Caps on foreign ownership of Chinese securities firms will be removed on December 1, 2020. Image: iStock

The China Securities and Regulatory Commission has issued draft rules that will combine QFII and RQFII, two existing schemes for foreign institutional investors to invest directly in Mainland China’s bond and equity markets, The Paper reported.

The regulator has integrated relevant supporting regulatory provisions to form unified “administrative measures” and “implementation regulations,” and the draft rules are currently open to public opinion.

Foreign investors will also be allowed to invest in A-shares listed on the New Third Board, private equity investment funds, financial futures, commodity futures and options, and will be able to conduct bond repurchase as well as margin trading, thus expanding the scope of investment.

The new rules also state that access will be relaxed, as the regulator will cancel quantitative requirements but keep compliance requirements. It has also pledged to simplify the application document and shorten the time for approval.

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