China Banking Regulatory Commission, Measures for the Administration of Lease Financing Companies
中国银行业监督管理委员会金融租赁公司管理办法
July 02, 2007 | BY
clpstaff &clp articles &New measures to open up the lease financing sector to foreign investment
Promulgated: January 23 2007
Effective: March 1 2007
Applicability: For the purposes of these Measures, the term "lease financing company" means a non-bank financial institution approved by the China Banking Regulatory Commission that principally engages in the lease financing business (Article 2).
Main Contents: The major investor in a lease financing company shall satisfy one of the conditions set forth below:
(1) being a commercial bank with independent legal personality that is registered in China or abroad, and that satisfies the following conditions:
(i) having a capital adequacy ratio that satisfies the requirements of the financial regulator of the place where it is registered and that is not less than 8%;
(ii) having assets of not less than Rmb80 billion or the equivalent in a freely convertible currency as at the end of the most recent year;
(iii) having been profitable for the two most recent years in succession;
(iv) complying with the laws and regulations of the place where it is registered, and not having been involved in a major case or committed a major violation of laws or regulations during the most recent two years;
(v) having a good corporate governance structure, internal control mechanisms and a sound risk management system; and
(vi) other prudential conditions as specified by the China Banking Regulatory Commission;
(2) being a lease company registered in China or abroad, and satisfying the following conditions:
(i) having assets of not less than Rmb10 billion or the equivalent in a freely convertible currency as at the end of the most recent year;
(ii) having been profitable for the two most recent years in succession; and
(iii) complying with the laws and regulations of the place where it is registered, and not having been involved in a major case or committed a major violation of laws or regulations during the most recent two years;
(3) being a large enterprise registered in China whose core business is the manufacture of products suitable for lease financing transactions, and satisfying the following conditions:
(i) having an operating revenue of not less than Rmb5 billion or the equivalent in a freely convertible currency in the most recent year;
(ii) having been profitable for the two most recent years in succession;
(iii) having a net asset ratio of not less than 30% as at the
end of the most recent year;(iv) sales revenue from its core business accounting for at least 80% of its entire operating revenue;
(v) having a good credit record; and
(vi) complying with the laws and regulations of the place where it is registered, and not having been involved in a major case or committed a major violation of laws or regulations during the most recent two years; or
(4) being another financial institution recognized by the China Banking Regulatory Commission as being eligible to serve as major investor.
Related Legislation: PRC Banking Regulation Law, Dec 27 2004 No.1 p.45; and PRC Company Law (Amended), Oct 27 2005, CLP 2005 No.10 p.21
Full Analysis & Translation: See page 61
clp reference:3610/07.01.23prc reference:银监会令 [2007] 第1号promulgated:2007-01-23effective:2007-03-01This premium content is reserved for
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