China Banking and Insurance Regulatory Commission issued a notice to standardise how insurance funds make “major equity investments” in unlisted enterprises, combining a clarified transaction definition with updated sector eligibility and strengthened governance and risk-management expectations. The notice defines a major equity investment as a direct equity investment by an insurance institution and its related parties that results in control or joint control of an unlisted enterprise. It also adjusts the scope of investable industries to better align with insurers’ core business and the policy framework of the “five key priorities”, adding “technology” and the “big data industry” and encouraging greater equity investment in strategic emerging industries. Governance requirements include establishing robust investment decision-making and delegated-authority mechanisms, improving equity investment management systems, strengthening post-investment management, and enhancing risk isolation. A “new–old separation” approach applies, with new investments required to comply with the notice. For existing business that does not meet the requirements, insurance institutions are to develop rectification plans with clear timelines, submit them to the regulator, and implement them after filing.
China Banking and Insurance Regulatory Commission 2025-04-03
China Banking and Insurance Regulatory Commission issues rules for insurers’ major equity investments in unlisted companies
The China Banking and Insurance Regulatory Commission issued a notice to standardize insurance funds' major equity investments in unlisted enterprises. It clarifies transaction definitions, updates sector eligibility to include technology and big data, and strengthens governance and risk management. A "new–old separation" approach mandates compliance for new investments, while existing non-compliant business must develop rectification plans.