On "Abolishing" And "No Waste" In IPO Approval System

China Approval System of Initial Public Offering(IPO) is originated from Examination and Approval System, accompanying with strong administrative color and a lot of problems. From the year of1990to2000, China Stock Offering System is always adopting the Examination and Approval Systems. The initiation of Approval System is beginning from March17.2001. From the present situation of our country, the affects of strong Examination and Approval System is still remain in our current system and bring a lot of malpractices. First of all, as a consequence of strict approval process of government, investors can be heavily rely on the determination of government and easy to ignore risks. It makes our stock market lose normal risk pricing ability to a great extent and lead to an erratic stock pricing. Secondly, strict government approval process can lead to rejection of some enterprises equipped with potential but lack of listing requirements. This kind of condition is to the disadvantage of development of emerging industry. Thirdly, the overload of securities regulators can lead to the occurrence of corruption. Finally, this kind of approval system lead to that the subsequent examination system is very loose, which then create opportunities for listed companies to behave illegally.Former chairman of China Securities Regulatory Commission, Guo Shuqing, threw a question " Can we give up the approval process in the process of initial public offering?" This topic lasted for more than ten years in capital market stirs up wide debate. As a consequence, it has been a hot topic whether the conditions are prepared for the transition from Approval System to Registration System."Reformation" has been the hottest vocabulary in current China securities market.This Article is to making a comparative study on whether reform the IPO management system on the basis of summary and review of existing literature at home and abroad.