China’s securities regulator has announced new rules on global depositary receipts, paving the way for the resumption of a steady stream of listings in Europe.

Companies must register with the China Securities Regulatory Commission within three working days after submitting GDR listing applications overseas, according to new guidelines published late Tuesday. Any fundraising size should be reasonable, it said, without giving details, while pricing and lockup period for investors have to be in line with regulations. The regulator also requires companies to disclose the identities of the subscribers in their GDR issue as part of a report that has to be submitted within 15 working days of the sale.

The rules could potentially revitalize a market that was vibrant before CSRC held up approvals of new applications earlier this year. The authority was concerned that a substantial portion of the issue was being taken up by Chinese investors who later converted the securities into shares in their home market to profit from persistent price gaps, Bloomberg News reported in March. CSRC said in February it’s considering new rules for the offerings but didn’t publicly disclose details or comment on the pace of approvals.

Chinese companies raised almost $4 billion in Europe through GDR sales in 2022 when the Shanghai-London Stock Connect cross-border listing program was expanded to link Zurich and Frankfurt with Shanghai and Shenzhen, according to data compiled by Bloomberg. Only four deals were priced so far this year, raising a total of $1.1 billion.

Read more: Chinese Firms Are Back to Swiss Market After Hiatus: ECM Watch

Any revival of listings will also depend on investor demand as global fundraising activity has slowed down significantly on concerns over economic outlook. China’s economic recovery is also losing momentum after an initial burst in consumer and business activity early in the year.

Newly-listed firms in China’s domestic market this year have raised a total of $24 billion, down from the $43 billion raised for the same period in 2022. The Shanghai stock exchange in March abruptly called off the hearing for Syngenta Group’s $9.4 billion IPO. Sinochem Holdings Corp., the owner of the agrochemicals giant, is exploring ways to salvage the listing including a potential reduction in fundraising size as it seeks to mollify Chinese authorities’ concerns that a large offering could put pressure on liquidity in the local stock market, Bloomberg News reported last month.

The GDRs, primarily listed in Zurich, become fungible with so-called A-shares in mainland China after 120 days, and have tended to trade at discounts. The Shanghai-London Stock Connect was initially launched in 2019. The enlarged program promised to open up a channel for overseas fundraising amid geopolitical tensions with the US, a venue Chinese firms had traditionally favored.

--With assistance from Zhang Dingmin and David Morris.