Draft Law to Put More Public Funds in MarketChina has revised the draft of its investment fund law in an attempt to accelerate the legislative process and expand access to public investment in the stock market.The new version of the draft puts more emphasis on the securities investment funds, or mutual funds, and also covers sino-foreign fund management companies, said Wang Lianzhou, director of the panel guided by the Financial and Economic Committee of the National People's Congress (NPC). It requires that securities investment funds should be set up by fund management companies, but lifts demand that management firms should purchase a certain ratio of shares in the fund. Cao Fengqi, deputy director of the drafting panel, said securities investment funds will play a leading role in the fund industry in China. "Its development will fuel more institution investment in China's stock market and bring more order to the market," Cao said. The panel has just finished the revised version of the draft and is asking for advice within the securities circle. The newly revised draft has also designed principles for the set-up, purchase and redemption of open-ended funds, which allows more fluidity and requires stricter management and risk control as well as higher transparency. Insiders said the changes were in answer to deepened market reform and hopes that the draft should be finalized and sent to the NPC's Standing Committee for initial approval this year. |
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