Hainan Free Trade Port Cross-Border Asset Management Pilot Breaks Ground: Two Island-Based Public Funds First to Open Sales to Overseas Investors

Since the pilot program for cross-border asset management business at Hainan Free Trade Port was launched last October, related activities have been carried out among financial institutions within Hainan Province. Recently, two public fund management companies on the island, Peng’an Fund and Huibai Chuan Fund, announced that their specific products have officially been available to qualified overseas investors since March.

On March 13, a reporter from Daily Economic News learned from some pilot sales institutions that, besides specific products, customized offerings can also be applied for from issuing institutions. Some customization thresholds require over 10 million yuan, and all asset management scales are limited to an initial range of 10 billion yuan.

It is noteworthy that, currently, only issuing institutions that meet filing requirements have the authority to customize products, and these requirements apply to registered institutions on the island. Institutions registered outside the island with branches on the island are not yet permitted to apply for filing.

Two public funds break the ice first, some existing products open to overseas sales

On March 12, Peng’an Fund announced that, starting from March 12, it would sell to qualified overseas investors in accordance with the Implementation Rules for Cross-Border Asset Management Pilot Business at Hainan Free Trade Port (hereinafter referred to as the Implementation Rules). Not long ago, Huibai Chuan Fund issued a similar announcement, stating that the Huibai Chuan Yuanhang Hybrid Fund has been available to overseas investors since March 3.

In simple terms, qualified overseas investors can subscribe to these two fund products in Hainan Free Trade Port. Previously, it was relatively difficult for foreigners to allocate public funds domestically. Of course, the announced products are some of the fund companies’ existing offerings, and related activities had already been underway among financial institutions within the province.

On March 13, a source from a registered sales institution told Daily Economic News that they had cooperated with Huibai Chuan Fund since October last year. They adopted a targeted approach, designating a small number of specific investors to participate, with relatively small amounts, mainly to test whether the system chain could connect with overseas. “The first batch is pilot nature; the government’s supervision wants to see if the whole process can run smoothly. It’s not possible to promote widely all at once,” the person explained.

It is important to note that such targeted products differ significantly from standardized public fund sales. Investors cannot purchase through regular channels but must actively contact the fund company for product customization. “You need to find Huibai Chuan or Peng’an and ask them to customize a product for you. It’s somewhat like a public fund dedicated account or private placement, with a threshold generally starting at 10 million yuan, and multiple investors can participate together.”

Regarding the recent announcement that some products from the two public fund companies are open to overseas investors meeting the Implementation Rules, relevant personnel have not yet engaged in actual business. “This time, they are opening existing public fund products, which is different from last year’s targeted product business. We are still understanding how the specific structure links with cross-border qualifications,” they said.

In October 2025, the Hainan Securities Regulatory Bureau officially announced the filing of institutions for the pilot cross-border asset management business at Hainan Free Trade Port. Among the first six institutions, four are issuing entities, including Jinyuan Securities, Wanhe Securities, Huibai Chuan Fund, and Peng’an Fund. The other two are sales institutions: Haikou Branch of Industrial Bank Co., Ltd., and Haikou Branch of Shanghai Pudong Development Bank Co., Ltd.

Source: Screenshot from the Hainan Securities Regulatory Bureau website

According to the Implementation Rules, issuing institutions can issue pilot asset management products that are sold to both domestic and overseas investors, or products sold only to overseas investors. This development marks a significant breakthrough in the cross-border asset management business at Hainan Free Trade Port.

It is understood that the total quota for the pilot cross-border asset management business at Hainan is 10 billion yuan, approved at the provincial level. Now, with two institutions gradually opening their existing public fund products to overseas sales, the business model is expanding from targeted customization to standardized products.

Four institutions share the 10 billion yuan cake

So, aside from the previously registered issuing institutions, can other fund companies participate in related activities? A reporter learned that the policy for cross-border asset management at Hainan does not open to all financial institutions operating in Hainan but is strictly limited to legal entities registered in Hainan.

“Currently, only four have the qualification to issue cross-border asset management products: Huibai Chuan Fund, Peng’an Fund, Wanhe Securities, and Jinyuan Securities,” said the source. Although many leading public fund companies have significant influence, their registration locations are not in Hainan, so they are temporarily ineligible.

“The provincial policy only targets legal entities registered on the island. Branches of regular fund companies are not enough unless they move their registration to Hainan,” the person further explained. This requirement is not easy for most established public fund companies, as “relocating registration involves complex issues like corporate governance, tax arrangements, and personnel placement, which most fund companies are unlikely to undertake.”

This situation results in a current landscape where qualified institutions are few and relatively new. From this perspective, the 10 billion yuan pilot scale is temporarily open only to these four issuing institutions. Cooperation with banks is also strictly regulated. It is understood that financial institutions selling fund products must go through complete institutional and product approval processes. Although some banks have already filed successfully, their cooperation scope remains limited.

Therefore, for overseas investors, the available cross-border asset management products in Hainan are still quite limited. On one hand, leading public fund institutions registered outside Hainan have abundant existing products but lack pilot qualification, so their products cannot benefit from cross-border policies. On the other hand, qualified local institutions currently only offer specific products, and targeted customized products have high thresholds, with investors needing to meet the Implementation Rules’ criteria for overseas investors.

Industry analysts believe that Peng’an and Huibai Chuan’s early opening of existing products to overseas sales reflects the regulatory authorities’ cautious approach of “pilot first, promote later.” Under the total quota of 10 billion yuan, prioritizing local legal entities helps foster Hainan’s domestic financial strength and leaves room for future policy expansion.

In the future, as the pilot deepens, how to balance risk prevention and further opening, and attract more high-quality financial institutions to settle in substantively, will remain key issues for Hainan Free Trade Port.