Further to our newsletter article of December 2017 on China to relax foreign shareholding limits in financial services sectors, from 9 March 2018 until 8 April 2018, the China Securities Regulatory Commission (CSRC) engaged in a public consultation on the Draft Administrative Measures for Foreign-invested Securities Companies (Draft).

The Draft proposes that foreign investors’ equity ownership in PRC securities companies shall be subject to a cap, which is initially proposed to be set at 51% but is to be increased over time with the pledge that such cap shall be removed after three years.

The Draft, once adopted, will allow foreign investors to be majority shareholders in PRC securities companies.