Foreign investors beware: a byzantine regulatory framework and patchy trading volumes could cause a shock in the country’s debt market, say analysts — just as Beijing is opening it up to outsiders.

Three years ago a domestic brokerage called Sealand Securities suffered huge losses on a highly leveraged financing deal which was funded by banks. When the investment went sour and Sealand defaulted on its loans, banks pulled credit from brokers and other nonbank financial institutions. The mini-meltdown led to interbank lending rates shooting up and liquidity in the bond market evaporating.

“It took a few days to figure out what had actually happened,” said one foreign investor who weathered the December 2016 storm, noting that regulatory transparency was low at the time.