BEIJING Aug 7 China International Capital Corp.
(CICC), about one-third owned by Morgan Stanley (MS.N), has
become the first brokerage to receive a licence under China's
Qualified Domestic Institutional Investor (QDII) scheme, market
sources said on Tuesday.
The China Securities Regulatory Commission announced in June
that fund managers and brokerages would be permitted to invest
client money overseas under the QDII programme.
Since then, China Asset Management Co. Ltd., China's largest
mutual fund company, and three other funds have received licences
from the regulator.
The sources did not know whether CICC had yet received an
investment quota from the currency regulator, the State
Administration of Foreign Exchange -- the last step in the
Since QDII was launched in April 2006 as a way of spurring
capital outflows and trimming China's balance-of-payments
surplus, only one fund manager, Huaan Fund Management Co., had
been allowed to take part in the programme on a pilot basis
before the rules were revised in June.
Authorised firms may invest in equities in the 33
jurisdictions that have signed agreements with the Chinese
regulator, including Hong Kong, the United States, Britain, Japan
The regulator also allows brokerages and fund managers to
invest client funds in fixed-income products including government
and corporate debt, commercial bills, mortgage-backed securities
and structured products.
Banks and insurers have also been given the green light to
participate in the QDII scheme.