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JV China’s first money broker
A joint venture will form the first money broker in the People’s Republic of China (PRC), after the country’s State Council approved the establishment of a money brokering system. Allen &…
Lawyers Weekly
A joint venture will form the first money broker in the People’s Republic of China (PRC), after the country’s State Council approved the establishment of a money brokering system.
Under current policy restrictions, the joint venture is structured with a 67 per cent stake held by SITICo and 33 per cent by Tullet Prebon. However, it is documented that the parties will effect an equity transfer to make a 50:50 holding structure as soon as the PRC policy allows.
The joint venture, Tullet Prebon SITICo (China) Ltd, will be able to engage in money market, bond market and derivative instrument transactions, both onshore and offshore. The China Banking Regulatory Commission is expected to approve the deal by the end of the year.
Senior associate Ming Zu led the Allen & Overy team, with members including Shanghai managing partner Simon Black and associate Robert Cui. Black said the transaction was the first money brokering Sino-foreign joint venture in the PRC following the promulgation of Measures for the Administration of Pilot Money Brokering Companies by CBRC in September. “[Its establishment] is an indication of the PRC’s capital market being further opened to foreign financial institutions.”
