ARTICLE
9 August 2017

New Opportunity In China Fund Management Market:Door For Foreign Fund Managers To Enter China Market Is Now Open

AL
Allbright Law Office

Contributor

We are one of the leading full-service Chinese law firms in the People’s Republic of China (“PRC”). As the only national law firm headquartered in Shanghai, we provide a comprehensive range of high quality legal services to both domestic and international clients from our two offices in Shanghai and our offices in Beijing, Chengdu, Chongqing, Hangzhou, Hong Kong, Nanjing, Qingdao, Shenzhen, Suzhou, Taiyuan and Xiamen.

While size is only one of many indicators of the success and resourcefulness of a law firm, we certainly lead in this respect among our peers in Shanghai. We are – and we have remained since the creation of our firm via a merger of three law firms with a common vision – the largest law firm based in Shanghai (and in the whole Eastern China region).

In June, 2016, the AMAC announced a new regulation on the registration of foreign-owned private securities investment fund managers, which opens a door for foreign-owned enterprises to enter China's...
China Finance and Banking

In June, 2016, the Asset Management Association of China ("AMAC") announced a new regulation ("AMAC Q&A (X)") on the registration of foreign-owned private securities investment fund managers ("PFM"), which opens a door for foreign-owned enterprises to enter China's private securities investment fund market.

In January, 2017, the AMAC published an Illustrative Guidance for the Registration and Filling of WFOE and Joint Venture Private Securities Investment Fund Managers ("Illustrative Guidance"). The Illustrative Guidance sets out detailed requirements for the registration of foreign-owned PFMs.

Some requirements, inter alia, to obtain a registration for a foreign-owned PFM as follows:

Overseas Financial License: both foreign shareholders and foreign actual controller of the foreign-owned PFM shall be overseas licensed financial institutions;

Legal Opinion on PFM registration: A legal Opinion on PFM registration provided by qualified Chinese law firm and lawyers shall be submitted to the AMAC along with PFM application;

Qualification of the fund practitioners: all of the fund practitioners shall obtain a qualification for practicing fund-related business in China, including senior executives, investment managers, persons-in-charge for investment decision making or trade execution and other practitioners engaging in daily private fund operation and management.

Undoubtedly, it is a great and valuable opportunity for overseas institutions to take part in China fund management market. Taking the unstable financial regulations in China into account, we suggest that overseas institutions should make full use of this opportunity and establish legal entities in China market.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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