Legislation roundup: Investment capital, QFII and insurance companies
December 13, 2019 | BY
Susan MokState Council has lowered the investment capital percentage requirements, the QFII system is streamlined and the entry conditions for foreign insurance companies are relaxed.
Economic Policy
State Council, Circular on Strengthening the Administration of the Investment Capital in Fixed Asset Investment Projects
For port, coastal and inland water transport projects, the minimum investment capital percentage is reduced from 25% to 20%.
The minimum investment capital percentage for airport projects remains unchanged at 25%, and that for other infrastructure projects remains unchanged at 20%. Where the minimum investment capital percentage for projects for making up the weak links in infrastructure in areas such as highways (including government toll highways), railways, urban development, logistics, eco-environmental protection and people's livelihoods may be suitably reduced, provided that such reduction does not exceed 5%.
Further reading
Capital Markets
People's Bank of China and State Administration of Foreign Exchange, Provisions for the Administration of the Domestic Securities Investment Capital of Foreign Institutional Investors (Draft for Comments)
With the removal of investment limits, the Draft combines the capital administration of both qualified foreign institutional investors (QFIIs) and renminbi qualified foreign institutional investors (RQFIIs), subjecting both to just the registration of their domestic investment capital with the State Administration of Foreign Exchange.
The Draft also combines currency administration, QFIIs and RQFIIs may remit their investment capital inward in foreign currencies or renminbi, or both.
Further reading
Insurance
China Banking and Insurance Regulatory Commission, Implementing Rules for the PRC Regulations for the Administration of Foreign-Invested Insurance Companies
The Rules relax the shareholding percentage of the foreign party to a foreign-invested personal insurance company, allowing it to hold up to 51% of the shares, and relax the entry conditions for foreign-invested insurance companies, dropping provisions on "a term of operation of 30 years", "representative office", etc.
With the objective of regulating the administration of the equity of foreign-invested insurance companies, the revised Rules require that a foreign-invested insurance company have at least one insurance company whose operations are regular to serve as a major shareholder and further clarify the responsibilities and obligations of major shareholders, so as to ensure the sustained healthy operation of foreign-invested insurance companies.
See the full translation.
Further reading
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