PRC Funds Law Effective Today
June 1st, 2004The PRC’s first law on investment funds–the PRC Securities Investment Funds Law (中华人民共和国证券投资基金法 or Zhengquan touzi jijin fa)–became legally effective today.
The National People’s Congress Standing Committee passed the law back in October 2003. An English translation of the law and a brief commentary on it by me were published by China Law & Practice in January of this year.
The Securities Association of China just held a conference in Beijing on implementation of the new law, as described here.
Speakers at the “international” forum included CSRC Chairman Shang Fulin and Zhou Zhengqing, a former CSRC chairman who is now on the NPC’s Finance & Economics Committee.
Shang mostly spoke in generalities and platitudes, as is his custom. He did mention a few statistics on the funds industry, including a statement that 11% of the value of the A-share market is now held by funds. Shang also said that a set of regulations related to the Funds Law will be promulgated soon. Other stories in the PRC financial press have indicated these new rules will eliminate a requirement that a fund keep 20% of its assets in bonds.
Shang also said there is a 9-agency working group on implementing the State Council’s Nine Articles on PRC securities market development.
Zhou Zhengqing, who seems to be very active now in shaping policy for PRC securities markets, said in his speech that the role of fund management companies in retirement funds, including individual retirement accounts, should be developed.