UBP granted Mainland China license

UBP Overseas Investment Management (Shanghai), the wholly foreign owned enterprise (WFOE) of UBP, has reportedly been approved by the Asset Management Association of China to receive a QDLP licence.

The license will allow UBP Overseas Investment Management (Shanghai) (UBPOIMS) to create Qualified Domestic Limited Partnership (QDLP) products, according to an article by International Investor, a product which allows foreign entities to raise money in the country, which can then be invested in both traditional and alternative investments offshore, within assigned quotas.

The license, first announced in Q2 2018, also allows firms to create a Qualified Domestic Investment Fund, which can then feed into a master fund managed by the parent organisation overseas.

Other foreign entities which have received a QDLP licence include Oaktree Capital, Eastspring Investments and Allianz Global Investors.

One of the major issues which faced domestic firms utilising QDLP products was the restricted number of offshore investment options available to place the funds into, as the offering was dictated by what funds international mangers chose to offer to Chinese investors utilising this strategy, according to an article by Fund Selector Asia.

Additionally, any funds that exit the country via a QDLP product is subjected to multiple layers, including regulatory processes and the charging of fees, to allow the finances to be allocated offshore.