The Chinese central government has rescinded the ceiling on investments levels for overseas institutional investors.
The State Administration of Foreign Exchange (SAFE) announced on 10 September that it had removed the investment quota restriction on qualified foreign institutional investors (QFII’s) and renminbi qualified foreign institutional investors (RQFII’s).
In future QFII’s will be permitted to freely remit funds into China to undertake compliant securities investments following the completion of registration procedures.
SAFE spokesperson and chief economist Wang Chunying (王春英) said that the next step will be for SAFE to immediately amend relevant laws and regulations, to clarify that filing and approval of the investment quotas of individual QFII’s will no longer be required.
The QFII system was first launched in 2002, followed by RQFII’s in 2011. At present over 400 institutional investors from 31 countries and regions around the world have invested in China’s financial markets via the QFII and RQFII schemes.