More than 30 global asset managers will have set up investment entities in mainland China by the end of the year, according to a prediction.
The newcomers will follow the likes of JP Morgan, Manulife and Vanguard in gaining licences to operate as independent businesses on the mainland, said consultancy Z-Ben Advisors.
“It’s been a busy six months with a clear escalation of activity onshore by global asset managers,” said the consultancy, which added that there was “far greater urgency” to set up onshore entities than at this time last year.
Many global managers have gained licences to operate as wholly foreign-owned entities (WFOEs) on the mainland. For some, this is preferable to being minority partners in joint ventures with Chinese fund managers, which was previously the main way global managers operated on the mainland.
However, Z-Ben Advisors said Chinese regulation was still unclear, creating challenges for newcomers and commercial advantages for some firms.
“When it comes to China, it would be easy to assume that there is increasing clarity for global managers; there isn’t,” said the consultancy. “Regulators have worked to shed light on some of the most pressing areas, but they can only move so fast. The remaining grey areas have been used constructively by some to advance competitively over their peers.”
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