China will detail rules to allow foreign hedge fund managers to launch products in the country, the nation's securities regulator said on Thursday, as authorities step up efforts to further liberalize and deepen the domestic capital markets.
The China Securities Regulatory Commision (CSRC) has allowed the Asset Management Association of China (AMAC) to specify details regarding registration and qualification issues, the regulator said on its website.
The move will help diversify the pool of investors, bring in new asset management talent and deepen deregulation of the capital markets, CSRC said.
Some foreign asset managers, including the world's largest hedge fund, Bridgewater Associates, have already set up units in China. But they cannot launch funds there without registering with China's fund association.
CSRC said the rules will apply to secondary market as well as to private equity products.
The latest move joins a concerted effort by Beijing over the past couple of years to liberalize China's highly regulated capital markets, though recent interventions in the currency and stock markets have raised questions about the government's commitment to reforms.
CSRC said the step is aimed at deepening its commitment made during the U.S.-China Strategic and Economic Dialogue in 2015.
Foreign asset managers launching products in China must set up operations locally, raise capital locally, and invest in the domestic capital markets, without conducting cross-border transactions, the regulator said.
In the mutual fund space, foreign asset managers have long been granted access, but they must set up joint ventures with local firms.