State Administration of Foreign Exchange, Provisions on Foreign Exchange Control in Connection with Overseas Securities Investments by Qualified Domestic Institutional Investors

国家外汇管理局合格境内机构投资者境外证券投资外汇管理规定

September 10, 2013 | BY

clpstaff &clp articles &

Forex control relaxed for QDII securities investments.

Clp Reference: 3820/13.08.21 Promulgated: 2013-08-21 Effective: 2013-08-21

Promulgated: August 21 2013

Effective: as of date of promulgation

Applicability: For the purposes of these Provisions, the term “qualified investor” means a domestic institution that has secured the approval or permission of the relevant department to engage in overseas securities and other such investment (Overseas Investment), and includes but is not limited to commercial banks, securities companies, fund management companies, insurance institutions and trust companies (Article 2).

Main contents: The Provisions remove the restriction on the types of currencies that a qualified investor may outwardly or inwardly remit (Article 6). The sources of funds for Overseas Investments of qualified investors are also expanded. A qualified investor may invest its own funds or funds collected from domestic institutions and individuals in foreign markets, and products permitted by regulations and relevant authorities (application of own funds overseas by banks excepted) (Article 2). The State Administration of Foreign Exchange (SAFE) also removes the requirement to review foreign exchange conversion and purchase and reduces the materials required for an investment limit application (Article 5).

SAFE shall effect balance control in respect of investment limits where the net amount remitted abroad for Overseas Investment by a qualified investor (including foreign exchange and renminbi funds) may not exceed its approved investment limit (Article 6).

Related legislation: Trial Measures for the Administration of Overseas Securities Investment by Qualified Domestic Institutional Investors, Jun 18 2007, CLP 2007 No.7 p.38; and PRC Regulations for the Control of Foreign Exchange (2nd Revision), Oct 5 2008, CLP 2008 No.8 p.77

Repealed legislation: Operational Rules for Foreign Exchange Control in Connection with Overseas Financial Management Services on Behalf of Customers of Commercial Banks, 2006; and Circular on Issues Relevant to Foreign Exchange Control in Connection with Overseas Securities Investments of Fund Management Companies and Securities Companies, 2009

clp reference:3820/13.08.21promulgated:2013-08-21effective:2013-08-21

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