Circular on Issues Relevant to the Implementation of the «Measures for the Administration of Securities Investments in China by Qualified Foreign Institutional Investors»

关于实施《合格境外机构投资者境内证券投资管理办法》有关问题的通知

The minimum duration of business establishment and assets for QFII status is clearly set out. Limitations on shareholding percentages of securities investments in China by foreign investors are imposed.

Clp Reference: 3700/06.08.24 Promulgated: 2006-08-24 Effective: 2006-09-01

(Issued by the China Securities Regulatory Commission on August 24 2006 and effective as of September 1 2006.)

(中国证券监督管理委员会于二零零六年八月二十四日发布,自二零零六年九月一日起施行。)

Zheng Jian Ji Jin Zi [2006] No.176

証监基金字 [2006] 176号

Offshore investors, custodians, securities companies, the Shanghai Stock Exchange, Shenzhen Stock Exchange and China Securities Depository and Clearing Corporation Limited:

各境外投资者、托管银行、証券公司、上海証券交易所、深圳証券交易所、中国証券登记结算有限责任公司:

With a view to improving the work associated with the pilot qualified foreign institutional investor (QFII) projects, we hereby notify you on issues relevant to the implementation of the Measures for the Administration of Securities Investments in China by Qualified Foreign Institutional Investors as follows:

为进一步完善合格境外机构投资者(以下简称合格投资者)试点工作,现将实施《合格境外机构投资者境内証券投资管理办法》(以下简称《管理办法》)的有关问题通知如下:

1. In order to apply for QFII status, conditions, such as the following asset scales, shall be met:

一、   申请合格投资者资格的,应当达到下列资产规模等条件:

(1) a fund management institution shall have been engaged in the asset management business for at least five years and in the most recent financial year shall have had not less than US$5 billion in securities assets under its management;

(一)  基金管理机构:经营资产管理业务5年以上,最近一个会计年度管理的証券资产不少于50亿美元;

(2) an insurance company shall have been established for at least five years and in the most recent financial year shall have had not less than US$5 billion in securities assets;

(二)  保险公司:成立5年以上,最近一个会计年度持有証券资产不少于50亿美元;

(3) a securities company shall have been engaged in securities business for at least 30 years, have
paid-in capital of not less than US$1 billion and in the most recent financial year shall have had not less than US$10 billion in securities assets under its management;

(三)  証券公司:经营証券业务30年以上,实收资本不少于10亿美元,最近一个会计年度管理的証券资产不少于100亿美元;

(4) a commercial bank, in the most recent financial year, shall have a top 100 world-wide ranking of total assets and not less than US$10 billion in securities assets under its management; or

(四)  商业银行:在最近一个会计年度,总资产在世界排名前100名以内,管理的証券资产不少于100亿美元;

(5) another institutional investor (pension fund, charitable foundation, endowment fund, trust company, government investment management company, etc.) shall have been established for at least five years and in the most recent financial year shall have had not less than US$5 billion in securities assets under its management or held not less than US$5 billion in securities assets.

(五)  其他机构投资者(养老基金、慈善基金会、捐赠基金、信托公司、政府投资管理公司等):成立5年以上,最近一个会计年度管理或持有的証券资产不少于50亿美元。

2. When applying for QFII status, the following application documents shall be submitted to the CSRC (one original and one duplicate):

二、   申请合格投资者资格的,应当向中国証监会报送下列申请文件(一份正本和一份副本):

(1) an application form (Appendix 1);

(一)  申请表 (附件1);

(2) a form listing the basic particulars of the main persons-in-charge (Appendix 2);

(二)  主要负责人员基本情况表(附件2);

(3) an investment plan;

(三)  投资计划书;

(4) an explanation of the source of the funds;

(四)  资金来源说明书;

(5) a statement on whether the applicant has had major penalties imposed by the regulatory authority in the most recent three years;

(五)  最近3年是否受到监管机构重大处罚的说明;

(6) (a photocopy of) the business licence issued by the country or region where it is located;

(六)  所在国家或地区核发的营业执照(复印件);

(7) (a photocopy of) the finance business permit issued by the regulatory authority of the country or region where it is located;

(七)  所在国家或地区监管机构核发的金融业务许可証(复印件);

(8) (a photocopy of) its articles of association;

(八)  公司章程(复印件);

(9) the draft of the custody agreement to be executed with the custodian;

(九)  与托管人签订的托管协议草案;

(10) audited financial statements for the most recent three years; and

(十)  最近3年经审计的财务报表;

(11) other documents required by the CSRC.

(十一) 中国証监会要求的其他文件。

If the documents specified in the preceding paragraph are signed by the authorized representative of the legal representative of the applicant (the term “legal representative” means the natural person, e.g. chairman of the board or chief executive officer, etc., who, as authorized by the board of directors of the applicant or in accordance with the applicant's articles of association or the laws of the country or region where the applicant is located, may represent the applicant in handling matters relating to the administration of securities investments in China by QFIIs), the power of attorney issued to the authorized representative by the legal representative shall be presented.

      前款规定的文件,由申请人的法定代表人(法定代表人是指经申请人董事会授权或按申请人公司章程规定或者符合申请人所在国家或者地区法律规定,可以代表申请人办理合格投资者境内証券投资管理有关事宜的自然人,如董事会主席或者首席执行官等)的授权代表签署的,应当出具该法定代表人对其授权代表的授权委托书。

The power of attorney and the documents specified in Items (6), (7) and (8) of the first paragraph shall require a notarial certificate issued by a notary office or lawyer statutorily recognized by the country or region where the applicant is located or authentication by the embassy or consulate of the People's Republic of China in such country. Any of the documents specified in Items (3), (4) and (5) of the first paragraph written in a foreign language shall be accompanied with a Chinese translation.

      该授权委托书以及第一款规定的第(六)、(七)、(八)项文件须经申请人所在国家或地区法定认可的公証机构或律师出具公証书,或经中华人民共和国驻该国的使、领馆认証。第一款规定的第(三)、(四)、(五)项文件凡用外文书写的,应当附有中文译本。

The applicant shall submit the formal custodian agreement to the CSRC within five working days after the opening of its special renminbi accounts.

      申请人应当在人民币特殊账户开立后5个工作日内向証监会报送正式托管协议。

3. The securities investment business permit of a QFII shall be valid in perpetuity, unless otherwise specified in laws or regulations or by the CSRC or the CSRC revokes its permit in accordance with the law.

三、   合格投资者証券投资业务许可証长期有效,法律法规或者中国証监会另有规定以及中国証监会依法取消其証券投资业务许可証的除外。

4. When applying for QFII custodian status, the following application documents shall be submitted to the CSRC (one original and one duplicate):

四、   申请合格投资者托管人资格的,应向中国証监会报送下列文件(一份正本和一份副本):

(1) an application form (Appendix 3);

(一)  申请表(附件3);

(2) custodian status application (bearing the applicant's official seal or signed by its legal representative);

(二)  托管人资格申请书(须加盖公章或由法定代表人签字);

(3) (a photocopy of) the official reply indicating that the China Banking Regulatory Commission consents to the applicant's engagement in the custodial service for securities investments in China by QFIIs;

(三)  中国银监会同意申请人开办合格投资者境内証券投资托管业务的批复(复印件);

(4) (a photocopy of) the duplicate of the applicant's finance business permit and (a photocopy of) the duplicate of its business licence;

(四)  金融业务许可証副本(复印件)及营业执照副本(复印件);

(5) proof of its paid-in capital;

(五)  实收资本証明文件;

(6) basic particulars of its domestic custody department (including human resources, security assurance measures, etc.);

(六)  境内托管部门基本情况(包括人员配备、安全保障措施等);

(7) management rules and regulations for the custody business (mainly including the custody business management measures, internal risk control system, job responsibilities and operating rules, employees' code of conduct, accounting measures and information system management system, etc.);

(七)  有关托管业务的管理制度(主要包括托管业务管理办法、内部风险控制制度、岗位职责与操作规程、员工行为规范、会计核算办法以及信息系统管理制度等);

(8) an explanation of having an efficient, rapid, secure and reliable technical system and the relevant supporting documentation; and

(八)  拥有高效、快速、安全、可靠技朮系统的说明及有关証明;

(9) other documents required by the CSRC and SAFE in line with the requirements of prudent regulatory principles.

(九)  中国証监会、国家外汇局根据审慎监管原则要求的其他文件。

5. The custodian of a QFII must be replaced if:

五、   合格投资者托管人出现下列情形之一的,须予以更换:

(1) the QFII has sufficient reason to believe that replacing the custodian would be in its interests; or

(一)  合格投资者有充分理由认为更换托管人更符合其利益的;

(2) the CSRC and/or SAFE determine(s), in line with prudent regulatory principles, that the custodian cannot continue to perform its custodial duties and responsibilities.

(二)  中国証监会、国家外汇局根据审慎监管原则,认定托管人不能继续履行托管人职责的。

The incoming and outgoing custodians shall report relevant information to the CSRC and SAFE for the record within three working days after the outgoing custodian finishes its service.

      新任托管人、原任托管人应当在原任托管人退任后3个工作日内将有关情况报中国証监会、国家外汇局备案。

6. A QFII shall appoint its custodian to apply to the China Securities Depository and Clearing Corporation Limited (CSDC) to open several securities accounts. The securities accounts applied for shall correspond one-to-one with the special renminbi accounts approved by SAFE.

六、   合格投资者应当委托托管人向中国証券登记结算有限责任公司(以下简称中国结算公司)申请开立多个証券账户,申请开立的証券账户应当与国家外汇局批准的人民币特殊账户一一对应。

The QFII shall open and use its securities accounts in accordance with the operational rules of the CSDC and be responsible for management of such accounts.

      合格投资者应当按照中国结算公司的业务规则,开立和使用証券账户,并对其开立的証券账户负管理责任。

7. A QFII shall apply to open securities accounts in its own name. If it provides asset management services to customers, it shall open nominal holder accounts. The QFII shall report on the investments of the beneficial owners of the nominal holder accounts in accordance with requirements (Appendix 4).

七、   合格投资者应当以自身名义申请开立証券账户。为客户提供资产管理服务的,应当开立名义持有人账户。合格投资者应按要求报告名义持有人账户内权益拥有人的投资情况(附件4)。

8. When a QFII applies to open a securities account for long-term funds under its management, such as a public foundation, insurance capital, pension fund, charitable foundation, endowment fund and government investment funds, the account name may be in the form “QFII + fund (or insurance capital, etc.).” The account assets shall vest in the “fund (insurance capital, etc.)” and be independent from the QFII and custodian.

八、   合格投资者为其管理的公募基金、保险资金、养老基金、慈善基金、捐赠基金、政府投资资金等长期资金申请开立証券账户时,账户名称可以设置为“合格投资者+基金(或保险资金等)”。账户资产属“基金(保险资金等)”所有,独立于合格投资者和托管人。

9. A QFII may invest in the following renminbi-denominated financial instruments within its approved investment limit:

九、   合格投资者在经批准的投资额度内,可以投资于下列人民币金融工具:

(1) shares listed and traded on a stock exchange;

(一)  在証券交易所挂牌交易的股票;

(2) bonds listed and traded on a stock exchange;

(二)  在証券交易所挂牌交易的债券;

(3) securities investment funds;

(三)  証券投资基金;

(4) warrants listed and traded on a stock exchange; and

(四)  在証券交易所挂牌交易的权証;

(5) other financial instruments permitted by the CSRC.

(五)  中国証监会允许的其他金融工具。

A QFII may participate in new share offerings, offerings of convertible bonds and subscriptions to subsequent offerings and rights issues.

      合格投资者可以参与新股发行、可转换债券发行、股票增发和配股的申购。

10. The securities investments in China by offshore investors shall comply with the following limitations on shareholding percentages:

十、   境外投资者的境内証券投资,应当遵循下列持股比例限制:

(1) the shares of a listed company held by a single offshore investor through a QFII may not exceed 10% of the company's total shares; and

(一)  单个境外投资者通过合格投资者持有一家上市公司股票的,持股比例不得超过该公司股份总数的10%;

(2) the total of the holdings of the A shares of a single listed company by all offshore investors may not exceed 20% of such company's total shares.

(二)  所有境外投资者对单个上市公司A股的持股比例总和,不超过该上市公司股份总数的20%。

If an offshore investor makes a strategic investment in a listed company pursuant to the Measures for the Administration of Strategic Investments in Listed Companies by Foreign Investors, its strategic investment shareholding shall not be subject to the aforementioned limitations.

      境外投资者根据《外国投资者对上市公司战略投资管理办法》对上市公司战略投资的,其战略投资的持股不受上述比例限制。

11. If the securities investments in China by an offshore investor reaches a level that triggers information disclosure requirements, as a party with an information disclosure obligation, it shall disclose information to the stock exchange through the QFII. The QFII is under obligation to ensure that the offshore investors under its name strictly abide by relevant provisions on information disclosure.

十一、 境外投资者的境内証券投资达到信息披露要求的,作为信息披露义务人,应通过合格投资者向交易所提交信息披露内容。合格投资者有义务确保其名下的境外投资者严格履行信息披露的有关规定。

12. A QFII may itself exercise or appoint its custodian, a domestic securities company, the secretary of the board of directors of the listed company in question, an independent director of the listed company in question or an offshore investor under its name to exercise its shareholder's rights.

十二、 合格投资者可以自行或委托托管人、境内証券公司、上市公司董事会秘书、上市公司独立董事或其名下的境外投资者等行使股东权利。

13. When a QFII is to exercise its shareholder's rights, it shall present the following supporting documents to the listed company:

十三、 合格投资者行使股东权利时,应向上市公司出示下列証明文件:

(1) the original or a photocopy of its securities investment business permit;

(一)  合格投资者証券投资业务许可証原件或者复印件;

(2) the original or a photocopy of its securities account card;

(二)  証券账户卡原件或复印件;

(3) the proof of identity of the person who will actually exercise the rights; and

(三)  具体权利行使人的身份証明;

(4) if the QFII has authorized another party to exercise its shareholder's rights, a power of attorney signed by the authorized representative shall be provided in addition to the aforementioned materials (if the QFII authorizes an offshore investor under its name to exercise its shareholder's rights, it shall provide an appropriate shareholding statement signed by the QFII's authorized representative).

(四)  若合格投资者授权他人行使股东权利的,除上述材料外,还应提供授权代表签字的授权委托书(合格投资者授权其名下境外投资者行使股东权利的,应提供相应的经合格投资者授权代表签字的持股说明)。

14. A QFII, as a nominal holder, may, based on the shareholdings of the offshore investors under its name, cast part of the votes or divide its votes.

十四、 合格投资者作为名义持有人,可以根据其名下境外投资者的持股进行部分或分拆投票。

15. Each QFII may appoint three domestic securities companies to carry out securities trading on the Shanghai Stock Exchange and three on the Shenzhen Stock Exchange.

十五、 每个合格投资者可分别在上海、深圳証券交易所委托3家境内証券公司进行証券交易。

16. This Circular shall be effective as of September 1 2006.

十六、 本通知自2006年9月1日起施行。

Appendices:

附件:

1. Application form for the status of qualified foreign institutional investor

1.    合格境外机构投资者资格申请表

2. Form listing the basic particulars of the main persons in charge

2.    主要负责人员基本情况表

3. Application for qualifications to act as a custodian for qualified foreign institutional investors

3.    合格境外机构投资者托管人资格申请表

4. Quarterly statement for nominal holder accounts (contents and format)

clp reference:3700/06.08.24(2)prc reference:证监基金字 [2006] 176 号promulgated:2006-08-24effective:2006-09-01

4.    名义持有人账户季度报表(内容及格式)

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