China securities regulator says crackdown won't force offshore closures, pushes funds toward innovation

China’s securities watchdog, the CSRC, clarified that its recent crackdown on “illegal” cross‑border investment will not lead to the forced closure of offshore accounts or the liquidation of assets held by mainland investors. The regulator said existing accounts remain safe and that brokers can continue offering legitimate offshore services, while illicit mainland activities will be phased out over two years. The move targets about $54 billion in offshore holdings and aims to curb illegal capital outflows without harming investors.

In a separate directive, the CSRC urged fund managers to direct capital into innovation‑driven sectors such as artificial intelligence and advanced manufacturing, warning against speculative or hype‑driven investments. Chairman Wu Qing emphasized “patient capital” for hard‑tech development and called for better operational efficiency using AI tools, signaling tighter regulatory scrutiny for funds that lack substantive tech focus.