China policy round-up: MoF, CSRC give SFC access to mainland firms’ audit papers, Chinese premier promises to scrap foreign ownership ahead of schedule, FTZs to enjoy greater policy-setting freedom

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China policy round-up: MoF, CSRC give SFC access to mainland firms’ audit papers, Chinese premier promises to scrap foreign ownership ahead of schedule, FTZs to enjoy greater policy-setting freedom

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In this round-up, Chinese securities regulators allow their Hong Kong counterpart to access audit papers of Hong Kong-listed mainland companies, Chinese premier Li Keqiang vowed to lift the 51% foreign ownership cap on Chinese financial firms sooner than planned, and free-trade zones (FTZs) receive more autonomy in trying out new policies.

The Chinese Ministry of Finance (MoF), the China Securities Regulatory Commission (CSRC) and the Securities and Futures Commission (SFC) of Hong Kong signed a tripartite memorandum of understanding on Wednesday, according to a joint press release.

The agreement will allow the SFC to access audit working paper of Hong Kong-listed mainland-based companies and issuers. These audit working papers also need to be created by Hong Kong accounting firms.

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Premier Li Keqiang announced on Tuesday at the World Economic Forum in Dalian that full foreign ownership of securities firms, futures businesses and life insurance companies will be allowed by 2020, a year ahead of schedule.

As of now, China places a 51% cap on foreign ownership of any domestic securities, futures or life insurance companies.

The timing of Li’s announcement came days after Chinese president Xi Jinping and US president Donald Trump’s meeting in Osaka during the G20 Summit.

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The Chinese state council met on Wednesday and decided to grant FTZs more autonomy to try out new policies, especially in areas of investment approval and market access.

“The government will step up exploration of measures to widen market access, especially in opening the service sector,” according to an announcement on the government’s website.

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The Asset Management Association of China and the Association of the Luxembourg Fund Industry announced on Thursday that the two have jointly completed a review of Chinese and European public fund regimes and reported its findings to the governing body of each association, according to a joint press release.

The duo mainly reviewed rules applied to publicly offered funds in China and the EU undertakings for collective investment in transferable securities under Luxembourg laws.

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Chinese president Xi Jinping talked with the Turkish president Recep Tayyip Erdogan in Beijing on Tuesday.

Xi told Erdogan that “China is ready to strengthen co-operation with Turkey in the field of international anti-terrorism,” reported Xinhua, a state-owned media.

“What that means: help us round up those Uighur dissidents in Turkey,” Trivium, a consulting firm, wrote in a Wednesday note.

Erdogan said he is ready to strengthen security co-operation with China in opposing extremism, Xinhua further reported.

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