China to Allow Foreign Multinationals to Directly Set Up Internal Finance Firms

China’s banking regulator will allow foreign multinational groups to directly establish internal finance companies from next month, in an effort to widen market access for overseas investors.

Multinational groups incorporated outside the Chinese mainland will be able to directly set up internal finance companies on the mainland, according to updated rules (link in Chinese) released by the China Banking and Insurance Regulatory Commission (CBIRC) last week, which will take effect starting Nov. 13. Internal finance companies provide financial services to the groups’ local member firms.