China Loosens Limits on Overseas Investment

China is relaxing controls on companies seeking overseas financing in a move meant to boost development of private and high-tech companies, the government said.

The change in policy will allow Chinese companies to set up offshore companies to raise funds and conduct mergers and acquisitions inside China.

The revised rules, which will take effect Nov. 1, require such offshore companies to transfer income back to China within 180 days after it is earned. The change is also aimed at eliminating a loophole in the regulations that made it difficult for regulators to monitor cross-border capital flows.