China has decided to expand its over-the-counter (OTC) market to all qualified small and medium-sized enterprises (SMEs), according to an official statement released on December 14.

The State Council announced that the OTC market, a national share transfer system for SMEs that is also known as the New Third Board will be expanded to cover all innovative and promising companies.

Qualified companies can apply for a listing on the board for public share transfers so as to realize equity and bond financing as well as aid in asset restructuring. Companies should ensure accurate and complete information disclosures on their operations.

Qualified enterprises can apply directly to be listed on the New Third Board through China's stock exchanges.

The State Council demanded the China Securities Regulatory Commission (CSRC) simplify approval procedures so as to increase efficiency.

The CSRC will exempt approval procedures for applying joint-stock companies with 200 or fewer shareholders and listed ones with private placement and no more than 200 shareholders, according to the State Council statement.