China Securities Regulatory Commission, Implementing Rules for the Pooled Asset Management Business of Securities Companies
中国证券监督管理委员会证券公司集合资产管理业务实施细则
January 10, 2013 | BY
clpstaff &clp articles &Scope of investment of pooled asset management plans of securities companies expanded.
Promulgated: October 18 2012
Effective: as of date of promulgation
Main contents: The proceeds raised for a pooled asset management plan shall be used to invest in stocks, bonds, securities investment funds, central bank notes, short-term financing bills, asset-backed securities, medium-term notes and financial derivatives such as stock index futures lawfully issued in the PRC, guaranteed return and guaranteed principal-variable return wealth management plans of commercial banks as well as other investment products approved by the CSRC.
Pooled plans may participate in margin trading and may lend securities that they hold to securities financing companies as the underlying securities for such lending.
A securities company may lawfully establish a pooled plan to raise funds in the PRC and invest them in overseas financial products approved by the CSRC (Article 14).
The proceeds raised for a limited specific asset management plan may be used to invest in the investment products specified in Article 14, investment products traded on a securities or futures exchange such as commodities futures, investment products traded on the interbank market such as forward rate agreements and interest rate swaps, financial products, such as dedicated asset management plans of securities companies, wealth management plans of commercial banks and pooled fund trust plans, the issuance of which has been approved or placed on the record by the financial regulator as well as other investment products approved by the CSRC.
For the purposes of the preceding paragraph, the term “limited specific asset management plan” means a pooled asset management plan that satisfies the following conditions:
(1) proceeds raised of less than Rmb5 billion;
(2) the amount contributed by any one client being not less Rmb1 million; and
(3) fewer than 200 clients participating, without, however, any limit on clients that entrust at least Rmb3 million (Article 15).
The promotion of pooled plans on television, in newspapers and periodicals, on the radio and through other public media is prohibited. The promotion of pooled plans through means such as the execution of supplementary agreements guaranteeing principal and minimum returns is prohibited (Article 21).
The following conditions shall be satisfied for a pooled plan to be established:
(1) for limited specific asset management plans, proceeds of not less than Rmb30 million raised, and for other pooled plans, proceeds of not less than Rmb100 million; and
(2) having at least two clients (Article 28).
The securities issued by one company held by any one pooled plan may not exceed 10% of the net value of the plan assets, except in the case of pooled plans that invest in index funds.
When a securities company invests pooled plan assets under its management in the securities issued by a company, it may not exceed 10% of the total outstanding number of such securities (Article 35).
When a pooled plan participates in a securities buyback, the balance of funds raised may not exceed 40% of the net value of the plan assets, unless otherwise provided by the CSRC (Article 36).
Repealed legislation: Implementing Rules for the Pooled Asset Management Business of Securities Companies, May 31 2008
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