Beijing has launched the Qualified Domestic Limited Partner (QDLP) pilot project that aims to support high-quality private equity fund managers in raising Renminbi for overseas market investment. With the approval of the State Administration of Foreign Exchange (SAFE), the QDLP pilot quota was subsequently increased to USD 10 billion.
At present, the subsidiaries of Oaktree Capital and Crédit Agricole CIB has been authorized to participate in the QDLP pilot project of Beijing, receiving initial quotas of USD 500 million and USD 300 million respectively. During the registration process for QDLP institutions, a pilot joint review mechanism will be established by Beijing Local Financial Supervision and Administration, along with the Operation Office of the People's Bank of China and the Beijing Foreign Exchange Management Department of SAFE, in an effort to accelerate the approval of QDLP quota applications made by institutions as well as the progress of institution registration. This will be accomplished through departmental linkage and rapid response. "Dual butler" service will be utilized to its full extent in order to rapidly respond to issues to be resolved. An information disclosure system, a fund custody system, and an information reporting system will be built to ensure the safety of investors' funds.
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The QDLP pilot project has been noticed with the following features:
- Cross-border Renminbi is included in the pilot project. Pilot funds can use QDLP quota to directly make overseas investment in Renminbi;
- The scope for pilot investment ranges from securities, bulk commodities, real estate investment trust funds (REITs), unlisted companies, etc.;
- A pilot joint review mechanism is built by Beijing Local Financial Supervision and Administration, the Operation Office of the People's Bank of China, and the Beijing Foreign Exchange Management Department of SAFE. This allows institutions to obtain pilot qualifications and quotas, and complete pre-management procedures for industrial and commercial registration all at once;
- An urban service butler is provided, with one-to-one dedicated service being provided for institutions intending to apply for QDLP quota. Issues to be resolved will be responded to quickly and handled immediately. Beijing Local Financial Supervision and Administration will strengthen financial support and service assurance by coordinating with relevant departments to steadily advance the QDLP pilot program.
- Pilot institutions will be engaged with the systems for information disclosure, capital trusteeship and information reporting. This ensures better guarantees regarding the safety of investors' capital by strictly managing eligibilities of investors and consistently minding and monitoring the status of capital.