exchange rate when
purchasing foreign exchange uses the selling price of spot exchange of RMB to HKD
on the day when the foreign exchange purchase bank purchases foreign exchange;
2. With respect to the foreign individual investors for non-domestic transaction, to
which this Chapter is applicable, they can declare the available A-shares account (if
any) according to “Section II Determine the Securities Account and Custody Unit of
A-shares of Midea Group” in this chapter; if there are no A-shares account or they do
not declare it, then Midea Group will apply to CSDC to allocate one transfer
registration restricted account which only can makes the sell order declaration and shall
not be used for other purposes, and relevant investors shall fully understand the
restrictions on trading;
3. No transaction and settlement are made temporarily by securities company after
CSDC allocates transfer registration restricted account to the investor. Investor is
required to designate one domestic securities company as that where transactions of
transfer registration restricted account are made and handle formalities for opening
fund account in the business department of this securities company to achieve the
normal sale of A-shares of Midea Group from this transfer registration restricted
64
account. Such investors are proposed to select CITIC Securities as the securities
company where transactions of transfer registration restricted account are made; After
determining the domestic securities company, investor is required to timely submit its
custody unit to CITIC Securities. For the investor who fails to submit its custody unit
timely, his/her shares after conversion will be held in custody in the custody unit
designated by CITIC Securities. And investor may subsequently contact CITIC
Securities directly to handle custody transfer or make transaction directly.
4. Investor shall confirm that he/she is the investor, to which this Chapter is applied,
otherwise, potentially, relevant contents of this Operational Guidelines are not
complete applicable;
5. Investors shall fully understand the differences of trading rules between B-shares and
A-shares;
6. Stock code of trade declaration of A-shares of Midea Group is 000333 and name of
securities is “Midea Group”
7. Investors shall continuously pay attention to relevant announcements issued by Little
Swan and Midea Group and learn the progress of this stock-for-stock merger;
8. In accordance with the Guidelines on the Registration and Settlements Service of
B-share Business, the shareholders of Little Swan B-shares may appoint agent to apply
to CSDC Shenzhen Branch for the share adjustment of the agent account 23 May 2019.
9. Investors may inquire of the securities company where the transfer registration
restricted account is made about the specific ways of business operation relating to the
account conversion.
65
Section I Business-related Organizations
Full name of Abbreviation in this
Main relevant matters
organization guidelines
Midea Group Co.,
Midea Group Information disclosure
Ltd.
Wuxi Little Swan Little Swan, Little
Information disclosure
Company Limited Swan B
China Securities
Depository and Allocation of transfer registration restricted
CSDC
Clearing account
Corporation Limited
Shenzhen Stock Restrictions on buy order declaration of transfer
SZSE
Exchange registration restricted account
Provide business consultation and handling
CITIC Securities
CITIC Securities service for the investor involved in this account
Co., Ltd
conversion.
Handle all business applications of investors
and consultation, communication and notice;
assist investors in opening common A-shares
Domestic securities Domestic securities
account the transfer registration restriction
companies companies
account in the trading system and assist
investors to complete the handling formalities
of third party custody meanwhile.
66
Section II Determine the Securities Account and Custody Unit of A-shares of
Midea Group
As the existing B-shares security account of Little Swan B-shares investors cannot be
directly registered into A-shares of Midea Group, and SZSE implements the shares
custody transfer trading system, one investor may have more than one custody unit
under one securities account. Therefore, securities account and custody unit of
A-shares of Midea Group will be determined in accordance with the principles shown
below after stock conversion:
1. Investor who would designate its securities account and custody unit by
himself/herself may contact CITIC Securities and designate the future securities
account and custody unit of Midea Group A-shares prior to 30 May 2019.
Manners to declare securities account and custody unit: Please complete the
Declaration for the Securities Account and Custody Unit of B-share Investors for
Non-domestic Transaction of Little Swan (refer to Appendix 2 for details) and the
securities company of designated custody unit of A-shares shall send the following
documents to sndd@citics.com;
1) Copy and paste the completed Declaration for the Custody Unit of B-share Investors
for Non-domestic Transaction in the body of the message;
2) Print and seal the completed Declaration for the Custody Unit of B-share Investors
for Non-domestic Transaction, and send the scanned copy as an attachment of the
message.
At the time of declaration, please completely declare the information on the securities
account and custody unit of A-shares. In case the information would be declared for
more than one times, the full declaration information which is received last by our
company will prevail.
2. If the A-share securities account of investors is not declared before the appointed
expiration date, the converted A-shares of Midea Group will be registered into
transfer registration restricted account for relevant investors by China Securities
Depository and Clearing Corporation Limited. Please refer to “Section III Transfer
67
Registration Restricted Account” in this chapter. To offer convenience to investors, our
company entrusts CITIC Securities to provide default custody unit. In case the foreign
investors for non-domestic transaction of B-share don’t declare his/her custody unit to
CITICS Securities before 30 May 2019, the A-shares of Midea Group obtained will be
automatically held in custody in the custody unit of Shennan Avenue Business
Department of CITIC Securities Co., Ltd. The aforesaid investor will not carry out
transaction, custody transfer and other operation until he/she handles related formalities
such as opening fund account in Shennan Avenue Business Department of CITIC
Securities Co., Ltd.
If there are any questions, please contact Shennan Avenue Business Department of
CITIC Securities Co., Ltd.
Contact information relating to the consultation and business of CITIC Securities:
Contact person: Shennan Avenue Business Department of CITIC Securities Co., Ltd.
Address: 301A, A building, Xinian Center, No. 6021, Shennan Avenue, Futian District,
Shenzhen
Tel.: 86-0755-83477942 (He Ying) 86-0755-83477944 (Luo Yixi)
86-0755-83477915 (Yang Zheng) 86-0755-83477941 (Shao Qicong)
Fax: 86-0755-83459951
Email: sndd@citics.com
68
Section III Transfer Registration Restricted Account
I. Allocation of transfer registration restricted account
With respect to the foreign individual investors for non-domestic transaction without
A-share securities account or without declaring A-share securities account, Midea
Group will apply to the CSDC to allocate transfer registration restricted account to the
aforesaid free of any charge in accordance with the information of B-share securities
account after the cash option business relating to the Little Swan B-shares has been
completed. As this securities account is specially restricted, only the sell order
declaration can be made and other purposes are forbidden.
As B-share securities account of investor is not opened in any domestic securities
company, the investor, after knowing relevant matters concerning this account
conversion, is required to designate one domestic securities company as that where
future transactions of transfer registration restricted account will be made (see Section
II of this Chapter for details). Investor is required to handle the formalities for opening
fund account in this securities company and this securities company has opened the
fund account of transfer registration restricted account of investor, then the inquiry and
sell order declaration relating to the A-shares of Midea Group in the transfer
registration restricted account can be made.
Investor, after knowing relevant matters concerning this account conversion, is
required to determine one securities company as that where future transactions of
transfer registration restricted account will be made and handle formalities for opening
fund account in the business department of this securities company to achieve the
normal sale of A-shares of Midea Group from this transfer registration restricted
account. It is suggested that the aforesaid investor gives preference to the CITIC
Securities as the securities company where future transactions of transfer registration
restricted account will be made.
II. Way of account opening
For detailed procedures relating to the account opening formalities, investor may
consult the CITIC Securities.
69
Investor cannot make the sell order declaration of A-shares of Midea Group until the
securities company where future transactions of transfer registration restricted account
will be made has been determined and account has opened in this securities company.
Investor may contact CITIC Securities (entrusted by Midea Group) and inquire about
the information relating to the transfer registration restricted account.
Meanwhile, investor may also contact CITIC Securities and consult the business
procedures relating to the account opening, subsequent operations of transfer
registration restricted account, etc. involved in this account conversion, and may
complete the handling of aforesaid businesses in CITIC Securities. Investor, after
knowing details of relevant businesses, may also choose other domestic securities
companies and handle relevant businesses. For procedures for handling businesses,
investor may consult the securities company chosen by him/her.
Contact information relating to the consultation and business of CITIC Securities:
Contact person: Shennan Avenue Business Department of CITIC Securities Co., Ltd.
Address: 301A, A building, Xinian Center, No. 6021, Shennan Avenue, Futian District,
Shenzhen
Tel.: 86-0755-83477942 (He Ying) 86-0755-83477944 (Luo Yixi)
86-0755-83477915 (Yang Zheng) 86-0755-83477941 (Shao Qicong)
Fax: 86-0755-83459951
Email: sndd@citics.com
III. Way of order
After the securities account where transactions of transfer registration restricted
account are made has completed account opening procedures for the investor, way of
sell order relating to the investor’s transfer registration restricted account will be
declared in various ways of order that investor has applied to the business department
of securities company where transactions of transfer registration restricted account are
made to open; where the online trading order has been opened, investor may login in
the online trading system through the fund account number and trading password set
when opening account, inquire about the remaining A-shares of Midea Group and fund
balance of transfer registration restricted account and make sell order declaration.
70
IV. Real-time market situation
Investor may obtain the real-time market situation and information of and suspension
and resumption of trading relating to the A-shares of Midea Group through the existing
market situation display channel and way of the securities company where transactions
of future transfer registration restricted account are made, such as on-site self-service
terminal of business department, online trading client terminal, etc.
V. Main trading rules
Stock code of sell order declaration of A-shares of Midea Group is 000333, name of
securities is “Midea Group” and the way of sell order declaration is basically same as
the operation of B-shares.
(I) Limit of change
A-shares shall not increase or decrease by 10% from the closing price of last trading
day within trading hours that day. Limit of change on ST shares and the shares that split
share structure reform has not been finished is 5%.
(II) Rotary trading system
The T + 1 rotary trading system is implemented for the A-shares, namely, the shares
brought that day can be sold in the following day. The investor relating to the transfer
registration restricted account is only allowed to make the sell order declaration, so the
rotary trading is not applicable.
(III) Trading unit
For A-share bought via bidding mode, the declared quantity shall be 100 shares or its
integral multiple. One-off sale declaration shall be made for the remaining shares less
than 100 shares.
(IV) Minimum fluctuating price
Minimum fluctuating unit of declared price of A-shares is RMB 0.01.
(V) Transaction date
Monday to Friday (excluding the national holidays and day of suspension of trading
stipulated by exchange);
9:15 to 9:25 of each trading day is the stage of opening call auction, wherein:
9:15 a.m. to 9:20 a.m.: Accept the trade declaration and the cancellation
71
9:20 a.m. to 9:25 a.m.: Accept the trade declaration, but do not accept the
declaration of cancellation
The order that is not made during the call auction will automatically enter into the
continuous auction;
From 9:30 to 11:30 and from 13:00 to 14:57 of each trading day is the time of
continuous auction;
14:57 to 15:00 is the stage of closing call auction
VI. Liquidation and settlement
Same rules are applied in transfer registration restricted account and ordinary A-share
securities account and shares are liquidated and settled on the T + 0 day, which means
that the quantity of shares equal to the quantity of shares sold and concluded that day (T
day) by the investor will be decreased in the securities account that day; the RMB fund
is settled on the T + 1 day, which means that the investor can withdraw the RMB fund
obtained from the sale of shares that day (T day) in the following trading day (T + 1
day).
With respect to the foreign individual investors for non-domestic transaction, to which
this Chapter is applicable to, the RMB fund obtained from sale of shares cannot be used,
withdrawn and is required to be converted into HKD in accordance with requirements
of State Administration of Foreign Exchange, namely, the securities company converts
the RMB fund into HKD and make the settlement. Therefore, the RMB fund obtained
from sale of shares of investor’s transfer registration restricted account will be settled
on the T + 1 day; the HKD fund that can be withdrawn finally will be settled on the T +
3 day after foreign exchange purchase bank has purchased foreign exchange, which
means the investor may apply to the securities company to withdraw the HKD obtained
from sale of shares on the T + 3 day. Investor may inquire of the securities company
where transactions of transfer registration account are made about the specific ways of
details.
VII. Payment of fund
After inquiring that balance of HKD in the fund account opened in the securities
company where transactions of transfer registration restricted account are made
72
increases, investor may send withdrawal application to this securities company; with
respect to the details of withdrawal application procedures, formalities, final way of
payment of fund and costs, investor may inquire of this securities company.
VIII. Capitalizing of common reserves, bonus shares and dividend distribution
The capitalizing of common reserves, registration of bonus shares and dividend
distribution relating to the shares in the transfer registration restricted account shall be
handled by reference to the existing normal A-share account.
73
Section IV Trading Cost
The foreign investor who opens the transfer registration restricted account is required to
pay commission, stamp tax, etc. same as the current ordinary A-share securities account
and the foreign exchange purchase expenses of RMB to HKD and charges for remittance of
HKD. Currently, the foreign exchange purchase of HKD involves no additional
expenses and the exchange rate when purchasing foreign exchange uses the selling
price of spot exchange of RMB to HKD on the day when the foreign exchange purchase
bank purchasing foreign exchange. Charges for remittance of HKD are subject to the
charges of the foreign exchange purchase bank.
Ordinary Ordinary Transfer
Name of Trading B-share A-share registration
Rate
cost securities securities restricted
account account account
Commission
for
Refer to original
domestic
transaction
account √ √ √
commission of A-share
opening
or B-share
securities
company
0.1% (only charge the
Stamp tax √ √ √
seller)
0.05% (charged based
Liquidation
on the √
expense
trading amount)
Foreign It is handled in
exchange accordance with the
purchase selling price of spot
74
expense exchange of
of HKD RMB to HKD when the
foreign exchange bank
purchasing of foreign
exchange.
Charges for remittance
Charges for of HKD are subject to
remittance of the charges of the √
HKD foreign exchange
purchase bank.
0.0487‰ of trading
Amount (charge the
Handle fee √ √ √
buyer and
seller)
0.02‰ of the trading
Registration
Amount (charge the
and √ √
buyer and
transfer fee
seller)
0.02‰ of the trading
Amount (charge the
Supervision fee √ √ √
buyer and
seller)
75
Section V Inquiry Business
After Little Swan B-shares are converted into the A-shares of Midea Group, the
investor may inquire about the remaining securities in the account and balance of fund
in the current inquiry way relating to the securities account in the securities company
where transactions of transfer registration restricted account are made.
In addition, all investors may obtain all the disclosed information relating to this
stock-for-stock conversion from the website of SZSE (http://www.szse.cn/).
76
Section VI Change of Account Information
The information relating to the transfer registration restricted account is copied from
current information of investor’s B-share securities. The investor whose identity
information is changed is required to contact the securities company promptly, which is
required to promptly handle the information change to the B-share securities account
and transfer registration restricted account to ensure consistency.
77
Section VII General Meeting of Shareholders
Investor may attend the General Meeting of Shareholders and make the voting on the
scene in person or by proxy. With respect to the investor who intends to be present at the
meeting, at the day of General Meeting of Shareholders, individual investor shall hold
stock account card (the investor allocated the transfer registration restricted account
may only hold the original B-share securities account card), personal ID card or other
valid certificates or paper of identification that can prove the identity); representative of
institutional investor shall hold the stock account card of the unit of shareholder (the
investor allocated the transfer registration restricted account may only hold the original
B-share securities account card) and certificate provided by the unit of shareholder
when attending the General Meeting of Shareholders. Agent shall also present the
power of attorney and valid personal ID.
After having determined the domestic securities company where transactions of
transfer registration account will be made and handled account opening procedures in
this securities company, investor may make the online voting in accordance with the
current voting procedures for the ordinary A-share securities account.
Investor who has not determined the securities company where future transactions of
transfer registration restricted account will be made and handled account opening
procedures in this securities company is required to contact Midea Group and attend the
General Meeting of Shareholders and vote by himself/herself.
Contact information of Midea Group:
Address: No. 26-28 building, B area, Headquarters Bulding of Midea, No. 6 Midea
Avenue, Beijiao Town, Shunde District, Foshan.
Contact person: Jiang Peng
Tel.: 0757-26637438
Fax: 0757-26605456
78
Section VIII Allotment of Shares
Before foreign residents can subscribe A-shares, or foreign residents sell all A-shares of
Midea Group held by them, A-shares of Midea Group will take the fact that the part of
trading rights relating to the A-share securities account are restricted with extreme
caution and fully consider fairness of participation right of various investors when
handling relevant matters including allotment of shares.
79
Section IX Cancellation of Transfer Registration Restricted Account
When remaining A-shares of Midea Group in the transfer registration restricted
account of investor is zero, the securities company where transactions of transfer
registration restricted account are made may cancel the transfer registration restricted
account.
80
Section X Pledge, Freezing and Non-trading Transfer of Account
1. Pledge, non-trading transfer business: are handled in accordance with relevant
business rules of CSDC.
2. Judicial business: is implemented with assistance provided by each securities
companies and CSDC.
81
Chapter V Foreign Institutional Investor for Non-domestic
Transaction
In order to guarantee that investors can conduct transactions smoothly after Little
Swan B-shares are converted A-shares of Midea Group, the foreign institutional
investors for non-domestic transaction, to which this Chapter is applicable, shall fully
understand and confirm the matters shown below:
1. With respect to any investor who holds the A-shares of Midea Group as the
Little Swan B-shares are not sold on the last trading day and fails to validly
declare the cash option, sale of shares in future will be settled in RMB. After
the completion of this stock-for-stock merger, with respect to any foreign
institutional investor for non-domestic transactions who formerly holds
B-shares of Little Swan, the reduction of A-shares of Midea Group and
obtaining of dividends in Reminbi through his/her transfer registration
restricted account shall be pursuant to the Notice on Opening of Accounts
Involved in Share Reduction by and Dividends Attributable to Foreign
Shareholders of A-share Listed Companies and on Matters Related to Foreign
Exchange Control Issued by the General Office of the People’s Bank of China
(Y.B.F [2009] No. 178) and relevant provisions of the foreign exchange control.
2. With respect to the foreign institutional investors for non-domestic transaction, to
which this Chapter is applicable, they can declare the available A-shares account (if
any) according to “Section II Determine the Securities Account and Custody Unit of
A-shares of Midea Group” in this chapter; if there are no A-shares account or they do
not declare it, then Midea Group will apply to CSDC to allocate one transfer
registration restricted account which only can makes the sell order declaration and shall
82
not be used for other purposes, and relevant investors shall fully understand the
restrictions on trading;
3. No transaction and settlement are made temporarily by securities company after
CSDC allocates transfer registration restricted account to the investor. Investor is
required to designate one domestic securities company as that where transactions of
transfer registration restricted account are made and handle formalities for opening
fund account in the business department of this securities company to achieve the
normal sale of A-shares of Midea Group from this transfer registration restricted
account. Such investors are proposed to select CITIC Securities as the securities
company where transactions of transfer registration restricted account are made; After
determining the domestic securities company, investor is required to timely submit its
custody unit to CITIC Securities. For the investor who fails to submit its custody unit
timely, his/her shares after conversion will be held in custody in the custody unit
designated by CITIC Securities. And investor may subsequently contact CITIC
Securities directly to handle custody transfer or make transaction directly.
4. Investor shall confirm that he/she is the investor, to which this Chapter is applied,
otherwise, potentially, relevant contents of this Operational Guidelines are not
complete applicable;
5. Investors shall fully understand the differences of trading rules between B-shares and
A-shares;
6. Stock code of trade declaration of A-shares of Midea Group is 000333 and name of
securities is “Midea Group”
7. Investors shall continuously pay attention to relevant announcements issued by Little
Swan and Midea Group and learn the progress of this stock-for-stock merger;
8. In accordance with the Guidelines on the Registration and Settlements Service of
B-share Business, the shareholders of Little Swan B-shares may appoint agent to apply
to CSDC Shenzhen Branch for the share adjustment of the agent account 23 May 2019.
9. Investors may inquire of the securities company where the transfer registration
restricted account is made about the specific ways of business operation relating to the
account conversion.
83
10. Foreign institutional investors may inquire Foshan Branch of China
Merchants Bank about how to open an NRA account and exchange
currencies.
84
Section I Business-related Organizations
Full name of Abbreviation in
Main relevant matters
organization this guidelines
Midea Group Co.,
Midea Group Information disclosure
Ltd.
Wuxi Little Swan Little Swan,
Information disclosure
Company Limited Little Swan B
China Securities
Depository and
CSDC Allocation of transfer registration restricted account
Clearing Corporation
Limited
Shenzhen Stock Restrictions on buy order declaration of transfer
SZSE
Exchange registration restricted account
CITIC Securities Co., CITIC Provide business consultation and handling service
Ltd Securities for the investor involved in this account conversion.
Handle all business applications of investors and
consultation, communication and notice; assist
Domestic
Domestic securities investors in opening common A-shares account the
securities
companies transfer registration restriction account in the trading
companies
system and assist investors to complete the handling
formalities of third party custody meanwhile.
Handle applications of foreign institutional
investors regarding to opening of NRA, provide
Foshan Branch of Foshan
services related to currency exchange such as
China Merchants Branch of
consultation, communication and notice and
Bank CMBC
assist investors to exchange currencies and
remit funds as required by relevant foreign
85
exchange regulations.
86
Section II Determine the Securities Account and Custody Unit of A-shares of
Midea Group
As the existing B-shares security account of Little Swan B-shares investors cannot be
directly registered as A-shares of Midea Group, and SZSE implements the shares
custody transfer trading system, one investor may have more than one custody unit
under one securities account. Therefore, securities account and custody unit of
A-shares of Midea Group will be determined in accordance with the principles shown
below after stock conversion:
1. Investor who would designate its securities account and custody unit by
himself/herself may contact CITIC Securities and designate the future securities
account and custody unit of Midea Group A-shares prior to 30 May 2019.
Manners to declare securities account and custody unit: Please complete the
Declaration for the Securities Account and Custody Unit of B-share Investors for
Non-domestic Transaction of Little Swan (refer to Appendix 2 for details) and the
securities company of designated custody unit of A-shares shall send the following
documents to sndd@citics.com;
1) Copy and paste the completed Declaration for the Custody Unit of B-share Investors
for Non-domestic Transaction in the body of the message;
2) Print and seal the completed Declaration for the Custody Unit of B-share Investors
for Non-domestic Transaction, and send the scanned copy as an attachment of the
message.
At the time of declaration, please completely declare the information on the securities
account and custody unit of A-shares. In case the information would be declared for
more than one times, the full declaration information which is received last by our
company will prevail.
2. If the A-share securities account of investors is not declared before the appointed
expiration date, the converted A-shares of Midea Group will be registered into
transfer registration restricted account for relevant investors by China Securities
Depository and Clearing Corporation Limited. Please refer to “Section III Transfer
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Registration Restricted Account” in this chapter. To offer convenience to investors, our
company entrusts CITIC Securities to provide default custody unit. In case the foreign
investors for non-domestic transaction of B-share don’t declare his/her custody unit to
CITICS Securities before 30 May 2019, the A-shares of Midea Group obtained will be
automatically held in custody in the custody unit of Shennan Avenue Business
Department of CITIC Securities Co., Ltd. The aforesaid investor will not carry out
transaction, custody transfer and other operation until he/she handles related formalities
such as opening fund account in Shennan Avenue Business Department of CITIC
Securities Co., Ltd.
If there are any questions, please contact Shennan Avenue Business Department of
CITIC Securities Co., Ltd.
Contact information relating to the consultation and business of CITIC Securities:
Contact person: Shennan Avenue Business Department of CITIC Securities Co., Ltd.
Address: 301A, A building, Xinian Center, No. 6021, Shennan Avenue, Futian District,
Shenzhen
Tel.: 86-0755-83477942 (He Ying) 86-0755-83477944 (Luo Yixi)
86-0755-83477915 (Yang Zheng) 86-0755-83477941 (Shao Qicong)
Fax: 86-0755-83459951
Email: sndd@citics.com
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Section III Transfer Registration Restricted Account
I. Allocation of transfer registration restricted account
With respect to the foreign institutional investors for non-domestic transaction without
A-share securities account or without declaring A-share securities account, Midea
Group will apply to the CSDC to allocate transfer registration restricted account to the
aforesaid free of any charge in accordance with the information of B-share securities
account after the cash option business relating to the Little Swan B-shares has been
completed. As this securities account is specially restricted, only the sell order
declaration can be made and other purposes are forbidden.
As B-share securities account of investor is not opened in any domestic securities
company, the investor, after knowing relevant matters concerning this account
conversion, is required to designate one domestic securities company as that where
future transactions of transfer registration restricted account will be made (see Section
II of this Chapter for details). Investor is required to handle the formalities for opening
fund account in this securities company and this securities company has opened the
fund account of transfer registration restricted account of investor, then the inquiry and
sell order declaration relating to the A-shares of Midea Group in the transfer
registration restricted account can be made.
Investor, after knowing relevant matters concerning this account conversion, is
required to determine one securities company as that where future transactions of
transfer registration restricted account will be made and handle formalities for opening
fund account in the business department of this securities company to achieve the
normal sale of A-shares of Midea Group from this transfer registration restricted
account. It is suggested that the aforesaid investor gives preference to the CITIC
Securities as the securities company where future transactions of transfer registration
restricted account will be made.
II. Way of account opening
For detailed procedures relating to the account opening formalities, investor may
consult the CITIC Securities.
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Investor cannot make the sell order declaration of A-shares of Midea Group until the
securities company where future transactions of transfer registration restricted account
will be made has been determined and account has opened in this securities company.
Investor may contact CITIC Securities (entrusted by Midea Group) and inquire about
the information relating to the transfer registration restricted account.
Meanwhile, investor may also contact CITIC Securities and consult the business
procedures relating to the account opening, subsequent operations of transfer
registration restricted account, etc. involved in this account conversion, and may
complete the handling of aforesaid businesses in CITIC Securities. Investor, after
knowing details of relevant businesses, may also choose other domestic securities
companies and handle relevant businesses. For procedures for handling businesses,
investor may consult the securities company chosen by him/her.
Contact information relating to the consultation and business of CITIC Securities:
Contact person: Shennan Avenue Business Department of CITIC Securities Co., Ltd.
Address: 301A, A building, Xinian Center, No. 6021, Shennan Avenue, Futian District,
Shenzhen
Tel.: 86-0755-83477942 (He Ying) 86-0755-83477944 (Luo Yixi)
86-0755-83477915 (Yang Zheng) 86-0755-83477941 (Shao Qicong)
Fax: 86-0755-83459951
Email: sndd@citics.com
III. Way of order
After the securities account where transactions of transfer registration restricted
account are made has completed account opening procedures for the investor, way of
sell order relating to the investor’s transfer registration restricted account will be
declared in various ways of order that investor has applied to the business department
of securities company where transactions of transfer registration restricted account are
made to open; where the online trading order has been opened, investor may login in
the online trading system through the fund account number and trading password set
when opening account, inquire about the remaining A-shares of Midea Group and fund
balance of transfer registration restricted account and make sell order declaration.
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IV. Real-time market situation
Investor may obtain the real-time market situation and information of and suspension
and resumption of trading relating to the A-shares of Midea Group through the existing
market situation display channel and way of the securities company where transactions
of future transfer registration restricted account are made, such as on-site self-service
terminal of business department, online trading client terminal, etc.
V. Main trading rules
Stock code of sell order declaration of A-shares of Midea Group is 000333, name of
securities is “Midea Group” and the way of sell order declaration is basically same as
the operation of B-shares.
(I) Limit of change
A-shares shall not increase or decrease by 10% from the closing price of last trading
day within trading hours that day. Limit of change on ST shares and the shares that split
share structure reform has not been finished is 5%.
(II) Rotary trading system
The T + 1 rotary trading system is implemented for the A-shares, namely, the shares
brought that day can be sold in the following day. The investor relating to the transfer
registration restricted account is only allowed to make the sell order declaration, so the
rotary trading is not applicable.
(III) Trading unit
For A-share bought via bidding mode, the declared quantity shall be 100 shares or its
integral multiple. One-off sale declaration shall be made for the remaining shares less
than 100 shares.
(IV) Minimum fluctuating price
Minimum fluctuating unit of declared price of A-shares is RMB 0.01.
(V) Transaction date
Monday to Friday (excluding the national holidays and day of suspension of trading
stipulated by exchange);
9:15 to 9:25 of each trading day is the stage of opening call auction, wherein:
9:15 a.m. to 9:20 a.m.: Accept the trade declaration and the cancellation
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9:20 a.m. to 9:25 a.m.: Accept the trade declaration, but do not accept the
declaration of cancellation
The order that is not made during the call auction will automatically enter into the
continuous auction;
From 9:30 to 11:30 and from 13:00 to 14:57 of each trading day is the time of
continuous auction;
14:57 to 15:00 is the stage of closing call auction
VI. Liquidation and settlement
Same rules are applied in transfer registration restricted account and ordinary A-share
securities account and shares are liquidated and settled on the T + 0 day, which means
that the quantity of shares equal to the quantity of shares sold and concluded that day (T
day) by the investor will be decreased in the securities account that day; the RMB fund
is settled on the T + 1 day, which means that the investor can withdraw the RMB fund
obtained from the sale of shares that day (T day) in the following trading day (T + 1
day).
VII. Exchange of Currencies and Remittance of Funds
With respect to any foreign institutional investor for non-domestic transactions,
to which this chapter is applicable, the reduction of A-shares of Midea Group
and obtaining of dividends in Reminbi through his/her transfer registration
restricted account shall be pursuant to the Notice on Opening of Accounts
Involved in Share Reduction by and Dividends Attributable to Foreign
Shareholders of A-share Listed Companies and on Matters Related to Foreign
Exchange Control Issued by the General Office of the People’s Bank of China
(Y.B.F [2009] No. 178) and relevant provisions of the foreign exchange control:
(1) The foreign institutional investor shall open the securities account of
A-shares in the securities company (Midea Group shall apply to CSDC to
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allocate one transfer registration restricted account), open the temporary RMB
deposit NRA (Non-Resident Account) at the Foshan Branch of CMBC and
connect the securities account and NRA at the counter of the Foshan Branch
of CMBC. The opening of an account by any foreign institutional investor shall
meet the requirements on anti-money laundering policy issued by international
organizations and countries such as the United Nation, United States of
America and the European Union as well as the Chinese government.
(2) The foreign institutional investor shall transfer the funds generated from
shareholding reduction or dividends into the NRA on the date when the
aforesaid funds are transferred into the securities account and the balance of
the securities account at the end of the T+1 day shall be zero. The funds in
Renminbi generated from shareholding reduction or dividends cannot be used
or withdrawn if the foreign institutional investor has not completed the opening
of NRA and the association of NRA and the securities account before the
shareholding reduction of A-shares of Midea Group or dividends obtaining
through the transfer registration restricted account.
(3) The foreign institutional investor shall provide CMBC with the following
materials for purchase of foreign currency and outbound remittance:
1) Written application; (including application for settlement and sale of foreign
exchange of CMBC, application for outbound remittance and written
application of foreign institutional investor)
2) A valid certificate of capital source;
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3) Relevant tax registration form or tax payment receipt;
4) Identification document of the applicant and the copy thereof (relevant letter
of authorization notarized shall be provided with respect to any authorization);
5) Business Registration Certificate for FDI of A-share Listed Companies
(shareholding reduction of A-shares);
6) Other materials required by State Administration of Foreign Exchange.
(4) With respect to any foreign institutional investor who has reduced all
A-shares held and funds generated from share reduction and dividends have
been remitted through purchase of foreign currency or used domestically upon
approval in full, the securities account and deposit account shall be cancelled
within five working days after the completion of the above procedures. If the
foreign institutional investor fails to perform this obligation, the CMBC has the
right to freeze the customer’s deposit account, manage as dormant account
and cancel forcibly when certain conditions are met.
Note: If there is any adjustment on policies regarding foreign exchange control
and cross-border RMB during the business period, the latest supervision and
administration requirements shall be observed.
Foreign institutional investors may inquire Foshan Branch of China Merchants
Bank about how to open an NRA account and exchange currencies.
Contact information of Foshan Branch of CMBC:
Contact person: Huang Xiaopeng (Tel: 86-0757-81999101; Email:
huangxp8@cmbchina.com)
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Contact person: Sun Guodong (Tel: 86-0757-81999113; Email:
sunguodong@cmbchina.com)
Contact person: Gu Ying (Tel: 86-0757-81999131; Email:
guying0917@cmbchina.com)
Address for materials sending: CMBC Building, Denghu East Road No. 12,
Nanhai District, Foshan, Guangdong Province ( please contact the contact
person for confirmation before mailing).
VIII. Capitalizing of common reserves, bonus shares and dividend distribution
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The capitalizing of common reserves, registration of bonus shares and dividend
distribution relating to the shares in the transfer registration restricted account shall be
handled by reference to the existing normal A-share account.
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Section IV Trading Cost
The foreign investor who opens the transfer registration restricted account is required to
pay commission, stamp tax, etc. same as the current ordinary A-share securities account
and the foreign exchange purchase expenses of RMB to HKD and charges for remittance of
HKD. Currently, the foreign exchange purchase of HKD involves no additional
expenses and the exchange rate when purchasing foreign exchange uses the selling
price of spot exchange of RMB to HKD on the day when the foreign exchange purchase
bank purchasing foreign exchange. Charges for remittance of HKD are subject to the
charges of the foreign exchange purchase bank.
Ordinary Ordinary Transfer
Name of Trading B-share A-share registration
Rate
cost securities securities restricted
account account account
Commission
for
Refer to original
domestic
transaction
account √ √ √
commission of A-share
opening
or B-share
securities
company
0.1% (only charge the
Stamp tax √ √ √
seller)
0.05% (charged based
Liquidation
on the √
expense
trading amount)
Foreign It is handled in
exchange accordance with the
purchase selling price of spot
expense exchange of
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of HKD RMB to HKD when the
foreign exchange bank
purchasing of foreign
exchange.
Charges for remittance
Charges for of HKD are subject to
remittance of the charges of the √
HKD foreign exchange
purchase bank.
0.0487‰ of trading
Amount (charge the
Handle fee √ √ √
buyer and
seller)
0.02‰ of the trading
Registration
Amount (charge the
and √ √
buyer and
transfer fee
seller)
0.02‰ of the trading
Amount (charge the
Supervision fee √ √ √
buyer and
seller)
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Section V Inquiry Business
After Little Swan B-shares are converted into the A-shares of Midea Group, the
investor may inquire about the remaining securities in the account and balance of fund
in the current inquiry way relating to the securities account in the securities company
where transactions of transfer registration restricted account are made.
In addition, all investors may obtain all the disclosed information relating to this
stock-for-stock conversion from the website of SZSE (http://www.szse.cn/).
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Section VI Change of Account Information
The information relating to the transfer registration restricted account is copied from
current information of investor’s B-share securities. The investor whose identity
information is changed is required to contact the securities company promptly, which is
required to promptly handle the information change to the B-share securities account
and transfer registration restricted account to ensure consistency.
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Section VII General Meeting of Shareholders
Investor may attend the General Meeting of Shareholders and make the voting on the
scene in person or by proxy. With respect to the investor who intends to be present at the
meeting, at the day of General Meeting of Shareholders, individual investor shall hold
stock account card (the investor allocated the transfer registration restricted account
may only hold the original B-share securities account card), personal ID card or other
valid certificates or paper of identification that can prove the identity); representative of
institutional investor shall hold the stock account card of the unit of shareholder (the
investor allocated the transfer registration restricted account may only hold the original
B-share securities account card) and certificate provided by the unit of shareholder
when attending the General Meeting of Shareholders. Agent shall also present the
power of attorney and valid personal ID.
After having determined the domestic securities company where transactions of
transfer registration account will be made and handled account opening procedures in
this securities company, investor may make the online voting in accordance with the
current voting procedures for the ordinary A-share securities account.
Investor who has not determined the securities company where future transactions of
transfer registration restricted account will be made and handled account opening
procedures in this securities company is required to contact Midea Group and attend the
General Meeting of Shareholders and vote by himself/herself.
Contact information of Midea Group:
Address: No. 26-28 building, B area, Headquarters Bulding of Midea, No. 6 Midea
Avenue, Beijiao Town, Shunde District, Foshan.
Contact person: Jiang Peng
Tel.: 0757-26637438
Fax: 0757-26605456
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Section VIII Allotment of Shares
Before foreign residents can subscribe A-shares, or foreign residents sell all A-shares of
Midea Group held by them, A-shares of Midea Group will take the fact that the part of
trading rights relating to the A-share securities account are restricted with extreme
caution and fully consider fairness of participation right of various investors when
handling relevant matters including allotment of shares.
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Section IX Cancellation of Transfer Registration Restricted Account
When remaining A-shares of Midea Group in the transfer registration restricted
account of investor is zero, the securities company where transactions of transfer
registration restricted account are made may cancel the transfer registration restricted
account.
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Section X Pledge, Freezing and Non-trading Transfer of Account
1. Pledge, non-trading transfer business: are handled in accordance with relevant
business rules of CSDC.
2. Judicial business: is implemented with assistance provided by each securities
companies and CSDC.
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Appendix 1
Declaration Table for the Corresponding Relationship between the Securities
Account and Custody Unit of A-shares and the Securities Account and Custody
Unit of B-shares
A-share Number Custody unit Custody unit
B-share
Name of account of of B-share of A-share
account
person Name of number shares
Seri number
participat sharehol of held No. Name No. Name
al of
ing der sharehol by of of of of
No sharehol
into of Little der sharehol custo custo custo custo
. der
settlemen Swan of Little der dy dy dy dy
of Little
t Swan (if of Little unit unit unit unit
Swan
any) Swan
1
2
Handler: Contact number:
Full name of person participating in settlement:
(Company’s stamp)
Date:
105
Appendix 2:
Declaration for the Securities Account and Custody Unit of B-share Investors of
Non-domestic Transaction of Little Swan
I/Our company , (ID number/unified social credit
code ： , Security account number of Shenzhen
Stock： , is the foreign investor for non-domestic transaction of
Little Swan B-shares. since I/our company has determined matters of custody with the
domestic securities company (name of securities
company: ), I/our company herein declare that all
A-shares of Midea Group (stock code: 000333) obtained by converting the Little Swan
B-shares held by me/our company, (totally shares), will be
registered in (number of securities account, if any) , and will be
held in custody in (name of securities company) , whose
A-share seat No. in Shenzhen Stock Exchange is： .
Name of applicant:
Type of identity document of the applicant:
Number of identity document of the applicant:
Signed/stamped by the applicant:
Application date:
Handler of securities company: , Contact number:
Full name of person participating in settlement of Securities Company (company’s
seal):
Date:
106
(This page marks the end of this document with the company stamp on The
Operational Guidelines for Investors on the B-to-A-Stock Account Conversion with
regard to the Stock-for-Stock Merger of Wuxi Little Swan Company Limited by Midea
Group Co., Ltd. and the Related-Party Transaction.)
Wuxi Little Swan Company Limited
Date:
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