Recruiting in China

SHANGHAI -- China has fulfilled its commitment to the World Trade Organization to open its securities market, China Securities Regulatory Commission chairman Shang Fulin has told the Sino-French Financial Forum in Shanghai.

Since beginning of this year, the government had taken a series of measures to further open its capital market, he said.

In February, the regulations on foreign strategic investment in Chinese-listed companies started to take effect, allowing overseas investors to put long-term investment into listed companies, Shang said.

Regulators had also relaxed QFII (qualified foreign institutional investors) rules to attract more overseas investment to the securities market, he said.

Slashing the QFII threshold, the new regulations made it possible for more overseas foreign institutional investors to qualify as investors in the Chinese A-share (Renminbi-dominated) markets, he said.

The rules, which came into effect on September 1, stipulate the minimum securities assets managed by QFII applicants -- such as fund management institutions, insurance companies and other institutions that stress long-term investment -- as five billion US dollars for the current fiscal year, half the earlier QFII provisions.

Insurance companies must exist for at least five years to become a QFII, a much shorter period than the 30 years in the previous rules.

QFIIs will be allowed to open three securities investment accounts with each of the country's two stock exchanges. Under the old rules, they could only hold one account with each stock exchange in cooperation with their trustees and local partners.

By the end of August, seven joint-venture securities companies and 23 joint-venture fund management companies had been established in China.

Foreign investors hold at least 40 percent of equity in nine fund management firms, and overseas securities agencies had been allowed to deal directly in China's B-share (overseas currency dominated) market, he said.