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The national foreign exchange administration work conference was held in Beijing recently. Following the gist of the 18th CPC National Congress, the third, fourth and fifth plenums of the 18th CPC Central Committee and the Central Economic Work Conference, the meeting reviewed foreign exchange administration in 2015, analyzed the current economic, financial and BOP situations and made plans for foreign exchange administration for 2016. Pan Gongsheng, Deputy Governor the People's Bank of China and Secretary of the CPC Leading Group of the State Administration of Foreign Exchange (SAFE), delivered a work report, and deputy administrators, chief accountants, heads of the SAFE branches (foreign exchange administration departments) and departments of the SAFE attended the meeting. The meeting pointed out that, under the leadership of the CPC Central Committee and the State Council and the guidance of the CPC Committee of the People's Bank of China, foreign exchange authorities, following the principle of seeking progress while maintaining stability, focused on making breakthroughs in the reform, accelerating administration streamlining and power delegation and the "five shifts" in foreign exchange administration, and stressing risk prevention and control in 2015, thereby successfully completing the tasks of the year. The upgraded version of the reform of centralized operation and management of foreign exchange funds of MNCs has achieved initial success, the pilot program of the cross-border foreign exchange payment business of payment institutions has been rolled out nationwide, the facilitation of direct investment convertibility has been enhanced, the pilot program of the macro-prudential management of external debt has been carried out steadily, the ongoing and ex-post monitoring management has been improved, the crackdown on foreign exchange irregularities has strong deterring effect, the foreign exchange reserves operation and management system and mechanism have been improved, and therefore, foreign exchange authorities' capabilities to support economic restructuring, transformation and upgrading have been further strengthened. The year 2016 is the first year of the 13th Five-Year Plan period, the meeting stressed. Currently, China's economy and finance run stably, the economic development fundamentals remain optimistic, featuring strong potential and high resilience, the balance of payments is in equilibrium, and foreign exchange reserves are abundant, suggesting China's financial system is robust. In the year, foreign exchange authorities should follow the spirit of the 18th CPC National Congress, and the Third, Fourth and Fifth Plenums of the 18th CPC Central Committee, as well as the plans of the Central Economic Work Conference to serve the new normal of economic development. Following the guidance of the "five shifts" in foreign exchange administration under the principles of seeking progress while maintaining stability and breaking new grounds, foreign exchange authorities should continue to boost administration streamlining and power delegation and law-based administration, promote trade and investment facilitation, push forward the capital account convertibility in an orderly manner, intensify monitoring of the balance of payments, and refine the external debt and capital flows management system under the framework of macro-prudential management to enhance the level of operation and management of foreign exchange reserves and ensure a good start of the 13th Five-Year Plan period. Priorities of foreign exchange administration for 2016 were set at the meeting. First, the reform of the way of foreign exchange monitoring will be pressed ahead with, with ex-ante approval made light of, ongoing and ex-post management improved, and the accuracy and foresight of the monitoring analysis of the balance of payments enhanced to improve the monitoring efficiency. Second, the foreign exchange administration services will be further optimized, with the current account facilitation reform deepened, and foreign exchange administration for cross-border investment and financing enhanced to accelerate the development of the foreign exchange markets. Third, risk prevention and control will be intensified. Foreign exchange authorities are required to guide banks to handle foreign exchange business in line with the three business principles and to strictly perform their responsibilities for authenticity and legitimacy review, crack down on foreign exchange irregularities and maintain the normal order of the foreign exchange markets. Fourth, efforts will be made to ensure sound operation and management of China's foreign exchange reserves, with a focus on coordinating the goals of security, flows and value preservation and growth and further diversifying the use of foreign exchange reserves. Fifth, strict Party conduct will be fully enforced, with the "two responsibilities" performed, and Party building further intensified, with a focus on cleaning up undesirable work styles, upholding integrity, teambuilding and internal management. 2016-03-16/en/2016/0316/1195.html
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Q: Recent media reports say that China UnionPay will adopt a policy to impose a limit of USD 5,000 per transaction on overseas insurance merchants. Could you give us more details? A: The SAFE and China UnionPay do not change the policy on the use of bank cards with overseas insurance merchants. According to the Circular of the State Administration of Foreign Exchange on Issuing Merchant Category Codes for Prohibited and Restricted Use of Bank Cards Overseas (Huihan No. 19 [2004]) and the Circular of the State Administration of Foreign Exchange on Regulating the Management of Foreign-Currency Bank Cards (Huifa No. 53 [2010], the document updated and repealed the document of Huihan No. 19 [2004]), four merchant category codes (MCC) involve overseas insurance merchants. These merchants provide insurances under the current account that involves travel consumption, such as accident and illness insurances, and life insurance under the capital account that is of investment nature. Considering that domestic cardholders have the requirement for buying micro-insurance on their overseas trips or during their business communication, the SAFE defines insurance merchants as those allowed to accept a limited amount of payments by bank cards, while implementing the policy of the current account convertibility under bank cards. The amount per transaction between cardholders and such merchants should be no more than USD 5,000 or the equivalent, which can meet the reasonable requirements for buying micro-insurance and restrict investment insurance that involves the capital account. China UnionPay recently investigated overseas acquirers and found that some insurance merchants did not use the MCCs that are for merchants allowed to accept a limited amount of payments by bank cards and correspond to the industry codes, and required these acquirers to regulate the logo and use of MCCs to ensure the implementation results of regulatory policy and business rules. The SAFE has long supported and will continue to support cross-border use of bank cards to pay for normal travel consumption that is in compliance with regulations to facilitate international communication, and will not change the policy of buying foreign exchange domestically to pay for overseas consumption. Note: Merchant category code (MCC) is a code assigned to businesses based on their main business scope and industry classification. Q: Can domestic bank cards with logos of international card organizations such as VISA and MASTER be used with overseas insurance merchants? A: Both domestic bank cards with logos of international card organizations such as VISA and MASTER and of China UnionPay can be used with overseas insurance merchants. The SAFE has recently required the issuing banks of the domestic bank cards with logos of international card organizations such as VISA and MASTER to implement the regulations on merchants that are allowed to accept a limited amount of payments by bank cards in accordance with the compliance and authenticity requirements. Q: Can domestic cardholders evade the limit of USD 5,000 or the equivalent per transaction by swiping cards many times? A: Domestic cardholders are allowed to use their bank cards to pay for normal and reasonable insurance requirements involved in overseas trips and business communication. Given that cardholders may swipe cards many times to pay for insurance transactions for other purposes, the SAFE will work with bank card organizations and issuing banks to rigorously monitor cardholders and merchants suspected of getting involved in transactions paid for by swiping the cards many times, based on the records of bank card transactions. 2016-03-14/en/2016/0314/1192.html
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The State Administration of Foreign Exchange (SAFE) received and processed 48 NPC motions and CPPCC proposals in 2015, which involved operation and management of foreign exchange reserves, supporting Chinese enterprises to go global, providing financial support for the Belt and Road Initiative and boosting the development of cross-border e-commerce. The SAFE attached great importance to the processing efforts, arranged relevant work, and made great efforts to carry out the related tasks. As a result, the processing of the relevant proposals and motions for 2015 was completed successfully, which can be attributable to the following aspects: first, close attention from the leadership and thoughtful arrangements. With the significance of the proposals and motions processing stressed by the SAFE's Party Leadership Group, the leaders in charge of this processing effort convened a special meeting to make arrangements and raise requirements for the processing. Second, improved systems and standardized processing. A special measure has been developed to make sure the processing is institutionalized and standardized. Third, good coordination and communication to enhance the processing level. The SAFE took various measures to communicate with the delegates and further listened to their opinions and suggestions to ensure the quality of the processing. Fourth, strengthened training and rigorous overseeing. Training was provided for the persons processing the proposals and motions and supervision was improved to make sure every proposal and motion was replied. After the completion of the processing, a wrap-up meeting was held to identify and summarize the experience gained and good practices in this processing effort. The year 2016 was the first year of the Thirteenth Five-year Plan. The SAFE should take the processing effort of 2016 as a touchstone for the implementation of the gist of the 18th CPC National Congress, the Third, Fourth and Fifth Plenums of the 18th CPC Central Committee and the Central Economic Work Conference and continue to improve its work styles, so as to do well in the processing of the proposals and motions from the NPC and CPPCC in 2016. 2016-03-11/en/2016/0311/1189.html
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On February 3, 2016, Pan Gongsheng, deputy governor of the People's Bank of China and administrator of the State Administration of Foreign Exchange (SAFE), met with Andrew Rashbass, chief executive of Euromoney Institutional Investor, and Tony James, president of Blackstone, in Beijing. The current economic conditions in China should be viewed in an all-round and objective way, said Pan Gongsheng. Overall, China's economy is running in a reasonable range. Against the backdrop of the slowing world economy and global trade, and heightened fluctuations in the international financial markets, China maintained a mid-to-high growth rate of 6.9 percent in 2015, which was no easy job as China's economic aggregate had exceeded the basis point of USD 10 trillion and was relatively high compared with other countries. Pan stressed that China's slowing economic growth is attributed to the sluggish global economic growth as well as the Chinese government's active policy adjustment, and will be conducive to China's achievement of more sustainable and higher quality growth and to global economic rebalance. Going forward, China will focus on advancing the structural reform, especially the supply-side structural reform, to better balance economic growth, structural adjustment and risk prevention to achieve sustainable and stable economic development and make great contributions to global economic growth and rebalance. According to Pan, China's balance of payments stays stable, the cross-border capital flow risk is within control, and the RMB exchange rate remains stable against a basket of currencies, indicating there is no ground for sustainable depreciation of the RMB. While vigorously promoting trade and investment facilitation, China focuses on risk prevention, stressing the requirement of reviewing the authenticity and the level of compliance and cracking down on foreign exchange violations, and will not resort to capital controls as it did before. They also exchanged ideas on the current global economic and financial conditions. 2016-03-14/en/2016/0314/1190.html
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April 19, 2007 - At the end of 2006, China 's outstanding external debt reached USD 322.988 billion (excluding that of the Hong Kong SAR, Macao SAR, and Taiwan Province , the same below), an increase of USD 41.943 billion or 14.92% compared with that at the end of 2005. Specifically, the outstanding long- and medium-term debt (with the remaining term) stood at USD 139.360 billion, an increase of USD 14.458 billion or 11.58% compared with that at the end of 2005. The outstanding short-term debt (with the remaining term) was USD 183.628 billion, an increase of USD 27.485 billion or 17.60% compared with that at the end of 2005. The short-term debt accounted for 56.85% of the total. Among the USD 322.988 billion external debt, the outstanding registered external debt was USD 218.988 billion and the balance of trade credit was USD 104 billion. Among the outstanding registered external debt, the amount borrowed by ministries and commissions directly under the State Council was USD 34.354 billion, accounting for 15.69%; that of domestic-funded financial institutions was USD 70.363 billion, accounting for 32.13%; that of foreign-funded enterprises was USD 60.842 billion, accounting for 27.78%; that of foreign-funded financial institutions in China was USD 49.634 billion, accounting for 22.67%; that of Chinese-funded enterprises was USD 3.521 billion, accounting for 1.61%; and that of other institutions was USD 274 million, accounting for 0.12%. The amount of registered long- and medium-term external borrowing in 2006 was USD 26.033 billion, an increase of USD 1.364 billion or 5.53% over the previous year. The principal repayment was USD 17.899 billion, a decrease of USD 2.852 billion or 13.74% over the previous year. The interest payment under the long- and medium-term debt was USD 3.105 billion, an increase of USD 23 million or 0.75% compared with the previous year. Initial calculations reveal that our debt service ratio in 2006 was 2.09%, the ratio of outstanding external debts to foreign exchange income was 30.42%, the ratio of outstanding external debts to GDP was 12.30%, and the ratio of short-term external debts to foreign exchange reserves was 17.22%. All of these indexes are within the safety limits of international standards. 2007-04-19/en/2007/0419/836.html
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To push ahead with capital account convertibility and promote cross-border investment and financing facilitation, the State Administration of Foreign Exchange (SAFE) recently released the Regulations on Foreign Exchange Administration for Domestic Securities Investments by QFII (Announcement No. 1 of the SAFE in 2016, hereinafter referred to as the Regulations) to reform the foreign exchange administration system for qualified foreign institutional investors (QFII). The highlights of the Regulations include: first, easing the upper limit on the investment quota of a single QFII. The SAFE will no longer define a unified upper limit on the investment quota of a single institution and assign an investment quota (basic quota) to the institution in proportion to the size of its assets or assets under management (AUM). Second, simplifying quota approval management. A QFII's application for an investment quota that is within the basic quota will be subject to filing management, while the application for an investment quota that goes beyond the basic quota will be subject to SAFE approval. Third, further facilitating inward and outward remittances of funds. No requirements will be imposed on the deadline for the inward remittance of investment principal by a QFII. QFIIs will be allowed to subscribe and redeem open-end funds on a daily basis. Fourth, the lock-up period will be shortened from one year to three months, but the requirement that funds should be remitted out in batches and installments will remain unchanged, with the monthly total of outward remittance by a QDII no more than 20% of its domestic assets. The Regulations shall come into force as of the date of release. 2016-03-14/en/2016/0314/1194.html
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To support the implementation of the Measures for the Declaration of Balance of Payments Statistics, and further improve the data quality and efficiency of trade credit survey, the SAFE has recently released the Circular on the Issuance of the Trade Credit Survey System (Huifa No.1 [2016], the “Circular”) to amend the trade credit survey system. The Circular strikes a balance between improvement of statistical data quality and reduction of reporting burden, with the amendment as follows: 1. Simplifying survey indicators. Corporate credit and bank credit, and short and long terms will no longer be differentiated. The statistical and reporting methods and dimensions will be basically consistent with the Accounting System for Business Enterprises (ASBE). 2. Improving the timeliness of surveys. Surveys will be conducted on a monthly rather than quarterly basis, and both monthly and annual surveys will be conducted, but on different companies. Data will be reported on a monthly and annual basis respectively. 3. Focusing on key enterprises. Enterprises above designated size will be the targets of surveys. The total number of companies to be surveyed will be consistent with the number in the past surveys, but most enterprises will participate in the annual survey and limited ones in monthly surveys. The Circular will come into force on August 1, 2016. 2016-02-14/en/2016/0214/1188.html
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The People's Bank of China and the State Administration of Foreign Exchange (SAFE) released in November 2015 the Operational Guidelines for Funds Management in Cross-Border Issuance and Sales of Mainland and Hong Kong Securities Investment Funds (Guidelines), marking the official launch of the Mutual Fund Connect scheme. According to the Guidelines, the SAFE will disseminate the data on the inward and outward remittances for the cross-border issuance and sales of Mainland and HK funds on a monthly basis starting from February 2016. As at the end of January 2016, the cumulated net inward remittance from the issuance and sales of Mainland funds in Hong Kong amounted to RMB 21.5433 million, and the cumulated outward remittance for the issuance and sales of HK funds in the Mainland, RMB 40.1767 million. 2016-03-14/en/2016/0314/1191.html
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The Payment and Settlement Department of the People's Bank of China, the branches and foreign exchange administration departments of the State Administration of Foreign Exchange (SAFE) in all provinces, autonomous regions, and municipalities directly under the Central Government, and the SAFE branches in Shenzhen, Dalian, Qingdao, Xiamen and Ningbo, and the designated Chinese-funded foreign exchange banks: To actively support the development of cross-border e-commerce, and guard against the risksarising fromonline foreign exchange payments, the SAFE has formulated the Guidance on the Pilot Program of Cross-border Foreign Exchange PaymentBusiness Through Payment Institutions ("Guidance", see Annex) based on the lessons and experience gained in the preliminary stage to pilot cross-border foreign exchange payment business through payment institutions across the country, which is hereby printed and distributed for implementation. The SAFE branches and foreign exchange administration departments (hereinafter referred to as the "SAFE branches") shall select the payment institutions with actual demand, compliant operations and mature business and technical conditions to participate in the pilot program of cross-border foreign exchange payment business, and register them on the List of Enterprises Making Foreign Exchange Receipts and Payments under Trade, in accordance with the Guidance. The SAFE branches shall strictly review the payment institutions participating in the pilot program in accordance with the principle of prudence, and improve the quality of such review by strengtheningtheir communication with the payment and settlement administration departments of the local branches of the People's Bank of China (PBC) through ex-ante consultation or ex-post notification, as the case may be. The SAFE branches shall, upon receipt of the Circular, promptly forward it to the central sub-branches (sub-branches), local commercial banks and foreign-funded banks under their respective jurisdiction. All designated Chinese-funded foreign exchange banks shall, upon receipt of the Circular, promptly forward it to their branches. Any problemsthat occur during the implementation of the policy shall be promptly reported to the Current Account Management Department of the State Administration of Foreign Exchange. Appendix: Guidance on the Pilot Program of Cross-border Foreign Exchange Payment Business through Payment Institutions State Administration of Foreign Exchange January 20,2015 Appendix Guidance on the Pilot Program of Cross-border Foreign Exchange Payment Business Through Payment Institutions Chapter One General Provisions Article 1. In order to facilitate domestic institutions and individuals to carry out e-commerce transactions via the Internet, regulate cross-border foreign exchange payment business through payment institutions, and guard against the risks arising from cross-border capital flows through the Internet, this Guidance is hereby formulated in accordance with the Regulations of the People's Republic of China on Foreign Exchange Administration, the Measures for the Administration of Payment Services of Non-financial Institutions, and other relevant provisions. Article 2.Cross-border foreign exchange payment business through payment institutionsrefer to the centralized receipts and payments, and relevant settlement and sales of foreign exchange funds that are involved in online cross-border payments made by payment institutions through banks to the parties of e-commerce transactions (trade in goods or trade in services). Article 3.Payment institutions providingcross-border foreign exchange payment services shall be subject to the supervision and administrationof the SAFE and its branches ("foreign exchange authorities"), and promptly submit relevant business data in accordance with relevant regulations. When serving the payment institutions, banks shall strictly examine the qualifications and business scopes of the payment institutions with reasonable diligence, refuse to handle the abnormal transactions, and ensure the prompt and accurate input of relevant data. Domestic institutions and individuals shall not obtain or transfer foreign exchange funds with fictitious transaction, or evade foreign exchange regulation by split-up. Entities engaged in cross-border e-commerce shall also comply with the laws and regulations of other relevant departments of the state. Chapter Two Application for Participation in the Pilot Program Article 4. A payment institution may join the pilot program of cross-border foreign exchange payment business after registering on the List of Enterprises Making Foreign Exchange Receipts and Payments under Trade. Any payment institution applying for the registration on the List of Enterprises Making Foreign Exchange Receipts and Payments under Trade shall satisfy the following requirements: (I) Holder of the Payment Business License issued by the People's Bank of China (PBC), with "online payment" included in the permitted business scope; (II) No material violation of the regulations on the RMB and foreign exchange administration in the past 2 years; (III) With a sound organizational structure, and sound business process rules and risk management systems; (IV) With the technical conditions for collecting and keeping the transaction data, and the ability to ensure the authenticity and security of the transactions. Article 5. Any payment institution applying for the registration on the List of Enterprises Making Foreign Exchange Receipts and Payments under Trade shall present the following documents to the foreign exchange authority at the place of incorporation: (I) Written application, stating the applicant's informationsuch as name, place of incorporation, registered capital, equity structure, organizational structure, and the types and scopes of existing payment business and the cross-border foreign exchange payment business being applied for; (II)Business operation plan, including business processing procedures (specify in detail the complete procedures of transactions, exchanges and payments by business type), customer real-name system management, review of the authenticity of transactions, declaration of the balance of payments statistics, data collection and submission, system construction, data interface between system and banks, system emergency response plan, foreign exchange reserve account management, risk control related to the business conducted, internal operational rules, and compliance management; (III)The duplicates and photocopies of the Payment Business License, Business License for Enterprise as Legal Person, and Organization Code Certificate; (IV)Cooperation agreement with bank(s); (V) Other materials required by the foreign exchange authority. Article 6. The SAFE branches and foreign exchange administration departments (hereinafter referred to as the "SAFE branches") shall review the application materials submitted by the payment institutions in accordance with the Guidance, and issue official written documents to the qualified payment institutions within 20 working days and report them to the SAFE, and register the payment institutionsapplying to engage in cross-border foreign exchange payments under trade in goods on the List of Enterprises Making Foreign Exchange Receipts and Payments under Trade. The payment institutions that have engaged in the pilot business before the implementation of this Guidance are not required to make application again. The SAFE branches at the places of their incorporation shall uniformly handle the registration for the List of Enterprises Making Foreign Exchange Receipts and Payments under Trade. During the pilot period, any payment institution shall complete filing procedures with the SAFE branches at the place of its incorporation by presenting the operation plan or the cooperation agreement with banks in relation to the new business in case of any change to the informationsuch as business scope and opening bank for the foreign exchange reserves. Chapter Three Business Management Article 7. Any payment institution shall strictly review the authenticity of the identity information of customersto make cross-border foreign exchange payment business through it, and keep relevant information for 5 years for future reference. The information of individual customers to be kept includes but is not limited to name, nationality and valid ID number; the information of institutional customers to be kept includes but is not limited to name and organization code. Where a payment institution develops overseas merchants independently, it shall guarantee the authenticity and legitimacy of the overseas merchants in accordance with the principles of Know Your Customer, Understand Your Business, and Due Diligence. Article 8. The cross-border foreign exchange payment business shall be conducted for true and legitimate trade in goods or in services. Payment institutions shall not provide cross-border foreign exchange payment services to the following trading activities: the trade in goods or the trade in services that is not in compliance with the import and export management regulations of the state; the commodity trade without consideration generally accepted by the market, and the intangible commoditytrade with an unclear pricing mechanism and potential risks; the projects and operating activities that may endanger the state and society or harm the social and public interests; and the projects expressly prohibited by laws and regulations, or the rules and regulations of the PBC and foreign exchange authorities. Article 9. Where a payment institution participates in the pilot program of cross-border foreign exchange payment business, the amount of a single transaction shall not exceed the equivalent of USD50,000, unless otherwise provided. Where a payment institution fails to sufficiently verify the completion of transactions or fails to implement, against relevant merchants, the classified management of the enterprises on the List of Enterprises Making Foreign Exchange Receipts and Payments under Trade in Goods in accordance with relevant regulations, the foreign exchange authority may downgrade the limit on a single transaction of the said payment institution to the equivalent of USD10,000. Article 10. A payment institution may provide centralized receipts, payments, settlement and sales of foreign exchange for customers, and restore transaction information on a transaction-by-transaction basis in accordance with the requirements of this Guidance. The payment institution shall complete the settlement and sales of foreign exchange on the first working day (T+1) following the date of receiving funds (T). The payment institution may handle net settlement provided it satisfies the requirements for restoring transaction information on a transaction-by- transaction basis. Article 11.In providing cross-border foreign exchange payment services, a payment institution shall allow its customers to make payment in RMB or self-owned foreign exchange. When a customer transfers foreign exchange to the payment institution, the bank shall require the customer to provide the materials evidencing the authenticity of online transactions, which contain information such as the transaction amount and the name of the payment institution, provide the transfer service after verifying the account name of the payment institution and the amount, and indicate the wording of "Online Cross-border Foreign Exchange Payment & Transfer" in the transaction remark. Article 12.In providing foreign exchange settlement and sales services to its customers, a payment institution shall use the posted exchange rate, and shall not change the exchange rate by itself. The payment institution shall reach prior agreements with its customers in respect of service fees and the sharing of exchange gains or losses involved in transaction refunds. Chapter Four Account Management Article 13. Any payment institution shall strictly distinguish the funds under customers’ foreign exchange reserve accounts and its own foreign exchange funds and shall not mix them for use. The payment institution shall open accounts for and use its own foreign exchange funds in accordance with the existingregulations on the administration of institutions' foreign exchange. Article 14. A payment institution shall open a foreign exchange reserve accountwith banksin accordance with the existing regulations relating to foreign exchange account management by presenting a written document evidencing the registration on the List of Enterprises Making Foreign Exchange Receipts and Payments under Trade issued by the foreign exchange authority at the place of its incorporation; the name of the account shall be ended with “PIA” (Payment Institute Account). The payment institution shall provide foreign exchange settlement and sales and cross-border payment and receipt services to customers through the foreign exchange reserve account. The reserve account management shall be in compliance with the PBC's regulations on reserve account management. Article 15. The receipts under a foreign exchange reserve account include foreign exchange transfer from the foreign exchange reserve account of the same name, a domestic payer’s transfer of foreign exchange or inward transfer of foreign exchange purchased, foreign exchange transfer from an overseas payer, and foreign exchange returnedthrough the same route and in the same currency for reasons such as transaction failure; while the payments from the account include foreign exchange transfer to a foreign exchange reserve account of the same name, transfer of foreign exchange to a domestic payee, transfer of settledforeign exchange to the RMB reserve account or the payee’s RMB account, remittance to an overseas payee, and the foreign exchange returnedthrough the same route and in the same currency for reasons such as transaction failure. Cash withdrawal or deposit, and prepayment or pre-deposit without an underlying transaction are not allowed under foreign exchange reserve accounts. However, foreign exchange transfer in accordance with regulations is acceptable between the foreign exchange reserve account of the payment institution and its own foreign exchange account for reasonssuchas operating profit or loss. Article 16.A payment institution shall open a foreign exchange reserve account with a commercial bank qualified for deposit and management of customers’ reserves. The foreign exchange and RMB reserves shall be deposited in and managed by the same bank, while the partner bank for foreign exchange reserves can be selected at its sole discretion and based on its actual needs. Article 17. The foreign exchange reserve accounts of payment institutions shall be managed in the foreign exchange account management information system, under the category “foreign exchange reserve accounts of payment institutions (1603)”, and banks shall input and report data to the foreign exchange authoritieson a timely basis. Chapter Five Information Collection Article 18. A payment institution shall submit relevant business data and information in accordance with the requirements of this Guidance, and ensure the accuracy, completeness and consistency of the data. Banks shall submit relevant information based on the data provided by payment institutions, in accordance with relevant regulations on the declaration of the balance of payments and on the submission of foreign exchange settlement and sales information. Except for the information required to be restored on a transaction-by-transaction basis, the information of other transactions shall be accurately submitted based on the information on the actual business of the banks. The transaction information involving netting shall also be submitted on a restoration basis, and the specific submission requirements shall be implemented in accordance with Articles 20, 21 and 22 under this Guidance. Article 19.In handling cross-border foreign exchange payment business, a payment institution shall acquire the true transaction information, collect the detailed data of each transaction under the principles of completeness and traceability, and keep them for future reference. The detailed data under trade in goods shall, in principle, include the name and quantity of the subject matter, transaction currency, amount, parties of transaction and countries they are from, and order time; the detailed data under trade in services shall, in principle, include the type of service, specific transaction information (such as the scheduled flight and time under air ticket, the hotel name and time of accommodation, letter of admission under overseas study, etc.), quantity, transaction currency, amount, parties of transaction and their location, and order time. Article 20. A payment institution shall declare the following two categories of data for the balance of payments statistics in accordance with the existing regulations on the declaration of foreign-related receipts and payments data: (I) data of actual receipts and payments by the payment institution during centralized receipts and payments or net settlement (hereinafter referred to as the “data of actual receipts and payments”); and (II) data of original receipts and paymentsrestoredtransaction-by-transaction prior to centralized receipts and payments or net settlement (hereinafter referred to as the “restored data”). For declaration of data of actual receipts and payments, the payment institution shall indirectly declare the balance of payments statistics according to actual transactions with banks, while the banks shall indicate the transaction code as “999999” for the actual receipts and payments, and the declaring entity as the payment institution. Where the actual receipts and payments become zero after net settlement, the payment institution shall report a virtualized transaction settled at zero, in which the names of payer and payee are the payment institution itself, the transaction code is “999998”, the nationality is “China”, and other required items are declared based on situations or as “N/A” (in capital letters). For declaration of restored data, the payment institution shall, on the same day of declaring data of actual receipts and payments, provide the datarestored transaction-by-transactionunder the principle of full receipt and full payment, and declare through banks the restored data on cross-border receipts and payments of customers actually using foreign exchange. Where the amount of customer’s single transactionrestored is below the limit for exemption from balance of payments declaration, the payment institution shall, based on the nature of actual transactions, combine the data of the transactions of same nature (i.e., with the same transaction code) into one transaction, and declare in its name the restored datatransaction by transaction after the combination. Where the amount of customer’s single transactionrestored is above the limit for exemption from balance of payments declaration, the payment institution shall declarein the names of customersthe restored data transaction by transaction. Article 21. A payment institution shall provide or fill in on a centralized basis the basic information and declaration information of restored data, in a manner determined through consultation with banks; filling in the printed declaration form is not compulsory. A domestic bank shall fill in the transaction code and transaction remarksbased on the nature of actual transactions, prepare the declaration number based on the date of actual receipt and payment, and indicate the “bank transaction number” of restored data as the declaration number of the corresponding data of centralized receipt and payment, in order to establish a correlation between the data of actual receipts and payments and the restored data. The domestic bank shall complete reporting of the basic information of the restored data prior to 12:00 at noon of the 1st working day (T+1) following the date of actual receipt and payment by the payment institution (T); and complete reporting of the declared information of the restored data prior to 12:00 at noon of the 5th working day (T+5). Article 22. A payment institution shall, in accordance with the existing regulations on foreign exchange settlement and sales, provide transaction-based information of foreign exchange purchase or settlement through a bank within the prescribed time limit, while the bank shall report the statisticsstatement of foreign exchange settlement and salesin accordance with the existing regulations. For foreign exchange settlement and sales transactions with individuals, the bank shall, based onthe data provided by the payment institution, record on a transaction by transaction basis in the Management System for Individual Foreign Exchange Settlement and Salesasingle transactionthat is worth the equivalent of USD500 and below after summation by currency and nature of transaction on behalf of the payment institution, and a single transaction that is worth theequivalent of more than USD 500 within 5working days following the date of the transaction (T+5). The payment institution shall not add the amount of foreign exchange settlement and sales to individuals under cross-border foreign exchange payment to the annual aggregate of foreign exchange settlement and sales to individuals. Article 23. A payment institution shall, by the 10th day of each month, report through the forms system to the foreign exchange authority at the place of its incorporation the total amount and number of cross-border foreign exchange payments by customers. For customers with monthly foreign exchange receipts and payments exceeding the equivalent of USD 200,000, the paymentinstitution shall report their transactions as those in a significant accumulated amount of receipts and payments. The paymentinstitution shallalso report to the foreign exchange authority on a timely basis in case of abnormalities or high risksas the transaction is being carried out. The payment institution shall submit the annual pilot summary report as required by the local SAFE branch. Chapter Six Supervision and Verification Article 24. The SAFE branches shall prudentially supervise the pilot business, and carry out offsite and onsite verifications on the foreign exchange payment business of the payment institutions under their respective jurisdiction in accordance with this Guidance and relevant regulations on foreign exchange administration. The SAFE branches at the places of the incorporation of the payment institutions shall be chiefly responsible for verifying the payment institutions. The payment institutions and their opening banks shall be obliged to cooperate with the supervision and administration of the foreign exchange authorities. Article 25. The SAFE branches may order the payment institutions to carry out self-checks of the abnormal transactions discovered during their routine monitoring. The payment institutions shall complete the self-checks in time in accordance with the requirements of the SAFE branches, and submit the self-check report. Article 26. The SAFE branches shall independently make arrangements for the onsite verifications or inspections of the payment institutions under their jurisdiction, based on the aggregate of foreign exchange payments and theratiosof business volume and business characteristics of the payment institutionsunder their jurisdiction. The contents of onsite verifications shall include but be not limited to review of the information related to the payment institutions, the authenticity of transactions, information collection and retention, and the scope of actual business. Article 27. Where a payment institution providing cross-border foreign exchange payment services fails to pass the authenticity reviewor satisfy the requirements on information collection and retention, the foreign exchange authority shall have the right to adjust the business scope and transaction limit of the payment institution or suspend its qualification for handling the cross-border foreign exchange payment business. After the payment institution make corrections, it shall be re-approved by the SAFE branch at its place of incorporation before resuming the pilot business. Article 28. The foreign exchange authorities shall punish the payment institutions that violate the relevant regulations of this Measure inhandling foreign exchange payment business, in accordance with the Regulations of the People's Republic of China on Foreign Exchange Administration and other laws and regulations, andwhere the circumstances are serious, shall disqualify them for handling foreign exchange payment business. Article 29. The Circular shall come into effect as of the date of issuance, and the Circular of the General Affairs Department of the State Administration of Foreign Exchange on Implementing the Pilot Program of Foreign Exchange PaymentsThrough Payment Institutions for Cross-border E-Commerce (Huizongfa No.5 [2013]) shall be repealed at the same time. Article 30. This Guidance shall be construed by the SAFE. 2015-03-16/en/2015/0316/756.html
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The Decision of the State Council on the Revision of the Measures for the Collection of Statistics and Declaration of the Balance of Payments is hereby promulgated and shall be implemented as of January 1, 2014. Premier Li Keqiang November 9, 2013 Decision of the State Council on the Revision of the Measures for the Collection of Statistics and Declaration of the Balance of Payments The State Council has decided to revise the Measures for the Collection of Statistics and Declaration of the Balance of Payments (the Measures) as follows: I. Article 2 is revised as “All economic transactions between Chinese residents and non-Chinese residents and external financial assets and liabilities of Chinese residents shall be subject to the statistics and the declaration of the balance of payments.” II. Article 7 is revised as “Chinese residents and non-Chinese residents carrying out economic transactions within the territory of China shall declare the information on the balance of payments in compliance with the relevant regulations in a timely, accurate, and complete manner.” III. Articles 9 and 10 are combined into Article 9: “Institutions within the territory of China that provide services such as registration, settlement, and trusteeship, and dealers engaging in external transactions of securities, futures, and options on a self-run basis or on behalf of their clients shall declare to the State Administration of Foreign Exchange or its branches/sub-branches information about the external transactions, receipts, payments, and dividend payouts.” IV. Article 11 is revised as Article 10 which reads “Financial institutions within the territory of China shall declare their self-run external business directly to the State Administration of Foreign Exchange or its branches/sub-branches (including their external financial assets, liabilities, and their variations, profits and receipts and payments of interest, receipts and payments of external financial services, and other receipts and payments), and shall fulfill the obligations in their role as an intermediary through which Chinese and non-Chinese residents declare their statistics and the balance of payments to the relevant authorities.” V. Article 13 is revised as Article 12, which reads “Foreign-funded enterprises within the territory of China, enterprises with direct investments outside the territory of China, and other non-financial institutions with external financial assets and liabilities must declare directly to the State Administration of Foreign Exchange or its branches/sub-branches information regarding their external financial assets, liabilities, and their variations, and profits and receipts and payments of dividends and interest.” VI. An article is added as Article 13 which reads “Individual Chinese residents who have external financial assets and liabilities shall declare the relevant information about their external financial assets and liabilities in accordance with the relevant regulations of the State Administration of Foreign Exchange.” VII. Article 15 is revised as “The State Administration of Foreign Exchange or its branches/sub-branches has the right to check and verify the information declared by Chinese and non-Chinese residents; those making the declarations and the relevant institutions or individuals shall provide the relevant materials and shall make arrangements for the inspections and verifications. VIII. A paragraph is added to Article 16 as paragraph 2 which reads “Banks, dealers, and institutions that provide services such as registration, settlement, and trusteeship shall keep strictly confidential the specific declared data about which they have knowledge during the handling of the relevant business.” IX. Article 17 and 18 are combined into Article 17, which reads “Chinese and non-Chinese residents who fail to provide the statistics and declaration of the balance of payments in accordance with the relevant regulations shall be penalized by the State Administration of Foreign Exchange or its branches/sub-branches in accordance with Article 48 of the Regulations on Foreign Exchange Administration of the People’s Republic of China.” X. Article 19 is revised as Article 18, which reads “Statisticians who violate Article 16 of the Measures shall be penalized in accordance with the law. Banks, dealers, and institutions that provide services such as registration, settlement, and trusteeship that violate Article 16 of the Measures shall be investigated according to the law by the State Administration of Foreign Exchange or its branches/sub-branches regarding their legal responsibilities.” The Decision also made some adjustments and revisions to the sequence of the paragraphs and to the specific text of the Measures. The Decision will be implemented as of January 1, 2014. The Measures for the Collection of Statistics and Declaration of the Balance of Payments are revised and promulgated according to this Decision. Measures on the Collection of Statistics and Declaration of the Balance of Payments (Approved by the State Council on August 30, 1995, promulgated by the People’s Bank of China on September 14, 1995 and revised on November 9, 2013 according to the Decision of the State Council on the Revision of the Measures for the Collection of Statistics and Declaration of the Balance of Payments) Article 1 In order to improve the statistics on the balance of payments, these Measures are formulated in accordance with the Statistical Law of the People’s Republic of China. Article 2 All economic transactions between Chinese and non-Chinese residents and external financial assets and liabilities of Chinese residents shall be subject to the collection of statistics and declaration of the balance of payments. Article 3 “Chinese residents” as referred to in the Measures refer to: 1. Natural persons who have stayed in China for more than one year, with the exception of foreign and Hong Kong, Macao, and Taiwan students in the territory, medical personnel, and foreign workers in foreign embassies and consulates and their families. 2. Chinese personnel going abroad for a short period of time (who remain in foreign countries/regions for less than a year), personnel studying in foreign countries and regions, personnel seeking medical advice in foreign countries and regions, and personnel in Chinese embassies and consulates in foreign countries and regions and their family members; 3. Business entities and public institutions established in accordance with law within the territory of China (including foreign-funded enterprises and foreign financial institutions) and agencies of overseas corporations in China (excluding agencies of international organizations in China and foreign embassies and consulates in China); 4. Chinese state organs (including Chinese embassies and consulates), groups, and troops. Article 4 The Measures are applicable to all regions within the territory of China, including bonded areas and bonded warehouses within the territory of China. Article 5 The State Administration of Foreign Exchange is responsible for organizing and implementing the statistics and the declaration of the balance of payments and carrying out supervision and verification in compliance with the procedures as stipulated in the Statistical Law of the People’s Republic of China; collecting, calculating, and disclosing the information on the balance of payments and international investments; formulating and revising the detailed rules of the Measures; and compiling and issuing the declaration forms and the statistical statement on the balance of payments. The relevant government departments shall assist with the statistics and the declaration of the balance of payments. Article 6 The statistics and the declaration of the balance of payments shall follow the principle that the declaration is made by the transactional entity, with a combination of indirect and direct declarations and deal-by-deal declarations as well as regular declarations that are adopted for the statistics and the declaration. Article 7 Chinese residents and non-Chinese residents carrying out economic transactions within the territory of China shall declare the information on the balance of payments in compliance with the relevant regulations in a timely, accurate, and complete manner. Article 8 Chinese residents who carry out transactions with non-Chinese residents through domestic financial institutions shall declare the content of the transactions through the financial institutions to the State Administration of Foreign Exchange or its branches/sub-branches. Article 9 Institutions within the territory of China that provide services such as registration, settlement, and trusteeship and dealers engaging in external transactions of securities, futures, and options on a self-run basis or on behalf of their clients shall declare to the State Administration of Foreign Exchange or its branches/sub-branches information about the external transactions, receipts, payments, and dividend payouts. Article 10 Financial institutions within the territory of China shall declare their self-run external business directly to the State Administration of Foreign Exchange or its branches/sub-branches (including their external financial assets, liabilities, and their variations, profits and receipts and payments of interest, receipts and payments of external financial services and other receipts and payments), and shall fulfill the obligations in their role as an intermediary through which Chinese and non-Chinese residents declare their statistics and the balance of payments to the relevant authorities. Article 11 Chinese non-financial institutions that open accounts in China shall declare directly to the State Administration of Foreign Exchange or its branches/sub-branches any transactions conducted with non-Chinese residents through overseas accounts and the balance in their accounts. Article 12 Foreign-funded enterprises within the territory of China, enterprises with direct investments outside the territory of China, and other non-financial institutions with external financial assets and liabilities must declare directly to the State Administration of Foreign Exchange or its branches/sub-branches the information about their external financial assets, liabilities, and their variations, and profits and receipts and payments of dividends and interest. Article 13 Individuals who are Chinese residents and who have external financial assets and liabilities shall declare the relevant information about their external financial assets and liabilities in accordance with the relevant regulations of the State Administration of Foreign Exchange. Article 14 The State Administration of Foreign Exchange or its branches/sub-branches can conduct sample surveys or general surveys on the balance of payments. Article 15 The State Administration of Foreign Exchange or its branches/sub-branches has the right to check and verify the information declared by Chinese and non-Chinese residents; those making the declarations and the relevant institutions and individuals shall provide the relevant materials and facilitate the inspections and verifications. Article 16 The State Administration of Foreign Exchange or its branches/sub-branches shall keep strictly confidential the specific data that is declared and which is only to be used for the statistics on the balance of payments. Unless otherwise provided for by the law, the statisticians for the balance of payments shall not provide the specific declared data in any form to any institutions and individuals. Banks, dealers, and institutions that provide services such as registration, settlement, and trusteeship shall keep strictly confidential the specific declared data about which they have knowledge during the handling of the relevant business. Article 17 Chinese and non-Chinese residents who fail to carry out the collection of the statistics and the declaration of the balance of payments in accordance with the relevant regulations shall be penalized by the State Administration of Foreign Exchange or its branches/sub-branches in accordance with Article 48 of the Regulations on Foreign Exchange Administration of the People’s Republic of China.” Article 18 Statisticians who violate Article 16 of the Measures shall be penalized in accordance with the law. Banks, dealers, and institutions that provide services such as registration, settlement, and trusteeship that violate Article 16 of the Measures shall be investigated by the State Administration of Foreign Exchange or its branches/sub-branches regarding their legal responsibilities according to the law. Article 19 The State Administration of Foreign Exchange will formulate the Detailed Rules for Implementation of the Measures for the Collection of Statistics and the Declaration of the Balance of Payments. Article 20 The Measures shall enter into effect as of January 1, 1996. 2013-11-22/en/2013/1122/740.html