China has specified ownership limits for overseas investors buying shares in companies listed in the Chinese mainland via the recently announced Hong Kong-Shanghai cross-border stock investment pilot program.

According to rules published by the China Securities Regulatory Commission (CSRC) over the weekend, a single foreign investor cannot hold more than 10 percent of a company listed on a mainland exchange. The program is to be launched in October.

The maximum combined holdings of all foreign investors in a single Chinese listed firm will be 30 percent, the CSRC announced, but added that these limits do not include stakes held by strategic investors.

In China, the term "strategic investors" is ordinarily used to describe long-term investors, many of whom typically have their shares subject to a lock-up period extending several years.

The CSRC published a draft of the regulations in May to seek public opinion. The announcement over the weekend means that rules have now been finalized.

China announced in April that it would allow cross-border stock investment between Shanghai and Hong Kong in a step toward opening China's capital account and also letting Chinese individuals buy foreign equities overseas.

The program will allow foreign individuals to buy Chinese stocks directly for the first time, although the selection is restricted mostly to dual-listed shares and index heavyweights.

Currently, only selected foreign institutions are permitted to trade Chinese equities through mutual funds operating under the Qualified Foreign Institutional Investor (QFII) program or the similar, yuan-denominated RQFII scheme.