Abstract: A-share market implements the IPO approval system in China. Before IPO, the company needs to undergo a strict examination by the issuance examination committee (IEC) and a series of procedures by CSRC. Therefore, after the investors know that the IPO application of a company has been approved, there will be several months that the company can issue its new shares to the investors. By using the listing companies' data on Chinese A-share market from 2006 to 2012, we study the industry effect of the IPO approval announcements. The empirical test result shows that there is a significant negative industry effect of IPO application approval announcements. At the day of IPO approval announcements, the listing companies in the same industry will get -0.37% abnormal return on average. When the IPO application is exanimated more strictly, the industry effect of IPO approval announcements is more significant. Especially for the high competitive industry, no matter whether the IPO application is examined strictly, there is more significant industry effect of IPO approval announcements than for the monopolized industry. The results support CSRC's decision to suspend IPO application when the market is in a bear situation and also expand the influence range of IPO application examination.

Key words: IPO application examination, issuance examination committee, IPO approval announcement, industry effect