IB doesn't have a brokerage license in Mainland China
A Chinese Brokerage for U.S. Stocks Seeks a Nasdaq Listing
- Thread starter ETJ
- Start date
IB doesn't have a brokerage license in Mainland China
IB financed their customer. Tiger Brokers has over 76,000+ accounts with IB. Tiger Brokers and other mainland firms are IB's gateway into China since they don't have a brokerage license of their own to solicit mainland residents.
This is a good reason for IB to invest in Tiger. Win-win situation. But situation will be different when IB gets a brokerage license from China government.
Maybe IB buys tiger once it's all setup and proven profitable.
Who knows when China will give them a brokerage license for mainland china. Many brokers were hoping they would get access to China after Bill Clinton's government struck a deal that allowed them into the WTO. They're still waiting for access LOL
First of all, would be nice if somebody can post the full article instead of just a link to the stupid paywalled WSJ site. Second, this has more to do with those early investors, "backers" wanting to cash in on their investment and at the same time allowing China to gain more control on and access to US investors than anything else.
Well if China doesn't allow US brokerage firms access to their customers, US shouldn't allow Chinese brokerage firms access to US customers here either especially when you never know who really owns the brokerage firm in the background. Chinese brokerage firms have been trying very hard though to try to get access to the US investors' market by taking over US-registered brokerage firms and offering zero-commission, zero-cost services, and now this.
A lot of countries have built in rules restricting the marketing of brokerage services to their citizens. Canada is a good example. China may ease up a little bit but they won't open up their markets for the likes of Schwab, TD Ameritrade or, Etrade until their own firms get bigger.
Even Tiger broker would be customers have a hard time getting their accounts funded due to increased capital controls with domestic banks in china.
Well it's not US brokerage firms' fault that the local Chinese brokerage suck so much and many times are fraudulent with no adequate overseeing in place. China's brokerage firms really have no reasons not to grow big given the huge population base it gets to work with and the strict capital control that is in place that basically locks the local citizens' money all in the country. The only reason why it's not succeeding is really due to China's own fault. And now with them trying to extend into the US market where there is adequate regulatory overseeing and the business environment is healthier, relatively, they are taking businesses away from the US brokerage firms who are already restricting themselves in their business venues to try to adhere to the various regulations (at least on paper) and plus having to deal with a smaller population base and non-existent capital control. So what China is doing is like they don't take care of their own house and now they just try to go to other people's house that's much cleaner to try to live there and ruin the other people's house potentially.
Canada is different. Foreign brokerage companies are allowed to do business in Canada as long as they register in Canada and agree to be regulated by the Canadian regulatory bodies unlike in China, you are not even allowed to get registered to do brokerage business in China. This has nothing to do with marketing.
