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I. Business Overview
QFI (Qualified Foreign Investors) system is an important move adopted by the Chinese government to attract foreign investment by limited liberalization of its capital market under foreign exchange control and incompletely free convertibility of RMB in China. At the end of 2002, the issue of Provisional Administrative Measures on Domestic Securities Investments of Qualified Foreign Institutional Investors (QFII) signified the formal introduction of QFII system to China. According to the Management Measures for Domestic Securities and Futures Investment by Qualified Foreign Institutional Investors and RMB Qualified Foreign Institutional Investors [Order No. 176] issued by the CSRC, PBC, and the SAFE on September 25, 2020 and implemented on November 1, 2020, the original QFII and RQFII systems were combined, collectively referred to as QFI, which refers to foreign institutional investors who use funds from overseas for domestic securities and futures investments, upon approval by the CSRC. The use of RMB funds from overseas for domestic securities and futures investments is encouraged. To apply for the qualification for QFI, an application form should be filled out online through the website of the CSRC, and relevant application documents should be submitted to the CSRC through the domestic custodian.
II. Target Customers
In accordance with the Management Measures for Domestic Securities and Futures Investment by Qualified Foreign Institutional Investors and RMB Qualified Foreign Institutional Investors, the main customers of QFI custody services provided by ICBC include overseas fund management companies, commercial banks, insurance companies, securities companies, futures companies, trust companies, government investment institutions, sovereign funds, pension funds, charitable funds, endowment funds, and international organizations recognized by the CSRC.
1.Overseas fund management companies;
2.Overseas insurance companies;
3.Overseas securities companies;
4.Overseas commercial banks;
5.Overseas futures companies;
6.Overseas trust companies;
7.Government investment institutions, sovereign funds, pension funds, charitable funds, endowment funds, and international organizations;
8.Other institutions recognized by the CSRC.
III. Scope of Services
1.Basic services
(1)Agency service: Application for QFI qualification, registration and filing with the SAFE, application for opening of foreign exchange account, special RMB account and securities account, and proxy voting etc.;
(2)Safekeeping: Provide asset custody service for QFI customers;
(3)Capital clearing: Complete securities delivery and clearing for domestic investments of QFI customers;
(4)Accounting: Record QFI investment activities in the account books;
(5)Asset valuation: Valuate QFI investment assets according to international accounting standards;
(6)Company information: Provide the information about QFI securities holdings and financial market news;
(7)Investment supervision: Supervise shareholding ratio according to QFI portfolios and regulatory requirements;
(8)Foreign exchange conversion: Currency conversion, and foreign exchange settlement and sales;
(9)Record keeping: Properly keep the records on investment and fund inflows/outflows and other materials;
(10)Other services: Other services required by regulatory authorities.
2. Value-added service
(1)Performance evaluation: Performance estimation and evaluation for QFI portfolios;
(2)Risk management: QFI investment risk warning and risk assessment report;
(3)Cash management: Multiple cash management instruments for QFI customers;
(4)Electronic banking: Uploading and downloading of electronic banking data;
(5)Tax agency: Declare and pay taxes for QFI customers as an agent;
(6)Customized reports: Provide reports in customized types and formats;
(7)Other services: Other customized requests proposed by QFI customers.
IV. Service Advantages
ICBC was one of the earliest banks providing QFI custody services in China. Due to its familiarity with China’s securities market policies and QFI system, the Bank has helped a large number of customers successfully expand their business in Chinese market.
As the largest custodian bank in China, ICBC has maintained its first position in the market for 25 consecutive years in terms of market share of asset custody business.
ICBC is the most professional custodian bank in China, with an advanced custody service system independently developed by it. The system has obtained ISAE3402 authentication (formerly known as SAS70), the first one of its kind in China, indicating that ICBC’s custody services have met international standards.
ICBC, the most powerful domestic commercial bank, owns a fast clearing network, abundant RMB funds and strong A share settlement capability, hence it can provide QFI customers with efficient and comprehensive service support.
V. Business Flow
VI. Contact Information
If you would like to apply for any service, please contact the Global Asset Custody Division of Asset Custody Department of ICBC:
Contact: Lei Siqi
Tel.: (8610) 66104709
E-MAIL: siqi.lei@icbc.com.cn
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