People's Bank of China, Large and Suspicious Renminbi Payment Transactions Reporting Administrative Measures

Promulgated: January 3 2003
Effective: March 1 2003
Applicability: The Measures apply to transactions of money payments and funds settlement denominated in renminbi (including those made by negotiable instruments, bank cards, internet payments or cash) conducted in the course of economic activities by work units or individuals (Article 2). The Measures apply to, among others, policy banks and commercial banks when handling payment transactions (Article 3).

Main contents: The Measures strengthen supervision of renminbi payment transactions and standardize the reporting Measures thereof in the aim of preventing the payment and settlement facilities of financial institutions from being used to launder funds (Article 1). Financial institutions shall integrate anti-money laundering mechanisms into their organization, and appoint (an) employee(s) who will be responsible for recording, analyzing and reporting large and suspicious transactions (Article 6). Large transactions include: a single transfer of Rmb1 million or more between the accounts of legal persons, other organizations or individually-owned household businesses; a single cash transaction of Rmb200,000 or more (including deposits, withdrawals, cash transfers, money orders and cashier's cheques), and; transfers of Rmb200,000 or more between two accounts of an individual or an organization (Article 7). The Measures also list a wide range of financial activities that shall be considered suspicious, including: transactions in a frequency or of an amount that obviously do not accord with the account holder's scope of business, and; a noticeable increase in transactions with bank accounts in regions where drug trafficking, smuggling and terrorism are frequent (Article 8). Financial institutions shall establish a client database for recording pertinent data, including registered capital, scope of business, principle senders and recipients of funds, and daily average account transaction amounts (Article 10). Financial institutions should report large or suspicious transactions to the People's Bank of China or its branches (Article 16). When the financial institution discovers a transaction that is clearly related to illegal activity, it should immediately notify public security authorities (Article 18).
Related legislation: PRC People's Bank of China Law, Mar 18 1995, CLP 1995 No.5 p23