According to the GFSC, “the statement of cooperation with the China Banking Regulatory Commission (CBRC) outlines the way in which the two authorities recognise the importance of international cooperation for the development and maintenance of an ordered and sound finance industry in both China and Guernsey,” and is a major step in building new ties with China in financial services.

“In addition, the statement also highlights that the GFSC and the CBRC are aware of the internationalization in the supply of financial services and therefore the need for mutual cooperation and the sharing of information in the administration and enforcement of laws, regulations and rules concerning banking or other financial services in the two jurisdictions,” the GFSC said.

Welcoming the agreement, Peter Niven, the Chief Executive of Guernsey Finance, the promotional agency for the island's financial industry, commented: “I am delighted that the GFSC has signed this statement of cooperation with the CBRC. This puts in place a framework which allows enhanced cooperation between the two supervisory bodies. It will be the foundation for a very strong relationship with CBRC and the other regulatory bodies in China going forward.”

The signing of the agreement is the result of a push from the Guernsey government to establish stronger ties with China, which began with the opening of a representative office in Shanghai at the end of 2007.

In November 2010, on behalf of the Guernsey government, Chief Minister Lyndon Trott signed a Memorandum of Understanding for exchange and cooperation with the Shanghai Municipal Financial Services Office and a Tax Information Exchange Agreement with the Chinese central government tax authorities.

“This [latest] statement of cooperation is a further demonstration of the huge strides we have made building relationships and raising awareness of the Guernsey brand in China during the last few years," Niven said. "It is a significant endorsement of the high regard in which the island is held internationally and further adds to our position as a well-regulated, cooperative and transparent international finance centre.”

“In addition, it also puts another building block in place in terms of providing the right conditions for Guernsey firms to do business in China," Trott continued. "We have already seen a Guernsey-based legal practice establish an office in Shanghai, a local fund administrator has launched a joint venture with a firm in that same city, and I believe that this agreement will provide the final piece in the jigsaw which will see one of the Island’s fiduciaries set up in Shanghai as well.”

“Indeed, this agreement in itself could be extremely influential in helping our service providers attract business from China and we are hopeful that a similar agreement will be reached with the China Securities Regulatory Commission (CSRC) in the coming months," Trott added. "This is all very positive for Guernsey in terms of increasing the flows of business from not just our traditional introducer centres of the UK – in particular the City of London – and Europe but also the emerging markets, including China.”