Fund Management Companies, Securities Companies, Its Domestic Securities Investment By Qualified Foreign Institutional Investors Pilot Approach

Original Language Title: 基金管理公司、证券公司人民币合格境外机构投资者境内证券投资试点办法

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Read the untranslated law here: http://www.chinalaw.gov.cn/article/fgkd/xfg/gwybmgz/201203/20120300362019.shtml

Fund management companies, securities companies, its domestic securities investment by qualified foreign institutional investors pilot approach

    (December 16, 2011 China Securities supervision Management Committee, and people's Bank of China, and safe makes 76th, announced since announced of day up purposes) first article for specification fund management company, and securities company Yuan qualified outside institutions investors using in Hong Kong raised of Yuan funds carried out territory securities investment business pilot of behavior, promote securities market continued health stable development, protection investors lawful rights and interests of, according to about legal and administrative regulations, developed this approach.

    Second approach applies to domestic fund management companies, securities companies, subsidiaries in Hong Kong (hereinafter referred to as Hong Kong subsidiary), used in Hong Kong to raise renminbi funds investing in domestic securities markets.

    Article subsidiaries investment in domestic securities market in Hong Kong by the China Securities Regulatory Commission (hereinafter referred to as the China Securities Regulatory Commission) approval, and the State administration of foreign exchange (hereinafter referred to as foreign exchange) approved by quota.

    Fourth the CSRC to supervise and administer the Hong Kong subsidiaries of domestic securities investment, people's Bank of China (hereinafter referred to as the people's Bank) in accordance with the Hong Kong subsidiaries managed to open a Renminbi bank account, State administration of foreign exchange for Hong Kong's investment management subsidiary, the people's Bank in conjunction with the State administration of foreign exchange to access funds for monitoring and management.

    Article fifth subsidiary in Hong Kong to carry out domestic securities investment business shall entrust a qualified foreign institutional investor qualification of trustee is responsible for the asset management business of commercial banks in the territory, delegate domestic securities company to purchase or sell securities.

    Hong Kong subsidiaries to entrust domestic fund management companies, securities firms to conduct domestic securities investment management.

    Sixth in Hong Kong Hong Kong subsidiaries to raise renminbi funding domestic securities investment business, shall meet the following conditions:

    (A) the securities supervision Department in qualifying made asset management business in Hong Kong and to conduct asset management business, financial soundness, good credit standing;

    (B) effective internal controls and corporate governance, employee compliance with Hong Kong professional qualification requirements;

    (C) the territory of the applicant and the parent company's business code of conduct, the last 3 years not regulators, where significant punishment;

    (D) the parent company, securities and asset management business in qualifications of applicants;

    (V) other conditions stipulated by the CSRC based on prudent regulatory principles.

    Article seventh in Hong Kong Hong Kong subsidiaries to raise renminbi funding domestic securities investment business, shall submit the following materials:

    (A) the application, including the reasons, the basic situation of the applicants, domestic securities investment scheme, and authenticity of the application materials, the accuracy, completeness, compliance with commitments;

    (B) the copies of registration certificates;

    (C) asset management business licenses issued by the Hong Kong securities regulators copies;

    (D) the applicant and the parent company within the last 3 years by local regulatory authorities description of the punishment;

    (E) the principal personnel of the applicant meets the requirements of Hong Kong-related qualification certificates;

    (F) the source of funds and the domestic securities investment plans;

    (VII) the applicant's description of the company's internal control system;

    (H) the previous fiscal year audited financial reports;

    (I) draft custody agreement entered with the domestic custodian;

    (J) legal opinions;

    (11) other documents requested by the CSRC. Article eighth domestic securities investment business of China's securities and Futures Commission of Hong Kong subsidiary audit qualifications, from the date of receiving the complete application documents within 60 days to approve or not to approve the decision.

    Approved by decision will give written approval and issuance of license for securities investment business; decided not to ratify, and notify the applicant in writing.

    Nineth qualified as a securities investment business in subsidiaries in Hong Kong should apply for investment quotas with the following materials to safe:

    (A) the application, including the territory of the applicant and the parent company's basic situation, source notes, domestic securities investment program;

    (B) the securities investment business issued by CSRC license copy;

    (C) the power of Attorney notarized custodian;

    (D) other material foreign exchange requirements. Foreign Exchange received from the Hong Kong subsidiary of the complete application files within 60 days from the date of approval or disapproval decision.

    Approved by decision will give written approval and issuance of registration certificate; decided not to ratify, and notify the applicant in writing.

    Tenth the Hong Kong subsidiary of domestic securities investment business, its domestic custodian shall perform the following duties:

    (A) keep all affiliates managed assets in Hong Kong;

    (B) overseeing Hong Kong subsidiaries of domestic securities investment operations;

    (C) the Hong Kong subsidiary of capital access and other related business;

    (D) in accordance with the provisions of the balance of payments statistics;

    (E) to the CSRC and the people's Bank and foreign exchange related reports and statements submitted;

    (Vi) the China Securities Regulatory Commission, the people's Bank and the national foreign exchange administration according to the principle of prudent supervision of other responsibilities.

    11th Hong Kong subsidiary, the approved investment amount invested in financial instruments, shall comply with the relevant regulatory requirements, investments and the proportions determined by the CSRC and the people's Bank.

    Subsidiary investment bank bonds market in Hong Kong, should be based on the people's Bank regulations.

    12th the Hong Kong subsidiary of domestic securities investment business shall comply with China on shareholding ratio, information disclosure and other legal regulations and other requirements of the relevant regulation.

    Hong Kong subsidiary shall, in accordance with the provisions of the people's Bank, through the custodian bank, to the people's Bank submitted information management system for cross-border RMB cash remittance of RMB funds and other information.

    13th Hong Kong subsidiaries should be in accordance with the relevant requirements of line management of investment funds.

    Hong Kong subsidiaries are renminbi or foreign exchange remitted the principal and return on investment.

    14th the CSRC and the people's Bank and the State administration of foreign exchange can request the Hong Kong subsidiary, domestic custodians, securities companies and other bodies to provide the relevant information on Hong Kong subsidiary, and make the necessary inquiries and inspection.

    15th the Hong Kong subsidiary of one of the following circumstances, should report within 5 business days of the China Securities Regulatory Commission, people's Bank and the national foreign exchange office:

    (A) change the domestic custodian;

    (B) change the heads;

    (C) change of equity structure;

    (D) adjusting registered capital;

    (E) the merger of other institutions;

    (Vi) is involved in material lawsuits and other major events;

    (VII) severely punished outside;

    (VIII) specified by the CSRC and the people's Bank of China and other circumstances.

    16th the Hong Kong subsidiary of one of the following circumstances shall re-apply for a license for securities investment business:

    (A) change of name;

    (Ii) merger by other agencies;

    (C) other circumstances as the China Securities Regulatory Commission and the State Bureau of foreign exchange.

    During the re-apply for a license for securities investment business, affiliates can continue to make portfolio investments in Hong Kong, but the CSRC based on prudent regulatory principles except deems it necessary to suspend.

    17th Hong Kong subsidiary has one of the following situations, securities investment business license and registration certificate should be returned to the issuing authority, respectively:

    (A) the applicant has obtained the securities investment business within 1 year after the license does not apply to the State Bureau of foreign exchange investment quota;

    (B) Organization disbandment, bankruptcy proceedings or by the receiver;

    (C) the CSRC and the people's Bank of China and the State Bureau of foreign exchange in other circumstances.

    18th the Hong Kong subsidiary and the domestic custodian securities investment business in the territory of violations occurred during the pilot, the China Securities Regulatory Commission, the people's Bank and foreign exchange can take appropriate supervisory measures and administrative sanctions according to law. 19th article this way come into force on the date of promulgation.