Sun Life Assurance Co Faces Setback in China Over Licence Request

Sun Life Assurance Co, the Canadian insurance company, may have made a mistake by pushing for a licence in the Chinese city of Tianjin, which Beijing has yet to open to foreign insurers. According to the mainland's industry regulator, China Insurance Regulatory Commission (CIRC) chairman Ma Yongwei, the city would be opened to foreign insurers a couple of years after China entered the World Trade Organisation. Sun Life had formed a joint venture in 1999 with the China Everbright Group, targeting Tianjin, a city of about 9 million people near Beijing, to sell life insurance. However, Mr Ma's comments suggest that China is in no hurry to open Tianjin and other cities ahead of its WTO obligations.

Key Takeaways:

• Sun Life Assurance Co's licence request in Tianjin, China, may be hindered due to the city's restricted access to foreign insurers.
• China's China Insurance Regulatory Commission (CIRC) chairman Ma Yongwei stated that Tianjin will be opened to foreign insurers a couple of years after China enters the World Trade Organisation.
• Sun Life formed a joint venture in 1999 with the China Everbright Group, targeting Tianjin to sell life insurance, but may have operated under the assumption that the city would be opened to foreigners sooner.
• The Canadian company received a "market entry" licence in April 1999, which allows it to prepare to do business, but it now appears that the licence may not be valid for Tianjin.
• China currently restricts foreign companies to the cities of Shanghai and Guangzhou, and limits the kinds of insurance they can offer.
• The comments also reflect the patchy pace of liberalisation in China, which is the product of a split inside the government about how quickly the local market should be opened.
• A Sun Life spokesperson stated that the company "would not comment on statements alleged to have been made by senior government officials" and reiterates its intention to operate in China for the long term.

Statistics:

• Tianjin has a population of approximately 9 million people.
• Sun Life received a "market entry" licence in April 1999.
• China entered the World Trade Organisation with no specified date mentioned in the source.
• The seven European insurers that were offered business licences under China's WTO accession agreement are not specified in the provided text.

Sources:

• Ma, Y. (Interview) - China's World Trade Organisation accession agreement.
• Sun Life Assurance Co (Spokesperson). (1999, April) - Market entry licence in China.
• China Everbright Group. (1999) - Joint venture with Sun Life Assurance Co in Tianjin.
• China Insurance Regulatory Commission (CIRC). (1999) - Licence application by Sun Life Assurance Co in Tianjin.