CHINA: CSRC to amend rules on ownership of China foreign invested securities companies

Monday October 1 2012

On 24th August 2012, the China Securities Regulatory Commission issued draft amendments to the Rules for the Establishment of Securities Companies with Foreign Equity Participation in connection to China foreign invested securities companies. The public was allowed to submit comments on the draft until 22nd September 2012.

Under the draft amendments, the aggregate China foreign investment limit in a Sino-foreign equity securities company will be increased from 33% to 49%. In addition, the amendments provide that, among all domestic shareholders of a Sino-foreign securities joint venture, there must be a domestic securities company which holds no less than 49% equity or rights and interests of the joint venture. In the case of a domestic securities company converted into a Sino-foreign securities joint venture, there must be a domestic shareholder which holds no less than 49% shares of the joint venture.

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