The State Council has just issued a directive which further loosens restrictions on the activities of foreign-invested financial institutions in China.
On 7 November the State Council issued the “Opinions on Work for Further Making Effective Usage of Foreign Capital” (关于进一步做好利用外资工作的意见).
The Opinions outline a range of measures for further opening China’s financial sector under Article I, paragraph (ii), including:
- Comprehensive cancellation of restrictions on the business scope of foreign-invested banks, securities companies, fund companies and other financial institutions;
- Reducing quantitative entry conditions for foreign investors to invest in the establishment of banking sector and insurance sector financial institutions, and undertake related operations;
- Cancellation of total asset requirements for the establishment of foreign invested legal person banks and branch banks by foreign banks in China;
- Cancellation of operating term and total asset requirements for foreign insurance brokerages that engage in insurance brokerage operations in China;
- Expansion of the shareholder scope for investment in the shares of foreign invested banks and foreign invested insurance institutions;
- Cancellation of the requirement that the sole or main Chinese shareholder in Sino-foreign joint-venture banks be a financial institutions;
- Allowing foreign insurance groups to invest in and establish insurance organisations;
- In 2020, the cancellation of the 51% restriction on foreign ownership of securities companies, securities investment fund management companies, futures companies and life insurance companies.