Xinhua News Agency, Beijing, October 31 (China Securities Journal reporter Huang Lingling and Huang Yiling) After the new regulations on QFII and RQFII are implemented, the new version of the exchange's implementation details have also come.
On October 30, the Shanghai and Shenzhen Stock Exchanges issued the newly revised implementation rules for QFII and RQFII, which will come into effect on November 1. The revision mainly includes:
expanding the investment scope, adding new permissions to qualified overseas investors to invest in depositary receipts, stock options, government-supported bonds, etc., allowing qualified overseas investors to participate in bond repurchase, margin financing, and transfer and securities lending transactions; improving the disclosure of shareholding ratios and over-proportion reduction arrangements, adjusting the disclosure indicators of foreign-funded shareholding ratios from 26% to 24%; optimizing matters related to position and closing positions, and improving relevant handling methods for foreign-funded shareholdings in the case of a total of more than 30% of foreign investors; facilitating investment operations, modifying information reporting requirements, and improving relevant regulations on non-transaction transfer; strengthening continuous supervision and strengthening compliance requirements.
(picture description) Picture source: Shanghai Stock Exchange official website
(picture description) Picture source: Shenzhen Stock Exchange official website
Shanghai Stock Exchange stated that it will continue to promote the improvement of the system and mechanism of high-level two-way opening of my country's capital market, improve the convenience of foreign capital participation in the A-share market, and attract more medium- and long-term funds to enter the market.
Wind data shows that at present, there are 337 qualified overseas institutional investors (QFII) and 278 RMB qualified overseas institutional investors (RQFII) in my country. According to Shouchuang Securities data, as of September 28, 2020, the total market value of QFII/RQFII held by A shares was RMB 195.727 billion, accounting for 0.34% of the circulating market value of A shares.
analysis points out that with the steady advancement of financial market opening up to the outside world, overseas capital still has a large growth space and growth momentum for entering China.
CICC predicts that in the next 5 to 10 years, the proportion of foreign capital in the total market value of A-shares will increase to 5% to 10%, and the average annual net inflow of foreign capital into A-shares is expected to be between 200 billion and 400 billion yuan. The initial disclosure ratio of
(sub-title) shares was lowered to 24%
Qualified Overseas Institutional Investors (QFII) and RMB Qualified Overseas Institutional Investors (RQFII) systems were implemented in 2002 and 2011 respectively. The Shanghai and Shenzhen Stock Exchanges stated that in order to better meet the needs of overseas investors and promote the coordinated development of different open channels, the implementation rules were revised, and the modification content was mainly:
1. Expand the investment scope
In addition to the original varieties, qualified overseas investors can invest in depositary receipts, stock options, government-supported bonds, etc.; at the same time, qualified overseas investors are allowed to participate in margin trading, securities lending transactions, and bond repurchase transactions.
2. Adjust the initial disclosure ratio of foreign holdings
When all overseas investors hold A-share shares of the same listed company in total or exceed a certain proportion, the Shanghai Stock Exchange will announce the total number of shares they have held in the company and the proportion of the total number of shares of the company. The initial disclosure ratio was reduced from 26% to 24%.
According to relevant regulations, the total of A-shares or domestic listed shares held by all overseas investors shall not exceed 30% of the total number of shares of the company. In order to remind overseas investors that the proportion of shares held by a single listed company is about to reach the upper limit, the exchange has set the initial disclosure ratio of foreign holdings.
Shanghai and Shenzhen Stock Exchanges said that in recent years, as A-shares are included in important international indexes such as MSCI and FTSE Russell, overseas investors' enthusiasm and confidence in investing in A-shares has been increasing. During the communication with overseas investors and financial institutions, many investors and institutions proposed that they hope to understand the overall shareholding level of foreign capital in listed companies in a timely manner so that they can have more time to respond.
3. Optimization of positions and closing matters related to positions
clearly states that due to the reduction of registered capital of listed companies, all qualified overseas investors and other overseas investors have passively held more than 30% of the total shareholding ratio, qualified overseas investors and other overseas investors can continue to hold the original shares, but they cannot continue to increase their shareholdings until the total shareholding ratio of all qualified overseas investors and other overseas investors is less than 30%.
At the same time, the order of closing positions when the total holdings of overseas investors exceed the limited proportion is optimized, and the situation where they can apply to continue to hold relevant shares after being notified to reduce their holdings.
4. Convenient investment operation
clarifies the processing requirements for the transfer of qualified overseas investors and non-transaction transfer: If the qualified overseas investors transfer shares held by the listed company in an agreement, the relevant business rules for the transfer of the listed company's share agreement shall be handled in accordance with the relevant business rules for the transfer of the listed company's share agreement.
If qualified overseas investors change the business entity under the same control, adjust the account arrangements of the same qualified overseas investors, and change the manager of the fund products or account, which helps improve investment operation efficiency or clarify the account structure, they can handle non-transaction transfer of securities in accordance with the relevant regulations of the securities registration and settlement institution.
5. Strengthen compliance requirements
clarifies the requirements for the management of trading behavior of entrusted securities companies and entrusted futures companies for qualified overseas investors and suspected illegal and irregular transaction reports; clarify the requirements for qualified overseas investors to urge overseas investors under their names to fulfill their information disclosure obligations; add new inspectors' supervision responsibilities for qualified overseas investors, etc.
(subtitle) The entry speed of foreign investment may further accelerate
0. On September 25, the China Securities Regulatory Commission, the People's Bank of China, and the State Administration of Foreign Exchange issued the "Regulations on the Management of Domestic Securities and Futures Investment of Qualified Foreign Institutional Investors and RMB Qualified Foreign Institutional Investors" (hereinafter referred to as the "Measures"). The main revisions include unifying the QFII/RQFII system, relaxing access conditions, simplifying application review procedures, expanding investment scope, and strengthening the continuous monitoring and supervision mechanism.
(Picture description) Source: Everbright Securities
CITIC Securities said that my country's stock and bond market opening policies have been frequently introduced recently, and the efforts have been continuously strengthened. The implementation of this new regulation will promote overseas institutional investors to actively participate in my country's multi-level capital market in the long run.
Great Wall Securities html released a research report at the end of September 5, saying that my country's bond market and stock market scale rank second in the world, but the proportion of foreign capital holdings is only about 2%-4%. In the future, with the steady advancement of financial market opening up to the outside world, overseas capital will still have great growth space and growth momentum when entering China.
Kaiyuan Securities further stated that more medium- and long-term funds will enter the Chinese market in the future, and the internationalization level of the A-share market is expected to improve. (End)
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Source: Xinhua News Agency
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