Measures for the Administration of the Over-the-Counter Trading Services for the National Interbank Bond Market
Measures for the Administration of the Over-the-Counter Trading Services for the National Interbank Bond Market
Measures for the Administration of the Over-the-Counter Trading Services for the National Interbank Bond Market
Announcement of the People's Bank of China [2016] No. 2
February 14, 2016
For the purposes of promoting the development of the bond market and increasing the proportion of direct financing, the People's Bank of China has developed the Measures for the Administration of the Over-the-Counter Trading Services for the National Interbank Bond Market, which are hereby issued and shall come into force on the date of issuance.
Measures for the Administration of the Over-the-Counter Trading Services for the National Interbank Bond Market
Chapter I General Provisions
Article 1 For the purposes of promoting the development of the bond market and increasing the proportion of direct financing, these Measures are developed in accordance with the Law of the People's Republic of China on the People's Bank of China and the Measures for the Administration of the Registration, Custody and Clearing of Bonds on the Interbank Bond Market (Order No. 1 [2009], PBC).
Article 2 For the purposes of these Measures, “over-the-counter trading services for the national interbank bond market” (hereinafter referred to as “OTC services”) means that financial institutions provide services for the opening of bond accounts of investors, distribution of bonds, and trading in bonds, as well as the corresponding bond custody, settlement, pledge registration, redemption agency, inquiry, and other services, through their service outlets or electronic channels, among others.
Article 3 Financial institutions launching OTC services shall adhere to the principle of good faith, sufficiently disclose risks, and protect investors' lawful rights and interests, shall not use any information not disclosed to the public to seek illicit benefits, and shall not collude with any issuer or investor to conduct tunneling or commit any other violation of laws and regulations.
Chapter II Institutions Launching OTC Services
Article 4 To launch OTC services, a financial institution (hereinafter referred to as the “launching institution”) shall meet the following conditions:
(1) It is a market maker or settlement agent actively trading on the national interbank bond market.
(2) It has a safe and stable computer processing system for OTC services, which is connected to the National Interbank Funding Center and the bond registration, custody and clearing institution for the interbank bond market (hereinafter referred to as “bond registration, custody and clearing institution”).
(3) It has adequate and effective OTC service management rules, risk prevention mechanisms, investor suitability management rules, and accounting measures, among others.
(4) It has a business department specifically responsible for OTC services, with qualified full-time personnel.
(5) It has committed no serious violation of laws and regulations in the past three years.
Article 5 A financial institution meeting the prescribed conditions shall, within one month of launching OTC services, undergo recordation formalities with the People's Bank of China (PBC) by submitting the following materials:
(1) OTC service launching plan and system implementation plan.
(2) Information on the department responsible for OTC services and staffing.
(3) OTC service management rules, risk prevention mechanisms, investor suitability management rules, and accounting measures.
(4) System connection conformity certificates issued by the National Interbank Funding Center and the bond registration, custody and clearing institution.
(5) Other materials as required by the PBC.
Launching institutions shall disclose to the public their service outlets launching OTC services, at the counters of their service outlets or through electronic channels, among others.
Chapter III Bond Types and Instruments in OTC Services
Article 6 Instruments in OTC services include spot bond trading, pledge-type repos, buyout repos, and other instruments recognized by the PBC.
Bond types in OTC services include issued treasury bonds, local government bonds, China Development Bank bonds, and policy bank bonds as recognized by the issuers and bonds newly issued to investors including investors in OTC services.
Article 7 Launching institutions shall abide by the relevant provisions on the interbank bond market in providing OTC services to investors, and when engaging in bond repurchase and other instruments, both sides shall enter into relevant master agreements to agree on their rights and obligations .
Launching institutions shall ensure a sufficient amount of pledge in conducting pledge-style repos with investors, continuously monitor the value of the pledged bonds, and establish a risk control mechanism to prevent related risks.
Chapter IV Investor Suitability Management
Article 8 Launching institutions shall establish investor suitability management rules to assess investors' risk identification capability and risk tolerance and provide sales and trading services for suitable bond types to investors with the corresponding capabilities.
......
Announcement of the People's Bank of China [2016] No. 2
February 14, 2016
For the purposes of promoting the development of the bond market and increasing the proportion of direct financing, the People's Bank of China has developed the Measures for the Administration of the Over-the-Counter Trading Services for the National Interbank Bond Market, which are hereby issued and shall come into force on the date of issuance.
Measures for the Administration of the Over-the-Counter Trading Services for the National Interbank Bond Market
Chapter I General Provisions
Article 1 For the purposes of promoting the development of the bond market and increasing the proportion of direct financing, these Measures are developed in accordance with the Law of the People's Republic of China on the People's Bank of China and the Measures for the Administration of the Registration, Custody and Clearing of Bonds on the Interbank Bond Market (Order No. 1 [2009], PBC).
Article 2 For the purposes of these Measures, “over-the-counter trading services for the national interbank bond market” (hereinafter referred to as “OTC services”) means that financial institutions provide services for the opening of bond accounts of investors, distribution of bonds, and trading in bonds, as well as the corresponding bond custody, settlement, pledge registration, redemption agency, inquiry, and other services, through their service outlets or electronic channels, among others.
Article 3 Financial institutions launching OTC services shall adhere to the principle of good faith, sufficiently disclose risks, and protect investors' lawful rights and interests, shall not use any information not disclosed to the public to seek illicit benefits, and shall not collude with any issuer or investor to conduct tunneling or commit any other violation of laws and regulations.
Chapter II Institutions Launching OTC Services
Article 4 To launch OTC services, a financial institution (hereinafter referred to as the “launching institution”) shall meet the following conditions:
(1) It is a market maker or settlement agent actively trading on the national interbank bond market.
(2) It has a safe and stable computer processing system for OTC services, which is connected to the National Interbank Funding Center and the bond registration, custody and clearing institution for the interbank bond market (hereinafter referred to as “bond registration, custody and clearing institution”).
(3) It has adequate and effective OTC service management rules, risk prevention mechanisms, investor suitability management rules, and accounting measures, among others.
(4) It has a business department specifically responsible for OTC services, with qualified full-time personnel.
(5) It has committed no serious violation of laws and regulations in the past three years.
Article 5 A financial institution meeting the prescribed conditions shall, within one month of launching OTC services, undergo recordation formalities with the People's Bank of China (PBC) by submitting the following materials:
(1) OTC service launching plan and system implementation plan.
(2) Information on the department responsible for OTC services and staffing.
(3) OTC service management rules, risk prevention mechanisms, investor suitability management rules, and accounting measures.
(4) System connection conformity certificates issued by the National Interbank Funding Center and the bond registration, custody and clearing institution.
(5) Other materials as required by the PBC.
Launching institutions shall disclose to the public their service outlets launching OTC services, at the counters of their service outlets or through electronic channels, among others.
Chapter III Bond Types and Instruments in OTC Services
Article 6 Instruments in OTC services include spot bond trading, pledge-type repos, buyout repos, and other instruments recognized by the PBC.
Bond types in OTC services include issued treasury bonds, local government bonds, China Development Bank bonds, and policy bank bonds as recognized by the issuers and bonds newly issued to investors including investors in OTC services.
Article 7 Launching institutions shall abide by the relevant provisions on the interbank bond market in providing OTC services to investors, and when engaging in bond repurchase and other instruments, both sides shall enter into relevant master agreements to agree on their rights and obligations .
Launching institutions shall ensure a sufficient amount of pledge in conducting pledge-style repos with investors, continuously monitor the value of the pledged bonds, and establish a risk control mechanism to prevent related risks.
Chapter IV Investor Suitability Management
Article 8 Launching institutions shall establish investor suitability management rules to assess investors' risk identification capability and risk tolerance and provide sales and trading services for suitable bond types to investors with the corresponding capabilities.
......