Apr 07, 2021 (China Knowledge) - A unit of BlackRock is reportedly closing down its private fund business in China to instead will focus on mutual funds and meet regulatory requirements.

BlackRock Investment Management (Shanghai) withdrew its private fund manager registration with Asset Management Association of China (AMAC) on 23 March. The move follows approval from the China Securities Regulatory Commission (CSRC) allowing BlackRock to set up a wholly-owned mutual fund unit in China – known as BlackRock Fund Management Co. Ltd.

To avoid conflicts of interest, Chinese regulations required BlackRock Investment Management to liquidate or transfer its private fund products to its mutual fund platform before rolling out its mutual fund products under the new licence.

Based on 2020 data, BlackRock Investment Management was managing a total of nearly RMB 1 bln from three private fund products registered with the AMAC. All three products were liquidated ahead of schedule.

BlackRock also has a separate unit – BlackRock Overseas Investment Fund Management (Shanghai) – which was set up in 2015 as a Qualified Domestic Limited Partner (QDLP) to raise funds from the mainland for investment in overseas markets. The unit has two QDLP funds currently in operation in China.

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