Foreign stakes in new local underwriting joint ventures will be capped at 33% under soon to be released new rules, the Wall Street Journal reported. This limit could be raised to 49% in future, according to an anonymous source. Joint ventures will be limited to underwriting securities at first, but regulators could issue licenses for other activities after an unspecified "seasoning period." Morgan Stanley and Credit Suisse have already signed preliminary agreements for joint ventures. Foreign investors may soon also invest in existing Chinese brokerages, although specific rules controlling investment are not yet known. The rules will apparently be modeled on limits governing foreign investment in commercial banks, where a foreign investor may own as much as 20% of a bank, and total foreign investment is limited to 25%. The China Securities Regulatory Commission did not comment. The implementation of new rules was announced during December’s US-China Strategic Economic Dialogue.