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On April 27, the Chinese securities authority issued its first penalty to a domestic company for going public overseas without completing local regulatory procedures.
Zhongneng Liangke Agricultural Technology, a Chinese provider of natural and health-focused food products, was fined 3 million yuan (approximately USD 414,000) for initiating a listing in the United States without fulfilling the necessary regulatory filings in China, according to the China Securities and Regulatory Commission.
This marks the first case since new foreign listing rules took effect in March 2023, which require domestic companies to complete specific procedures before listing abroad.
Liangke’s parent company, Liangke Technology Innovation Biology Hong Kong—formerly known as China Food Investment—filed a report with regulators at the end of 2024 to plan an indirect listing on the Nasdaq via a special-purpose acquisition company (SPAC).
The regulators asked for additional documentation on March 6, 2025. However, the company did not comply and went on to acquire the SPAC on October 1, eventually listing on Nasdaq under the name CN Healthy Food Technology Group (NASDAQ: UCFI).
Once the irregularities were discovered, authorities promptly notified U.S. regulators and Nasdaq through cross-border cooperation mechanisms. As a result, trading in CN Healthy Food Food was halted immediately on its debut day.
In addition to the fine on Zhongneng Liangke, the securities agency also penalized Liangke’s controller, Li Zhenjun, with a fine of 1.5 million yuan. The intermediary law firm involved, Guangdong Xinyu Law Firm, was fined 500,000 yuan (about USD 69,000), and lawyer Li Huabin was fined 200,000 yuan.
The regulators emphasized their intention to balance openness with risk management, supporting qualified Chinese companies in leveraging both domestic and international markets for sustainable growth. They also stated their commitment to strengthening law enforcement, standardizing filing procedures, increasing transparency, and enhancing cooperation with overseas authorities to ensure a fair and orderly market environment and protect investors’ rights.
On April 24, the authority also announced that DSC Holdings had completed its regulatory filings for a Nasdaq listing and share offering—marking the first official confirmation since last December that a Chinese company had finalized the filing process for a U.S. listing.
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