China Insurance Regulatory Commission, Guidelines for the Establishment of Infrastructure Bond Investment Plan Products

中国保险监督管理委员会基础设施债权投资计划产品设立指引

December 08, 2009 | BY

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More stringent requirements for insurance asset management companies establishing infrastructure bond investment plan products.

Clp Reference: 3910/09.03.19 Promulgated: 2009-03-19 Effective: 2009-03-19

Issued: March 19 2009
Effective: as of date of issuance
Interpreting authority: China Insurance Regulatory Commission

Main contents: Professional management firms such as insurance asset management companies and trust companies are required to establish a dedicated subsidiary or division for the bond investment plan business (Article 4).

The debt repayment entity of a bond investment plan shall be a company that is listed on a main board in China or overseas, the de facto controller of a listed company or a large enterprise (group) under the central government (Article 8).

The Guidelines also set forth the credit enhancement methods, for example, for A-type enhancement method, a dedicated state fund or an unconditional and irrevocable joint and several liability guarantee for the entire amount of the principal and interest provided by a bank (Article 10).

The balance of investments in a single debt repayment entity shall, in general, not exceed Rmb3 billion, and shall not exceed 40% of the total investment in a single project (Article 11).

Related legislation: Trial Measures for the Administration of the Indirect Investment of Insurance Funds in Infrastructure Projects , Mar 14 2006, CLP 2006 No.5 p.18; and Guidelines for the Administration of the Indirect Investment of Insurance Funds in Infrastructure Bond Investment Plans (Trial Implementation)

clp reference:3910/09.03.19prc reference:保监发 〔2009〕 41号promulgated:2009-03-19effective:2009-03-19

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