Foreign Strategic Investment in a PRC Domestic Bank

Driven by the desire to gain a better position before China fully opens its banking sector according to its WTO commitment, and encouraged by several precedents completed in the past few years, foreign investment in the PRC banking sector by making equity investment into existing domestic Chinese banks is increasingly popular. What is the legal and regulatory framework for these kinds of transactions?

A PRC domestic bank may take the form of a limited liability company (LLC) or a company limited by shares (CLS). A CLS may be a listed company or a non-listed company. Currently no PRC banks have shares listed overseas.