
Publication
Calming the storm after the SVB collapse: Prudential policy the key to stability
The collapse of Silicon Valley Bank, Signature Bank and Silvergate Bank in the last week has caused turmoil in global financial market.
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Global | Publication | September 2019
The first round of liberalisation policies in respect of China’s insurance sector were announced at the Boao Forum for Asia Annual Conference in 2018. Since then, China has continued to implement legislation to liberalise foreign investment in its insurance industry. The latest round of legislative developments have come into effect and liberalisation of foreign investment in the life insurance sector has been brought forward to 2020, signaling the Chinese Government’s commitment to attract foreign investment into China.
Here is a summary of the key foreign investment requirements that now apply to the insurance sector in China:
Insurers | Professional insurance agents | Insurance brokers | Insurance asset managers | |
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Is there any foreign shareholding restriction? |
No – up to 100% shareholding ownership is permitted
Yes – currently limited to a maximum of 51% but this restriction will be lifted and up to 100% shareholding will be permitted from 2020 |
No – up to 100% shareholding ownership is permitted | No – up to 100% shareholding ownership is permitted | Yes – currently limited to a maximum of 25% but this restriction will soon be lifted and up to 100% shareholding will be permitted |
Who can be a foreign shareholder? |
It is no longer necessary for foreign investors to have operated an insurance business for at least 30 years. In addition, regulatory decisions have also been made to remove the requirement for foreign investors to have had an insurance representative office in China for at least two years1 |
Foreign specialized insurance agency institutions that have engaged in insurance agency business for at least 3 years (subject to non-hard core qualification requirements) It is no longer necessary to follow the strict qualification requirements set out under the CEPA2 regime so as to wholly own a professional insurance agent |
Foreign specialised insurance brokerage institutions (subject to non-hard core qualification requirements) Regulatory decisions have been made to remove the qualification requirement for foreign investors to have minimum total assets of US$200 million by the end of the last fiscal year. The following qualification requirements for foreign investors will be removed soon:
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Foreign insurance group company or insurance company (acting as the promoter) satisfying the following qualification requirements:
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What is the minimum capital contribution? |
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Is approval from the China Banking and Insurance Regulatory Commission (CBIRC) required? |
Yes – prior approval from CBIRC is required
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Yes – approval from CBIRC is required after registration of the company | Yes – approval from CBIRC is required after registration of the company |
Yes – prior approval from CBIRC is required
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Is the foreign investor able establish a branch in China? | Yes – with prior approval from CBIRC | Yes – after notification to CBIRC | Yes – after notification to CBIRC | Yes – with prior approval from CBIRC |
Publication
The collapse of Silicon Valley Bank, Signature Bank and Silvergate Bank in the last week has caused turmoil in global financial market.
Publication
The European Union’s Foreign Subsidies Regulation (the FSR) entered into force on 12 January 2023 and creates a new regime aimed at combating distortions of competition on the EU internal market caused by foreign subsidies. It imposes mandatory notification and approval requirements for acquisitions of significant EU businesses and large EU public tenders, and gives the European Commission (EC) extensive powers to launch ex officio investigations. The notification requirements go live on 12 October 2023.
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