China says 'illegal' outbound investment crackdown won't lead to forced liquidation

June 8 (Reuters) - China's crackdown connected "illegal" cross-border concern won't pb to mainlanders' offshore accounts being closed and assets liquidated forcibly, the securities regulator said, amid capitalist concerns implicit the ‌fate of $54 cardinal worthy of assets.

Some savers from mainland China are travelling to Hong ‌Kong and scrambling to research options to clasp their investments successful the fiscal hub, aft Beijing's unexpected crackdown past period connected "illegal" ​cross-border securities trading.

The clamp-down and the sanctioning of overseas brokers for "illegally" helping Chinese investors bargain shares successful overseas markets does not impact their concern activities offshore, said the watchdog successful effect to Reuters queries.

The China Securities Regulatory Commission (CSRC) connection is the clearest denotation yet that overseas brokerages tin proceed to connection morganatic offshore ‌services to mainland clients.

The latest connection ⁠comes amid increasing disorder among Chinese investors implicit however to woody with their wealth and investments successful offshore brokerage accounts - worthy astir $54 cardinal according to Chinese ⁠broker Kaiyuan Securities.

Fears of forced liquidation triggered a sell-off successful U.S.-listed Chinese stocks instantly aft the crackdown was announced connected May 22.

"Safety of investors' assets volition not beryllium affected by the rectification campaign," the CSRC said ​in the ​statement. "Existing accounts volition not beryllium forcibly closed, and assets ​held successful those accounts volition not beryllium ‌subject to mandatory cleanup."

Onshore Chinese investors tin merchantability assets and determination wealth retired of the affected accounts, portion brokers' proviso of illicit services connected the mainland, including via websites and trading software, volition beryllium terminated successful 2 years, the CSRC said.

Tiger, Futu, Longbridge person told their onshore Chinese clients that starting mid-June, they tin nary longer unfastened caller accounts, adhd positions, oregon determination successful caller money, but offshore ‌services volition stay intact.

The CSRC said that its argumentation ​intention is wide - the crackdown was aimed astatine "purifying" China's superior ​markets, protecting investors, and "hitting" amerciable superior outflows ​from the country.

"No country, oregon portion would tolerate overseas institutions conducting amerciable activities ‌within its border," it said, and it indispensable ​be dealt with ruthlessly ​as they "seriously disrupt marketplace order, summation fiscal risks, and harm investors."

Responding to Reuters' question connected whether the tightening of superior controls besides seeks to nudge wealth into home superior markets, the ​securities watchdog said that Chinese assets ‌were "appealing", but did not elaborate.