Economic Observer Online
May 22, 2012
Translated by Tang Xiangyang
Original article: [Chinese]

 
The stock market regulator has decided to loosen the restrictions imposed on certain non-Chinese investors allowing them to hold less than 50 percent of their portfolio in equities for the first time, said Wang Lin, director of the regulator’s invetsment fund department.   

The changes relate to foreign funds registered under the Qualified Foreign Institutional Investors (QFII) program. The China Securities Regulatory Commission will now let multiple institutions from the same group hold QFII licenses. The commission will also suggest that the State Administration of Foreign Exchange raises their investment quota, as long as the extra allowance isn’t invested in structural products.

The funds will still be barred from holding more than 20 percent of their portfolio in cash or investing in overseas hedge funds.

Wang Lin also said that CSRC is considering other measures, including lowering the threshold of QFII application, allowing each license holder to invest more than $1 billion and lessening the restrictions on capital transfer.