Regulations of the People's Republic of China on Foreign Exchange Administration (Revised in 2008)
Regulations of the People's Republic of China on Foreign Exchange Administration (Revised in 2008)
Regulations of the People's Republic of China on Foreign Exchange Administration (Revised in 2008)
Order of the State Council No.532
August 5, 2008
(Issued by Order No. 193 of the State Council on January 29, 1996, revised in accordance with the Decision of the State Council to Revise the Regulations of the People's Republic of China on Foreign Exchange Administration made on January 14, 1997, and adopted after being revised at the 20th executive meeting of the State Council on August 1, 2008)
Chapter I General Provisions
Article 1 These Regulations are formulated to strengthen the administration of foreign exchange, maintain the balance of international payments, and promote the healthy development of the national economy.
Article 2 The State Council foreign exchange administrative department and its branches (hereinafter referred to as the foreign exchange administrative authorities) shall be responsible for the administration of foreign exchange in accordance with the law and implementing these Regulations.
Article 3 The term "foreign exchange" as used in these Regulations refers to the following payment instruments and assets that can be used for international settlements and are expressed in a foreign currency:
1. Cash in any foreign currency, including notes and coins;
2. Foreign currency payment orders and payment instruments, including bills, bank deposits, bank cards, etc.;
3. Foreign currency negotiable securities, including bonds, stocks, etc.;
4. Special drawing rights; and
5. Other foreign currency assets.
Article 4 These Regulations shall apply to foreign exchange receipts and disbursements and to the foreign exchange business activities of domestic organizations and individuals, foreign organizations, and foreign individuals.
Article 5 The state will not impose any restrictions on international payments or transfers on current account.
Article 6 The state shall implement a system for the compilation of statistics and reports on international payments.
The State Council foreign exchange administrative department shall carry out statistical and monitoring activities with respect to international receipts and payments and periodically publish international income and payment information.
Article 7 Financial institutions engaged in foreign exchange business shall open client foreign exchange accounts in accordance with State Council foreign exchange administrative department provisions and handle foreign exchange business through such foreign exchange accounts.
Financial institutions engaged in foreign exchange business shall, in accordance with the law, report all client foreign exchange receipts and payments and all client account changes to the relevant foreign exchange administrative authority.
(Relevant articles: Legislation 1)
Article 8 Unless otherwise provided for by the state, no foreign currency shall be circulated within the territory of China and no foreign currency shall be used for price calculation or settlement purposes.
Article 9 The foreign exchange income of domestic organizations and individuals may be remitted back to China or deposited outside China. The State Council foreign exchange administrative department shall, according to the circumstances of international receipts and payments and foreign exchange administrative requirements, make provisions relating to the requirements, periods and other aspects of such remittances and deposits.
Article 10 The State Council foreign exchange administrative department shall, in accordance with the law, hold, manage and operate the foreign exchange reserves of the state and shall adhere to the principles of security, liquidity and increase in value.
Article 11 Where any material imbalance in international receipts and payments occurs or may occur, or any serious economic crisis occurs or may occur in China, the state may implement the necessary safeguards, controls and other measures with respect to international receipts and payments.
Chapter II Administration of Foreign Exchange on Current Account
Article 12 International receipts and payments on current account shall be based on genuine and lawful transactions. Financial institutions engaged in foreign exchange settlement and sales business shall, in accordance with State Council foreign exchange administrative department provisions, examine in a reasonable manner the genuineness of documents involved in a transaction and the consistency of such documents with the relevant international receipts and payments.
The foreign exchange administrative authorities shall have the power to supervise and inspect the matters specified in the preceding paragraph.
Article 13 Current account foreign exchange income may, in accordance with relevant provisions of the state, be retained or sold to any financial institution engaged in foreign exchange settlement and sales business.
Article 14 Foreign exchange payments from current account shall, in accordance with State Council foreign exchange administrative department provisions relating to foreign exchange payments and purchases, be made out of own foreign exchange funds on the strength of valid documents or be made with foreign exchange purchased from any financial institution engaged in foreign exchange settlement and sales business.
Article 15 The State Council foreign exchange administrative department shall make provisions relating to limits for foreign currency cash to be carried and reported for exit or entry purposes.
Chapter III Administration of Foreign Exchange on Capital Account
Article 16 Any foreign organization or individual that seeks to make a direct investment in China shall, after obtaining approval from the relevant competent department, make the appropriate registrations with the relevant foreign exchange administrative authority.
Any foreign organization or individual that seeks to engage in the issuance or trading of negotiable securities or derivatives shall comply with state provisions relating to market access and shall make the appropriate registrations in accordance with State Council foreign exchange administrative department provisions.
Article 17 Any domestic organization or individual that seeks to make a direct investment overseas or engage in the issuance or trading of negotiable securities or derivatives overseas shall make the appropriate registrations in accordance with State Council foreign exchange administrative department provisions.
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