Legislation roundup: Petrochem FDI, private funds and interbank FX

See the digest for more details.

Further reading

Provisions for the Acquisition of Domestic Enterprises by Foreign Investors (Revised)

Provisions for the Implementation of the System for Security Review of Acquisition of Domestic Enterprises by Foreign Investors

Going global

Capital Markets

China Securities Regulatory Commission, Tentative Provisions for the Administration of the Operation of Private Asset Management Business of Securities and Futures Firms

中国证券监督管理委员会证券期货经营机构私募资产管理业务运作管理暂行规定

A securities or futures firm may not engage or participate in private asset management business that has the nature of a “capital pool”, and an asset management plan may not mix its operation with another asset management plan such that it is impossible to make a clear one to one connection between capital and assets.

See the digest for more details.

Further reading

Measures for the Administration of the Offering of Private Investment Funds

Tentative Measures for the Regulation of Private Investment Funds

China Foreign Exchange Trading System, Circular on Matters Relevant to Strengthening the Macroprudential Administration of the Entry into the Interbank Foreign Exchange Market by Foreign Financial Institutions to Conduct Renminbi Purchase and Sale Business

中国外汇交易中心关于加强境外金融机构进入银行间外汇市场开展人民币购售业务宏观审慎管理有关事项的通知

Commencing from August 15, 2016, once the position derived from the forward exchange sale business conducted by a foreign financial institution, that has entered the interbank foreign exchange market, with a customer abroad is unwound on the interbank foreign exchange market, it shall pay into an exchange risk reserve on a monthly basis based on the amount unwound in the preceding month. The reserve ratio shall be 20% and the reserve interest rate shall be 0.

See the digest for more details.

Further reading

People's Bank of China, Announcement [2015] No.31

People's Bank of China and State Administration of Foreign Exchange, Announcement [2015] No.40

Foreign Investment

General Office of the State Council, Guiding Opinions on Adjusting the Structure, Promoting the Transformation and Enhancing the Achievements of the Petrochemical Industry

国务院办公厅关于石化产业调结构促转型增效益的指导意见

The participation of foreign investors in the merger and restructuring of domestic petrochemical enterprises is encouraged, and the launching of multinational operations by large Chinese petrochemical enterprises is supported, provided that they duly prepare risk contingency plans in advance.

See the digest for more details.

Further reading

Provisions for the Acquisition of Domestic Enterprises by Foreign Investors (Revised)

Provisions for the Implementation of the System for Security Review of Acquisition of Domestic Enterprises by Foreign Investors

Going global

Capital Markets

China Securities Regulatory Commission, Tentative Provisions for the Administration of the Operation of Private Asset Management Business of Securities and Futures Firms

中国证券监督管理委员会证券期货经营机构私募资产管理业务运作管理暂行规定

A securities or futures firm may not engage or participate in private asset management business that has the nature of a “capital pool”, and an asset management plan may not mix its operation with another asset management plan such that it is impossible to make a clear one to one connection between capital and assets.

See the digest for more details.

Further reading

Measures for the Administration of the Offering of Private Investment Funds

Tentative Measures for the Regulation of Private Investment Funds

China Foreign Exchange Trading System, Circular on Matters Relevant to Strengthening the Macroprudential Administration of the Entry into the Interbank Foreign Exchange Market by Foreign Financial Institutions to Conduct Renminbi Purchase and Sale Business

中国外汇交易中心关于加强境外金融机构进入银行间外汇市场开展人民币购售业务宏观审慎管理有关事项的通知

Commencing from August 15, 2016, once the position derived from the forward exchange sale business conducted by a foreign financial institution, that has entered the interbank foreign exchange market, with a customer abroad is unwound on the interbank foreign exchange market, it shall pay into an exchange risk reserve on a monthly basis based on the amount unwound in the preceding month. The reserve ratio shall be 20% and the reserve interest rate shall be 0.

See the digest for more details.

Further reading

People's Bank of China, Announcement [2015] No.31

People's Bank of China and State Administration of Foreign Exchange, Announcement [2015] No.40