On December 29, the Executive Committee of the Hengqin Guangdong-Macao Deep Cooperation Zone (hereinafter referred to as the Cooperation Zone) issued the “Pilot Measures for Foreign-Invested Equity Investment Enterprises in the Hengqin Guangdong-Macao Deep Cooperation Zone (Interim)” (hereinafter referred to as the “Pilot Measures”). Overseas investors, including those in the Hong Kong, Macao and Taiwan regions, can apply for foreign-invested equity investment enterprises in the Cooperative Zone through the “Pilot Measures”, that is, QFLP (Qualified Foreign Limited Partner) pilot projects and carry out equity investment and other business domestically. This is an important initiative of the Cooperation Zone to actively implement the “Overall Plan for the Construction of the Hengqin Guangdong-Macao Deep Cooperation Zone”. It innovates cross-border financial management and further opens up cross-border asset management channels. It has a positive effect on encouraging social capital to set up multi-currency private equity funds in the cooperative zone and use foreign capital to support the construction of the cooperative zone.
As an important system for the Cooperation Zone to support the development of the modern financial industry in Macao, the “Pilot Measures” establish a joint consultation mechanism for the pilot work, clarify requirements such as pilot conditions, pilot operation, pilot applications and pilot management. At the same time, it is proposed to establish a green channel mechanism to serve Macao enterprises to provide them with a more convenient pilot environment.
The “Pilot Measures” issued by the Cooperation Zone this time have the highlights of “zero threshold, no restrictions, and broad investment”. First, in terms of entry thresholds, there are no mandatory requirements for overseas shareholders or partners to manage assets, size of own assets, or hold financial licenses. Second, in terms of registered capital, there are no restrictions on the registered capital, initial investment ratio, and investment period of overseas investors. Third, in terms of investment business, it includes shares of unlisted companies, shares not publicly issued or traded by listed companies, convertible bonds, market-based debt-for-equity swaps, and equity fund shares. As the original shareholders of listed companies, they participate in various businesses such as allotment of shares. In addition, pilot companies can also participate in investing in domestic private equity investment funds and venture capital funds (FOF).
The “Pilot Measures” stipulate that pilot enterprises shall be private equity institutions and must apply for private equity fund manager registration and private equity fund filing procedures at the China Securities Investment Fund Industry Association in accordance with relevant regulations. It is worth mentioning that the “Pilot Measures” implement indiscriminate management of domestic and foreign capital. In addition to the basic “external management” business model, they also allow “outside management” and “outside management”, that is, foreign-invested equity investment management enterprises are allowed to initiate the establishment or entrustment management of domestic private equity and venture capital funds; domestic private equity and venture capital fund managers in all regions of the country are allowed to establish or entrust management of foreign-invested equity investment enterprises in cooperative zones.
The “Pilot Measures” will be officially implemented on January 29, 2022. Efforts will be made to create a more convenient investment environment and provide strong institutional guarantees for overseas capital. At the same time, it will open up cross-border two-way investment channels for QFLP (Qualified Overseas Limited Partner) and QDLP (Qualified Domestic Limited Partner) to attract domestic and foreign asset management institutions to exhibit in the cooperative zone and provide high-quality financial support for the construction of the cooperative zone.
As an important system for the Cooperation Zone to support the development of the modern financial industry in Macao, the “Pilot Measures” establish a joint consultation mechanism for the pilot work, clarify requirements such as pilot conditions, pilot operation, pilot applications and pilot management. At the same time, it is proposed to establish a green channel mechanism to serve Macao enterprises to provide them with a more convenient pilot environment.
The “Pilot Measures” issued by the Cooperation Zone this time have the highlights of “zero threshold, no restrictions, and broad investment”. First, in terms of entry thresholds, there are no mandatory requirements for overseas shareholders or partners to manage assets, size of own assets, or hold financial licenses. Second, in terms of registered capital, there are no restrictions on the registered capital, initial investment ratio, and investment period of overseas investors. Third, in terms of investment business, it includes shares of unlisted companies, shares not publicly issued or traded by listed companies, convertible bonds, market-based debt-for-equity swaps, and equity fund shares. As the original shareholders of listed companies, they participate in various businesses such as allotment of shares. In addition, pilot companies can also participate in investing in domestic private equity investment funds and venture capital funds (FOF).
The “Pilot Measures” stipulate that pilot enterprises shall be private equity institutions and must apply for private equity fund manager registration and private equity fund filing procedures at the China Securities Investment Fund Industry Association in accordance with relevant regulations. It is worth mentioning that the “Pilot Measures” implement indiscriminate management of domestic and foreign capital. In addition to the basic “external management” business model, they also allow “outside management” and “outside management”, that is, foreign-invested equity investment management enterprises are allowed to initiate the establishment or entrustment management of domestic private equity and venture capital funds; domestic private equity and venture capital fund managers in all regions of the country are allowed to establish or entrust management of foreign-invested equity investment enterprises in cooperative zones.
The “Pilot Measures” will be officially implemented on January 29, 2022. Efforts will be made to create a more convenient investment environment and provide strong institutional guarantees for overseas capital. At the same time, it will open up cross-border two-way investment channels for QFLP (Qualified Overseas Limited Partner) and QDLP (Qualified Domestic Limited Partner) to attract domestic and foreign asset management institutions to exhibit in the cooperative zone and provide high-quality financial support for the construction of the cooperative zone.