(Yicai Global) July 17 -- Tengan Information Technology Shenzhen, a third-party fund sales unit under Internet giant Tencent Holdings, received approval from China Securities Regulatory Commission for fund sales early this year, after the resale price of such licenses has been setting records, insider sources say. 

China's tightening regulation over transfers of fund sales licenses since the second half of last year has pushed the prices of such permits up to nearly CNY150 million (USD22.4 million), state-owned China Radio & TV reported.

The purchase price of the fund sales license has been in a strong uptrend over the past three years, up from a starting price of only CNY5 million at the end of 2015 to a recent CNY140 million, online news portal China reported. The number of buyers has recently offered a buy-it-now price of CNY100 million, and even CNY120 million has been legion.

Purchasers of the fund sales licenses are mainly of two types: institutions that need the license to engage in third-party wealth management, and institutions that wish to dabble in private sales business.

Issuing and selling asset management products through the internet without permission is now illegal under new rules. Introduction of the new policy has produced a scarcity of the licenses and pushed their prices into the stratosphere.

The regulator may rectify and spruce up the market before considering issuing new licenses, insiders note, but strict regulation of their quantity and quality seems here to stay.

Demand from tens of thousands of third-party wealth management companies in Beijing, Shanghai, Guangzhou, and Shenzhen alone highlights the huge mismatch between the mere several hundred licenses available and the numbers of those vying to secure them.

After Tengan Fund got the green light this year, the number of independent fund sales firms on the CSRC's list as of September 2016 rose from 107 to 108 in a sure sign that the future pace of such increments will be glacial indeed.

Editor: Emmi Laine