solution

Case study

China and the WTO

The World Trade Organization produced the following statement in response to the conclusions of negotiations on China’s accession.
Banking
Upon accession, foreign financial institutions will be permitted to provide services in China without client restrictions for foreign currency business. For local currency business, within two years of accession, foreign financial institutions will be permitted to provide services to Chinese enterprises. Within five years of accession, foreign financial institutions will be permitted to provide services to all Chinese clients.
Insurance
Foreign non-life insurers will be permitted to establish as a branch or as a joint venture with 51 per cent foreign ownership. Within two years of China’s accession, foreign non-life insurers will be permitted to establish as a whollyowned subsidiary. Upon accession, foreign life insurers will be permitted 50 per cent foreign ownership in a joint venture with the partner of their choice. For large-scale commercial risks, reinsurance and international marine, aviation and transport insurance and reinsurance, upon accession, joint ventures with foreign equity of no more than 50 per cent will be permitted; within three years of China’s accession, foreign equity share shall be increased to 51 per cent; within five years of China’s accession, wholly foreign-owned subsidiaries will be permitted.