Foreign investors allowed to hold controlling stakes in financial firms

Foreign investors directly or indirectly investing in securities, fund management or futures companies will be allowed to hold no more than 51% of the stake, said Zhu Guangyao, the deputy Minister of Finance, Yicai.com reported.

Zhu further pointed out that there will be no more restrictions on the investment ratio, three years after the new rule has taken effect.

Insiders think this is expected to enhance the initiative of foreign investors to expand their investment in Chinese business.

However, they will also face the challenge of how to speed up the process of adapting to the domestic regulatory system, and how to realize new breakthroughs in the full competitive landscape.

So far, there are seven Sino-foreign joint venture brokerage firms, namely CICC, UBS Securities, Citi Orient, Morgan Stanley Huaxin, Goldman Sachs Gao Hua, Sino-German Securities and Credit Suisse Founder.

(ASIA TIMES)