Opening up the market for QFII investment in China's securities market

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clpstaff &clp articles

New rules allow greater investments in China's capital markets and impose a shorter lock-up period, but failure to comply could lead to the loss of QFII status

The Provisions on Foreign Exchange Control in Connection with Securities Investments in China by Qualified Foreign Institutional Investors (合格境外机构投资者境内证券投资外汇管理规定) were issued by the State Administration of Foreign Exchange (Safe) on September 29 2009. The Provisions contain almost the same changes set out in a consultation draft published on September 4. Key articles of the Provisions include the increase of a single Qualified Foreign Institutional Investor's (QFII)'s maximum quota from US$800 million to US$1 billion and the shortening of the lock-up period for institutional investors from one year to three months.

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