Ministry of Labour and Social Security, China Banking Regulatory Commission, China Securities Regulatory Commission and China Insurance Regulatory Commission, Administration of Enterprise Pension Funds Trial Procedures

Promulgated: February 23 2004
Effective: May 1 2004
Applicability: The Procedures apply to trusteeship management, account management, custodianship and investment management of enterprise pension funds. "Enterprise pension funds" refers to enterprise supplementary old-age pension insurance funds formed by capital raised through enterprise pension plans formulated in accordance with the law and the proceeds from investment and operation thereof (Article 2). "Trustee" refers to the board of directors of enterprise pensions that are entrusted to manage enterprise pension funds, or legal person trustee organizations such as old-age pension management companies that comply with state provisions (Article 10). "Beneficiary" refers to enterprise employees who join the enterprise pension plan and enjoy the beneficiary rights (Article 14). "Account manager" refers to professional organizations that are entrusted by trustees to manage enterprise pension funds accounts (Article 19). "Custodian" refers to commercial banks or professional organizations that are entrusted by trustees to take custody of the property of enterprise pension funds (Article 25). "Investment manager" refers to professional organizations that are entrusted by trustees to invest and manage the property of enterprise pension funds (Article 33). "Intermediary services organizations" refers to professional organizations such as investment consultancies, credit evaluation companies, actuarial consultancies, law firms and accounting firms that provide services for the management of enterprise pensions (Article 41).
Where the State Council has other provisions on management of enterprise pension funds, such provisions shall prevail (Article 68).

Main contents: Part Two concerns trustees, and sets out the duties that shall be performed by trustees (Article 13) and the conditions under which the duties of legal person trustee organizations shall be terminated (Article 14). Article 12 also sets out the qualifications required of legal person trustee organizations, including registered capital of not less than Rmb100 million and net assets maintained at not less than Rmb150 million at any time.
Part Three concerns account managers, and sets out the duties that shall be performed by account managers (Article 21) and the conditions under which the duties of account managers shall be terminated (Article 22). Article 20 also sets out the qualifications required of account managers, including registered capital of not less than Rmb50 million.
Part Four concerns custodians, and sets out the duties to be performed by custodians (Article 27), the conditions under which the duties of custodians shall be terminated (Article 29) and acts of custodians that are prohibited (Article 32). Article 26 also sets out the qualifications required of custodians, including net assets of not less than Rmb5 billion.
Part Five concerns investment managers, and sets out the duties to be performed by investment managers (Article 35), the conditions under which the duties of investment managers shall be terminated (Article 37) and acts of investment managers that are prohibited (Article 40). Article 34 also sets out the qualifications required of investment managers, including registered capital of not less than Rmb1 billion and net assets maintained at not less than Rmb1 billion at any time for comprehensive type securities companies, and registered capital of not less than Rmb100 million, and net assets maintained at not less than Rmb100 million at any time for fund management companies, trust investment companies, insurance asset management companies or other professional investment institutions. Article 36 sets out the conditions under which investment managers shall immediately report to trustees and the relevant supervisory department, for example, when there are large fluctuations in the market value of the property of enterprise pension funds (Article 36).
Part Six sets out the businesses that may be engaged in by intermediary service organizations when they are entrusted to do so (Article 42).
Part Seven concerns investment of enterprise pension funds, and stipulates the proportion of net assets of the funds that may be invested in different types of investment tools (Article 47). Scope of investment for the property of enterprise pension funds is limited to bank deposits, treasury bonds and other financial products with high liquidity, including repurchase of short-term bonds, financial bonds and enterprise bonds with credit rating at or above investment grade, convertible bonds, insurance products with an investment nature, securities investment funds and stocks, etc. (Article 46).
Part Eight concerns proceeds distribution and fees, Part Nine information disclosure and Part Ten supervision and inspection.