National Development and Reform Commission, Circular on Matters Relevant to the Issuance of Renminbi-denominated Bonds in the Hong Kong Special Administrative Region by Entities in China that Are Not Financial Institutions

国家发展改革委员会关于境内非金融机构赴香港特别行政区发行人民币债券有关事项的通知

May 31, 2012 | BY

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Mainland Chinese enterprises allowed to issue renminbi bonds in Hong Kong.

Clp Reference: 3700/12.05.02 Promulgated: 2012-05-02 Effective: 2012-05-02

Issued: May 2 2012
Effective: as of date of issuance

Applicability: For the purposes of this Circular, the term “entity in China that is not a financial institution” means a non-bank entity with legal personality registered in the People's Republic of China.

For the purposes of this Circular, the term “renminbi-denominated bond” means a negotiable security issued in accordance with the law in the Hong Kong Special Administrative Region by an entity in China that is not a financial institution, that is denominated in renminbi, that has a term of at least one year, and of which the principal is to be repaid and interest on which is to be paid as specified (Article 1).

The issuance of renminbi-denominated bonds abroad by entities in China that are not financial institutions in countries or regions other than the Hong Kong Special Administrative Region shall be handled with reference to this Circular (Article 12).

Main contents: An enterprise directly under the central government may submit an application directly to the National Development and Reform Commission; a local enterprise shall submit its application to the provincial-level development and reform commission of the place where it is located, which shall then forward it to the National Development and Reform Commission after review (Article 2).

An entity in China that is not a financial institution that wishes to issue renminbi-denominated bonds in the Hong Kong Special Administrative Region shall satisfy the following conditions:

(1) having a good corporate governance mechanism;

(2) having a good credit rating;

(3) having a relatively strong profitability potential;

(4) the orientation of the proceeds mainly being used for a fixed asset investment project and complying with state macroeconomic control policy, industrial policy, policies on the use of foreign investment and on overseas investment, and provisions for the administration of fixed asset investment, and all the relevant formalities being in order;

(5) all outstanding enterprise bonds or other debts not being in default or in delay of payment of principal and/or interest; and

(6) not having committed a major violation of laws or regulations during the most recent three years.

Related legislation: Tentative Measures for the Administration of the Issuance of Renminbi Bonds in the Hong Kong Special Administrative Region by Domestic Financial Institutions, Jun 8 2007, CLP 2007 No.5 p.12

clp reference:3700/12.05.02promulgated:2012-05-02effective:2012-05-02

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