State Administration of Foreign Exchange, Circular on Abolishing and Revising the Examination and Approval Authority and Administrative Measures for Certain Foreign Exchange Transactions on the Capital Account

Issued: May 23 2011
Effective: June 1 2011

Main contents: The Circular abolishes the approval requirement of registration of deferred payment and the approval requirement of refund of advance payment for goods in foreign currency under the administration of trade credit registration; and the record filing of transfer of foreign exchange funds derived from the reduction of holding of state-owned shares in listed companies to the national social security fund (Articles 1-3). The examination and approval authority for determining the limits for certain financing-type security provided to foreign parties shall be delegated from the State Administration of Foreign Exchange to foreign exchange control branches and offices (Article 4). The fundamental ratio of advance payment of goods for trade credit shall be raised from 30% to 50% (Article 5).

Related legislation: PRC Administrative Permission Law, Aug 27 2003; and PRC Regulations for the Control of Foreign Exchange (2nd Revision), Aug 5 2008, CLP 2008 No.8 p.77