China's securities regulator said on Friday that state-owned enterprises' (SOEs) mixed-ownership reform plans must strictly abide by new rules, and explained China Unicom's plan was not subject to the rules because it had been set before they were introduced.
The China Securities Regulatory Commission (CSRC) warned major shareholders that "any item related to the capital markets must strictly stick to existing rules published by the securities regulator" in a regular press conference.
The CSRC in February revised its rules on private placement where deal size shall not exceed 20 percent of the original equity. However, the percentage in Unicom's deal, which was announced in August, surpassed 40 percent.
The plan, in which Unicom is to raise 77.9 billion yuan (11.7 billion US dollars) from private companies including Tencent, Alibaba and Baidu, immediately raised eyebrows in Chinese media and investors who claimed it may have violated the new rules.
In a quick response, the CSRC said Unicom's plan had been formed under the guidance of the National Development and Reform Commission before its new rules came out, and it was subject to the previous rules.
The CSRC reiterated on Friday that the plan was being treated as an exceptional case. Some observers consider Unicom's reform as a pilot run to revitalize Chinese SOEs, partly because the plan involves the country's monopoly area.