Recently, the Shanghai Head Office of the People's Bank of China ("PBC") has issued the Guide on Registration of Overseas Investors for Northbound Trading in the Bond Connect (the "Guide"), with immediate effect.
The Guide stipulates that eligible overseas investors may entrust the China Foreign Exchange Trade System ("CFETS"), domestic bond custodian institutions and clearing agents for the interbank bond market that are recognized by the PBC, or other institutions as recognized by the PBC as the registration agents to apply for registration with the PBC Shanghai Head Office. For the purpose of registration, overseas investors under the Northbound Trading need to satisfy specific requirements in three aspects, such as "registration materials provided by overseas investors". Further, the Guide makes it clear that the PBC Shanghai Head Office will, within three working days upon acceptance of an application for registration, process such application pursuant to certain conditions and procedures, and then issue a registration notice. In the event that important information about an overseas investor, say the name of the institution, changes, the overseas investor should apply for registration for such change in a timely manner. Moreover, all related institutions are required to submit to the PBC Shanghai Head Office particulars on the business of overseas investors through the Northbound Trading of last month within the first five working days each month, and bear responsibilities for the authenticity of data submitted.