According to the recent announcement posted on the website of China Securities Regulatory Commission (CSRC), as of October 30, 2010 (being the first anniversary of the opening of China Growth Enterprise Market "GEM"), the Public Offering Examination Committee for GEM, CSRC has examined a total of 192 application from Chinese enterprises, of which 152 of them were duly approved to list in the GEM. The relevant data showed that 66 law firms had participated in the application for IPO on GEM. By analyzing geographical distribution and market share of the law firms involved, it was concluded that the traditional pattern of legal services in relation to Chinese securities market remains the same.

In respect of their respective geographical position, the 66 law firms are located in three major cities, i.e. Beijing, Shanghai and Guangdong, and their market share in the capital market industry are more than 87%. With respect to the market share of law firms practicing in securities, the situation has not changed much. Those established law firms located in Beijing and Shanghai still take leading positions. Among the approved 152 enterprises, Grandall Legal Group has consistently maintained in the No. 1 position (in terms of overall market share) in the SME Market for years. Grandall led with a stunning 10% overall market share by acting for 15 out of those approved and successfully listed Chinese enterprises.

The above-mentioned figures have demonstrated that although the GEM market had a lower listing criteria, Chinese enterprises did not take it lightly when choosing law firms to act for them. Generally speaking, Chinese enterprises would still prefer the traditional legal industry players who are strong and reputable in terms of experience and expertise in the securities market. Enterprises are also becoming more and more prudent in their selection of law firms. Firstly, this is caused by the fierce competition within the legal market itself. As of October 22, 2010, CSRC has accepted applications from a total of 381 enterprises, said Mr. Shang Fulin, Chairman of the CSRC. Secondly, this is also due to the nature of securities-related legal services which require higher level of prudence and expertise as well as team work spirit. Thirdly, the risk associated in GEM market is extremely high. With the opening and operation of GEM, the risk factor will inevitably affect the decisions by the approval authorities whether or not to approved a company to list in the GEM, thus further increases the difficulty in listing and public offering. To be in strict accordance with the requirements under the relevant laws is the only way to achieve the financing purpose by way of listing. This has explained why many potential GEM enterprises are still willing to obtain professional legal services from prominent law firms.