China's securities reforms put spotlight on B-share dilemma

There’s nothing like a thorough spring clean to bring things into the open. The only problem, of course, is that you then have to deal with all the long-forgotten junk that turns up.

Guo Shuqing, China’s chief securities regulator, would probably sympathise. The delisting rules his office introduced recently, as part of a zealous reform package, have shed light on a dusty old corner of the country’s securities industry the B-share market.

Guo introduced the new rules in a bid to clear out some of the weaker A-share companies, but a requirement for loss-making or illiquid companies to delist is expected to have even bigger consequences for...