State Administration of Foreign Exchange, Provisions on Foreign Exchange Control in Connection with Securities Investments in China by Qualified Foreign Institutional Investors

(2) Simplification of the examination, approval and administration of the amount. Applications for amounts falling within a QFII's Basic Amount will be subject to administration by record filing. Approval of the exchange control authority will be required only if the Basic Amount is exceeded.

(3) Further simplification of the outward and inward remittance of funds. The inward remittance of the investment funds of a QFII will no longer be subject to a deadline; QFII open-ended funds will be permitted to effect purchase and redemption on a daily basis.

(4) The lockup period is reduced from one year to three months, the requirement for outward remittance by tranche or by installment is retained and the total amount of funds that a QFII can remit outward per month may not exceed 20% of its assets in China.

Related legislation: Measures for the Administration of Securities Investments in China by Qualified Foreign Institutional Investors; and Provisions on Issues Relevant to the Implementation of the «Measures for the Administration of Securities Investments in China by Qualified Foreign Institutional Investors»

Repealed legislation: Provisions on Foreign Exchange Control in Connection with Securities Investments in China by Qualified Foreign Institutional Investors, 2009; Provisions on Foreign Exchange Control in Connection with Securities Investments in China by Qualified Foreign Institutional Investors (Revised), 2012; and Operational Guidelines on the Administration of the Limits of Qualified Foreign Institutional Investors

See the full translation.

clp reference:3700/16.02.03 promulgated:2016-02-03 effective:2016-02-03

Promulgated: February 3 2016

Effective: as of date of promulgation

Main contents: The revised Provisions relax the policy on the QFII regime:

(1) Relaxation of the upper limit on the amount that a single QFII can invest. A single QFII will no longer be subject to a uniform upper limit on the amount that it can invest, rather a certain percentage of its assets or the assets under its management will serve as the basis for securing the amount that they can invest (Basic Amount).

(2) Simplification of the examination, approval and administration of the amount. Applications for amounts falling within a QFII's Basic Amount will be subject to administration by record filing. Approval of the exchange control authority will be required only if the Basic Amount is exceeded.

(3) Further simplification of the outward and inward remittance of funds. The inward remittance of the investment funds of a QFII will no longer be subject to a deadline; QFII open-ended funds will be permitted to effect purchase and redemption on a daily basis.

(4) The lockup period is reduced from one year to three months, the requirement for outward remittance by tranche or by installment is retained and the total amount of funds that a QFII can remit outward per month may not exceed 20% of its assets in China.

Related legislation: Measures for the Administration of Securities Investments in China by Qualified Foreign Institutional Investors; and Provisions on Issues Relevant to the Implementation of the «Measures for the Administration of Securities Investments in China by Qualified Foreign Institutional Investors»

Repealed legislation: Provisions on Foreign Exchange Control in Connection with Securities Investments in China by Qualified Foreign Institutional Investors, 2009; Provisions on Foreign Exchange Control in Connection with Securities Investments in China by Qualified Foreign Institutional Investors (Revised), 2012; and Operational Guidelines on the Administration of the Limits of Qualified Foreign Institutional Investors

See the full translation.

clp reference:3700/16.02.03 promulgated:2016-02-03 effective:2016-02-03