Circular on Printing and Distributing the Interim Measures for the Participation of Insurance Funds in Financial Derivatives Trading
Circular on Printing and Distributing the Interim Measures for the Participation of Insurance Funds in Financial Derivatives Trading
Circular on Printing and Distributing the Interim Measures for the Participation of Insurance Funds in Financial Derivatives Trading
Bao Jian Fa [2012] No. 94
October 12, 2012
All insurance group (controlling) companies, insurance companies and insurance assets management companies,
For the purpose of regulating participation of insurance funds in financial derivatives trading, preventing capital operational risks and protecting insurance participants' legal rights and interests, the China Insurance Regulatory Commission formulates the Interim Measures for the Participation of Insurance Funds in Financial Derivatives Trading, and hereby prints and distributes to you for your compliance and implementation.
Interim Measures for the Participation of Insurance Funds in Financial Derivatives Trading
Chapter I General Provisions
Article 1 For the purpose of regulating participation of insurance funds in financial derivatives trading, preventing capital operation risks and protecting insurance participants' legal rights and interests, these Measures are formulated in accordance with the Insurance Law of the People's Republic of China, the Interim Administrative Measures for the Use of Insurance Funds and relevant laws and regulations.
Article 2 These Measures are applicable to participation in financial derivatives trading by insurance group (controlling) companies, insurance companies and insurance assets management companies (hereinafter collectively referred to as insurance institutions) established within the territory of China in accordance with law.
Article 3 For the purpose of these Measures, financial derivatives (hereinafter referred to as derivatives) mean those financial contracts, values of which rely on one or more basic assets, indicators or special events, including forwards, futures, options and swaps.
For the purpose of these Measures, financial derivatives trading (hereinafter referred to as derivatives trading) refers to domestic derivatives trading excluding overseas derivatives trading.
Article 4 Insurance group (controlling) companies and insurance companies may participate in derivatives trading by themselves and also may entrust insurance assets management companies and other professional management institutions that satisfy the provisions of the China Insurance Regulatory Commission ("CIRC") in accordance with these Measures and relevant provisions to participate in derivatives trading within the authorized scope.
Article 5 Insurance institutions' participation in derivatives trading is limited to hedging or avoiding risks other than for speculation purposes, including:
1. Hedging or avoiding risks of existing assets, debts or corporate general risks; and
2. Hedging risks of proposed buy-in assets in the coming month or locking up their future trading prices.
Proposed buy-in assets referred to in Item 2 of this Article means assets, which the insurance institution has decided to buy in accordance with its investment decision-making procedures; and if it fails to buy in such assets within the month upon the decision-making date or gives up buy-in of such assets within the said time limit, it shall terminate, clear or close related derivatives within 5 days upon expiry of the specified time limit or the date, on which giving-up of the buy-in is decided.
Article 6 CIRC will promulgate provisions upon trading of specific derivatives in an appropriate time based on market development and actual needs.
Chapter II Qualification Conditions
Article 7 When participating in derivatives trading by themselves, insurance group (controlling) companies and insurance companies shall meet the following requirements:
1.
......
Bao Jian Fa [2012] No. 94
October 12, 2012
All insurance group (controlling) companies, insurance companies and insurance assets management companies,
For the purpose of regulating participation of insurance funds in financial derivatives trading, preventing capital operational risks and protecting insurance participants' legal rights and interests, the China Insurance Regulatory Commission formulates the Interim Measures for the Participation of Insurance Funds in Financial Derivatives Trading, and hereby prints and distributes to you for your compliance and implementation.
Interim Measures for the Participation of Insurance Funds in Financial Derivatives Trading
Chapter I General Provisions
Article 1 For the purpose of regulating participation of insurance funds in financial derivatives trading, preventing capital operation risks and protecting insurance participants' legal rights and interests, these Measures are formulated in accordance with the Insurance Law of the People's Republic of China, the Interim Administrative Measures for the Use of Insurance Funds and relevant laws and regulations.
Article 2 These Measures are applicable to participation in financial derivatives trading by insurance group (controlling) companies, insurance companies and insurance assets management companies (hereinafter collectively referred to as insurance institutions) established within the territory of China in accordance with law.
Article 3 For the purpose of these Measures, financial derivatives (hereinafter referred to as derivatives) mean those financial contracts, values of which rely on one or more basic assets, indicators or special events, including forwards, futures, options and swaps.
For the purpose of these Measures, financial derivatives trading (hereinafter referred to as derivatives trading) refers to domestic derivatives trading excluding overseas derivatives trading.
Article 4 Insurance group (controlling) companies and insurance companies may participate in derivatives trading by themselves and also may entrust insurance assets management companies and other professional management institutions that satisfy the provisions of the China Insurance Regulatory Commission ("CIRC") in accordance with these Measures and relevant provisions to participate in derivatives trading within the authorized scope.
Article 5 Insurance institutions' participation in derivatives trading is limited to hedging or avoiding risks other than for speculation purposes, including:
1. Hedging or avoiding risks of existing assets, debts or corporate general risks; and
2. Hedging risks of proposed buy-in assets in the coming month or locking up their future trading prices.
Proposed buy-in assets referred to in Item 2 of this Article means assets, which the insurance institution has decided to buy in accordance with its investment decision-making procedures; and if it fails to buy in such assets within the month upon the decision-making date or gives up buy-in of such assets within the said time limit, it shall terminate, clear or close related derivatives within 5 days upon expiry of the specified time limit or the date, on which giving-up of the buy-in is decided.
Article 6 CIRC will promulgate provisions upon trading of specific derivatives in an appropriate time based on market development and actual needs.
Chapter II Qualification Conditions
Article 7 When participating in derivatives trading by themselves, insurance group (controlling) companies and insurance companies shall meet the following requirements:
1.
......