China will allow foreign companies to control up to 51% of local firms providing financial services (from 49%), a move that is set to give international players more fair and open access to the local market.
Historically the Chinese authorities have mandated foreign companies to share their know-how with local partners. While these requirements will remain in place, the most important limitation – that of a minority stake ownership could make even more companies set their eyes on China. The opening of the local financial services industry to foreign companies is not likely to be free. While the Chinese government has been relatively lax when it comes to the regulatory rules governing the sector, the move could spell the end of this approach.