Fidelity Approved by CSRC to Set up Retail Fund Business in China

Fidelity has become the second global asset manager to receive approval from China Securties Regulatory Commission (CSRC) to set up a fully-owned mutual fund business in China after BlackRock.

Fidelity submitted its application for approval to sell retail funds in China in May 2020.

The new company will be based in Shanghai with a registered capital of $ 30 million, which will be 100% controlled by Fil Asia Holding Pte. Ltd, a Singapore-based unit of Fidelity.

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In 2017, Fidelity became the first foreign institution to set up a wholly-owned company (WFOE) in China for privately offered funds. Four privately managed funds have since been set up, targeting institutional clients and high-net-worth individuals. Two of the funds are currently in operation.

Fidelity will have to liquidate or transfer these private fund products before it rolls out new mutual fund products under the new company. It has six months to set up the new business, following which it will need CSRC approval to commence operations.

Following the removal of foreign ownership caps in China's mutual fund and securities sectors on 1 April 2020, Fidelity has become just the second global asset manager to receive approval to set up a fully-owned mutual fund business.

Recently, Fidelity Digital Assets, part of Fidelity Investments, was reportedly planning to expand its workforce by about 70% to meet increading demand for crypto services from institutionsl investors.