Building Blocks

Draft legislation in China will allow for foreign fund management companies to enter joint ventures with domestic securities companies or their asset management subsidiaries for up to 49% of ownership after three years. The goal is to establish an open-ended mutual funds industry, but turning the draft legislation to law hinges upon China’s accession to the World Trade Organization. Currently, China has a booming $6-7 billion closed-end mutual funds market that remains closed to foreigners.