China is distancing itself from a major Chinese-operated tuna fishing company that has admitted breaching quotas for the most vulnerable species in the Pacific.

In a draft prospectus presented to the Hong Kong Stock Exchange, the China Tuna Industry Group revealed China had exceeded the catch quotas for Bigeye and Yellowfin tuna for three of the last four years for which records are available.

The Dalian-based company claimed sanctions were ineffective and that, according to legal advice, it would not be penalised for its actions.

It also outlined plans for a public listing that it hoped would raise more than $100 million to fund expansion of its activities.

The Chinese government has slammed the company's draft prospectus as "gravely misleading" and "incompatible" with China's conservation and management measures.

In a letter to environmental group Greenpeace, the Chinese Bureau of Fisheries said the company's actions were also in violation of laws and regulations.

"The Bureau is very surprised by this matter as the Bureau has never given approval for the China Tuna Industry Group Holdings Limited to engage in offshore fishing," it said.

"[The China Industry Group] have not registered their fishing boats with any regional fisheries management organisation (RFMO) nor allocated any quota to the company.

"The [draft] prospectus has gravely misled investors and the international community, and caused a tremendous negative impact."

Greenpeace welcomes China's criticism

Greenpeace East Asia senior business adviser Elsa Lee said the group welcomed China's "strong stand" against the company.

"We are looking forward to China taking stronger measures ... against the fishing companies to make sure that they are not over-catching the catch limit in the tuna stocks," she said.

Stocks of the species of targeted by the China Tuna Industry Group are at record lows.

Greenpeace wrote to the Hong Kong Stock Exchange alerting it to its duty to provide investors with accurate information.

"What Greenpeace found wrong about this draft prospectus of China Tuna Industry Group is that it used outdated tuna stock status of Bigeye tuna," Ms Lee said.

"We believe that the misuse of this data would mislead a potential investor of the company, that implies a viable business future for the company.

"The key point is that the Bigeye tuna stock is already overfished. In that sense, it is a very important information that an investor needs to know."

Greenpeace also wrote to Deutsche Bank warning its support of the company's initial public offering (IPO) risked breaching its own environmental guidelines.

The China Tuna Industry Group has since withdrawn its plan to list on the stock exchange.

China not off the hook with oversight body

Glenn Hurry, executive director of the Western and Central Pacific Fisheries Commission (WCPFC), is pleased with the result.

"I hope it stays off the stock market forever because it is a very naive view of how a company should be able to operate in an international environment," he told Radio Australia's Pacific Beat.

Over the last decade, China's longline tuna fleet has grown rapidly, leading to complaints from other nations and from environment organisations.

With Bigeye tuna down to 16 per cent of its original stocks and Yellowfin also under pressure, Pacific nations are pushing for tougher conservation measures.

The WCPFC, a multinational fisheries management body, said the Chinese government has been working hard to fix problems in its industry.

However, Mr Hurry said China will have some explaining to do when it meets with more than 30 countries that will come together in December to review conservation measures.

"The commission relies on individual countries making sure that their companies play by the rules and as China has emerged I guess that responsibility falls to the central government in Beijing to make sure that China complies," Mr Hurry said.

"I suspect there will be a number of questions raised on the prospectus at the commission meeting in Samoa in December, and I expect that China will have quite a few difficult questions to answer."