CHINA: CSRC announces rise in total investment quota of China QFII regime and further expansion of China RQFII pilot regime

Tuesday July 23 2013

The China Securities Regulatory Commission, the People’s Bank of China and the State Administration of Foreign Exchange have made a joint decision to raise the total investment quota of the qualified foreign institutional investors (QFII) programme from USD 80 billion to USD 150 billion and expand the renminbi qualified foreign institutional investors (RQFII) pilot regime to Singapore and London.

Under the current regime, RQFII funds must invest primarily in renminbi bonds and bond funds issued in mainland China. Such investment must consist of at least 80% of the fund`s assets. RQFII funds may also invest in China A-shares and other equity investments permitted under RQFII regulations but such investment cannot exceed 20% of the fund`s assets.

The reforms are hoped to attract longer term foreign investment and promote the development of capital market reform. It has also been noted that the RQFII pilot programmes in Taiwan, Singapore and London will be implemented by reference to the current rules applicable to the Hong Kong RQFII programme.

Please click on the above link for the CSRC announcement (Chinese).