The government has adopted new rules for initial public offerings (IPOs) beginning today, paving the way for Industrial and Commercial Bank of China (ICBC), the mainland's largest bank, to launch a simultaneous IPO in Hong Kong and Shanghai.

New rules published yesterday by the China Securities Regulatory Commission will allow large companies offering more than 400 million shares to the public to use the greenshoe, or over-allotment option, for the first time. The Greenshoe option allows companies to increase their stock offers if there is demand.

Among other changes planned, the revised rules, which govern stock issues and underwriting, decree a simultaneous sale of IPO shares to institutional and retail investors instead of the current two-step process, which provides for institutions first, according to the new regulations published in domestic newspapers.

That will enhance the efficiency of domestic IPOs on the Shanghai and Shenzhen exchanges by shortening the corporate initial offering process by at least two days,.

"In general, the new rules reflect thoughts of enhancing efficiency of stock issues, improving supervision by the market, making stock offers fairer to all investors and allowing domestic exchanges to gradually integrate into mature markets," the Shanghai Securities News said.

The adoption of the greenshoe option and the shortening of the issuance period will allow ICBC's Shanghai offer to be consistent with Hong Kong, paving the way for it to list shares on the two exchanges at the same time.

The China Securities Journal said ICBC might be the first company to adopt the greenshoe option on the domestic exchanges.

Editor: Yan