Opportunities for Foreign Investment in PRC Securities Companies
With the boom in the PRC equities markets and the emergence of outbound wealth, foreign interest in China's financial services market has grown substantially. In response to these pressures and the changing environment, the latest round of reforms in the securities industry offers increased clarity and certain real opportunities to tap into the growing PRC securities market.
Date:
February 2008
Promulgated: 10 February 2008
Keywords (click to search): [trading] [securities companies] [subsidiaries]
By Victor Ho, Lynn Yang, and Jane Jiang*
For foreign financial institutions, the PRC financial services market has always been a hugely promising but elusive opportunity. Not surprisingly, the PRC authorities have played a careful game and weighed a careful balance by allowing increased foreign market access, with the imperatives of developing local markets, building infrastructure and growing competitive and strong domestic financial institutions.
BACKGROUND
The PRC legal framework for the foreign financial services industry has been systematically developing since China's accession to the World Trade Organisation in December 2001. Financial regulation remains divided between three bodies, namely the China Securities Regulatory Commission (for securities) (the CSRC), the China Bank Regulatory Commission (for banking) (the CBRC) and the China Insurance Regulatory Commission (for insurance) (the CIRC). In a manner consistent with developments in the banking and insurance fields, the most recent legislative changes establish a multi-tiered legal regime governing foreign investment in domestic securities companies.
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