Friction has surfaced between China's Foreign Trade Ministry and the securities market regulator over the approval and policing of foreign-invested joint-venture fund managers and securities firms.
According to trade ministry officials in recent days, such joint ventures, the first of which could emerge in the coming months, should be subject to China's foreign investment regulations.
The claims came as the China Securities Regulatory Commission (CSRC) began accepting joint-venture applications this week and appeared to challenge the CSRC's claim to ultimate authority.
Beijing has agreed to allow foreign investors up to 33 per cent stakes in joint-venture fund management and securities firms before December 11, 2004.
Approval guidelines announced by the CSRC named itself as the ultimate approval authority.
A Ministry of Foreign Trade and Economic Co-operation (Moftec) spokeswoman yesterday said: 'Our general principle is that, regardless of the firm's field of operation, a foreign-invested company will have to follow procedures specified in foreign investment regulations. The CSRC didn't consult with us before releasing the final documents.'