The China Banking and Insurance Regulatory Commission published a consultation draft of the Asset Management Trust Management Measures, setting out an updated, end-to-end supervisory framework for trust companies’ asset management trust business. The draft positions asset management trusts as private placement asset management products based on a trust legal relationship, bars principal or return guarantees, and requires trust companies to exercise active management and comply with market and fair trading principles. Structured in five chapters and 85 articles, the draft would tighten requirements across product set-up, operation and termination, including qualified investor standards, suitability and risk tolerance assessment, risk disclosures, subscription documentation, unit transfers and liquidation. It reinforces a private placement model by limiting issuance to qualified investors on a non-public basis with no more than 200 investors, and it envisages stricter investor qualifications and minimum investment amounts for higher-risk products. Sales rules would require prominent risk warnings, tighter oversight of sales channels and agent distributors, and risk matching through product-by-product risk grading and investor classification. Investment and risk provisions would require investment in real, legal and effective underlying assets within the permitted scope, impose concentration controls, differentiate management expectations by asset type including non-standard and related-party assets, set standards for investment cooperation institutions, require at least quarterly risk classification with adequate impairment provisioning, strengthen liquidity risk controls, and set a minimum 90-day term for closed-end trust products, alongside more detailed periodic and ad hoc disclosure. The draft also sets expectations for trust companies to review existing asset management trust business, identify items requiring remediation, and implement time-bound rectification plans with orderly scale reduction, with progress to be used in classification-based supervision. Business already subject to post-transition case-by-case handling under the asset management rules would continue rectification in line with existing requirements and previously submitted plans.
China Banking and Insurance Regulatory Commission 2025-10-31
China Banking and Insurance Regulatory Commission launches consultation on new Asset Management Trust Measures for trust companies
The China Banking and Insurance Regulatory Commission released a draft of the Asset Management Trust Management Measures, proposing a supervisory framework for trust companies' asset management business. It emphasizes private placement, prohibits principal or return guarantees, and mandates active management and adherence to market principles. It includes stringent requirements on investor qualifications, risk disclosures, and investment provisions, focusing on risk management and compliance.