China Equity Strategy: Tighter capital rules positive for the A-share market

Research evidence excerpt

China Equity Strategy: Tighter capital rules positive for the A-share market

nTech are required to rectify their illegal and non-compliant activities:

China Securities ◆ Soliciting domestic investors, acquiring new domestic clients and opening new accounts are prohibited for illegal activities;

30 Dec 2022 Regulatory ◆ Existing domestic investors are allowed to continue conducting transactions through the original overseas institutions;

Commission (CSRC) however, overseas institutions are prohibited from accepting incremental funds that violate China’s foreign exchange

administration rules into the accounts of such investors.

China Securities Regulatory meeting with senior management of Futu Holdings and UP FinTech, requiring them to standardise their cross-border

11 Nov 2021 Regulatory securities businesses targeting onshore investors in accordance with laws and regulations. Commission (CSRC)

Administrative Measures for Outbound Investment by Enterprises National Development ◆ Outbound investment includes: 1) establishing new overseas companies or increasing capital contributions to existing26 Dec 2017 and Reform

overseas companies; 2) initiating or subscribing to overseas equity investment funds; and 3) controlling overseas companies Commission (NDRC) or assets through means, such as agreements and trusts.

Guidance on Further Directing and Regulating Overseas Investment Direction

◆ Prioritise the advancement of overseas infrastructure investments that facilitate the Belt and Road Initiative and the

General Office of the interconnection of infrastructure with neighbouring regions;

4 Aug 2017 State Council ◆ Strengthen investment cooperation with overseas high-tech and advanced manufacturing companies, and encourage the

establishment of overseas R&D centres;