Beijing (AFP) – Wall Street titan JP Morgan Chase has become the latest firm to apply for a controlling stake in a Chinese securities venture, taking advantage of new rules Beijing put in place last month as part of a move to open up the economy.
JP Morgan Broking applied to establish a foreign invested securities firm with 51 percent control on May 10, according to a statement by the China Securities Regulatory Commission (CSRC) posted on Thursday.
“The CSRC will carry out the relevant auditing efficiently, in compliance and according to the law,” the statement said.
JP Morgan’s application comes after the CSRC said Switzerland-based UBS Group and Japan’s Nomura Holdings had applied for controlling stakes in mainland China ventures under the new rules.
Laws limiting foreign ownership of local financial firms have long stopped global banks from independently operating in China and limited their growth.
But Beijing said it would liberalise shareholding limits in the financial services industry last year, soon after US President Donald Trump visited Beijing.
Officials moved to make good on the pledge last month, immediately allowing foreign investors to take 51 percent stakes in securities firms and fund managers, with pledges set out to eventually allow full control.
The financial services liberalisation goes hand in hand with a similar plan announced for the auto industry and comes as China is accused by the Trump Administration of favouring domestic firms over foreign companies.
Beijing has pledged to open up its economy as it looks to head off a possible trade war with the United States, which accuses it of using unfair practices to get an advantage for its own firms and destroying American jobs.
China’s top economic official, Vice Premier Liu He, will head to Washington for trade talks next week after a high-level meeting in Beijing last week failed to make any breakthroughs.