Recently, the State Administration of Foreign Exchange has promulgated the Circular on Issues concerning Foreign Exchange Administration of Foreign Traders and Foreign Brokerage Agencies Trading in Specific Varieties of Futures in China (the "Circular") for implementation as of August 1, 2015.
The Circular specifies the policies on foreign exchange administration of foreign investors trading in domestic commodity futures and simplifies the requirements for account opening, fund exchange, and data submission involved in the trading. Main contents include the following: firstly, specify foreign exchange account management requirements for all transaction participants, and conduct special account management and close-end operation of funds. Secondly, specify that funds used in futures trading by foreign investors do not occupy short-term external debt indicators of banks. Thirdly, facilitate fund exchange. Foreign investors may directly handle foreign exchange clearing and purchase with deposit banks pursuant to actual demands such as futures transaction margin and gains and losses clearing, and funds may be directly transferred after the foreign exchange clearing and purchase. Fourthly, simplify data submission. Receipts and expenditures of foreign-related futures transactions and relevant transaction data shall be uniformly submitted by deposit banks and exchanges through systems.