Regulators announced a long-awaited pilot scheme to phase in flotation of non-tradable shares, which now account for over two-thirds of China's RMB3.5trn market cap. Unlike a similar scheme tried and scuttled over three years ago, this one enables existing shareholders to negotiate both the selling price and the method by which non-tradable shares are sold. This time around, arrangements must be passed by two-thirds of all voting stakeholders and voting tradable shareholders. Owners of non-tradable shares selected for the pilot will also be bound not to sell their holdings within a year of shares being floated. The scheme could bring volatility initially, the South China Morning Post warned, citing bankers, but also induce QFII investors to shift funds, now in fixed income and cash instruments, into the market.