The National Association of Financial Market Institutional Investors ("NAFMII") has recently issued the Guidelines for Debt Financing Instrument Business of Overseas Non-financial Enterprises (for Trial Implementation) (the "Guidelines"), immediately effective from the date of issuance.
The Guidelines set out major requirements in three aspects as below. First, in terms of information disclosure, the Guidelines clearly specify essential conditions on registration for overseas enterprises, information disclosure documents duly published at the issuance stage, information disclosure documents duly published during the maturity, material events, timepoint of information disclosure, language used for the disclosure, etc. Second, as for the use of funds raised, the Guidelines clarify, in a separate chapter, the use of funds raised by non-financial enterprises via their so-called "panda bonds" (which refer to RMB-denominated bonds that are offered by non-Chinese issuers and sold in China) , adding that funds raised through panda bonds may be used either at home or abroad, pursuant to relevant laws, regulations and regulatory requirements, and that opening an account for funds raised, remitting such funds across borders, reporting information regarding the funds, among other matters, shall comply with relevant provisions of the People's Bank of China ("PBC") and the State Administration of Foreign Exchange ("SAFE"). Third, with regard to requirements for intermediary agencies, it is stated that investors shall make independent decisions on investment value and bear investment risks on their own, while intermediary agents delivering agent services, as well as their staff members, shall diligently and responsibly fulfill their obligations as required and as agreed, and bear the corresponding legal liability.