SHANGHAI Jan 23 China will amend its laws and
regulations so as to gradually open its securities and futures
industries to foreign financial institutions, its top stock
regulator said, without giving a specific timetable.
China will aim to abolish limits on the size of stakes
foreign firms can take in Chinese securities institutions and
permit them to set up wholly owned entities and branches, Xiao
Gang, Chairman of the China Securities Regulatory Commission,
said in speech published in the regulator's website,
www.csrc.gov.cn, late on Wednesday.
It will also aim to lift business restrictions on
Sino-foreign joint venture securities houses, Xiao told the
annual meeting on securities and futures work for 2014.
China currently limits foreign firms to hold up to a 49
percent stake in joint venture securities houses, and tightly
limits the activities those joint ventures may engage in, in
particular a ban on underwriting business.
Xiao also repeated in the speech that the CSRC is planning
to move towards a registration-based system for initial public
offerings from the current approval system, but added that the
process would be gradual.
January saw Chinese IPOs resume for the first time in more
than a year, but multiple firms subsequently suspended their
applications following criticism that the proposed listings were
priced was too high and appeared to be intended to allow
management teams to cash out their existing stakes at a premium.
Chinese bourses have been some of the world's worst
performing equities markets in recent years, still down around
60 percent from a peak in 2007, and the resumption of IPOs has
proved a fresh headache for regulators who are trying to both
liberalise the system for long-term benefit while restoring
confidence to improve short-term performance.
Unfortunately for both regulators and listed Chinese firms,
the resumption of IPOs has further hammered domestic stock
indexes, knocking 10 percent off the CSI300 Index that
tracks China's largest listed firms since early December.
On Wednesday a U.S. judge ruled that the Chinese units of
"Big Four" accounting firms should be suspended from practicing
in the United States, putting up an additional barrier to
Chinese companies hoping to list overseas.
(Reporting by Lu Jianxin and Pete Sweeney; Editing by Chris