Legislation roundup: Reinsurance transactions, lease financing and working with customs

Insurance

China Insurance Regulatory Commission, Circular on Issues Relevant to the Engagement in Reinsurance Transactions of Foreign-funded Insurance Companies with Their Affiliated Enterprise
中国保险监督管理委员会关于外资保险公司与其关联企业从事再保险交易有关问题的通知

To engage in reinsurance transactions with its affiliated enterprise, a foreign-funded insurance company will need to secure approval from the China Insurance Regulatory Commission. Also, the affiliated enterprise is required to achieve a net profit after the most recent three financial years and a most recent financial rating of at least A- or A3.

See the digest for more details.

Further reading
PRC Regulations for the Administration of Foreign-funded Insurance Companies (Revised)
Provisions for the Administration of the Reinsurance Business


Financing

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

The new Measures abolish the provision requiring the capital contribution of the major investor to account for at least 50% of the registered capital. The Measures specify that, among the promoters, at least one is to be a qualified commercial bank, manufacturer or foreign lease financing company and its capital contribution is to account for not less than 30% of the share capital. A qualified lease financing company may offer financial bonds, engage in asset securitisation and establish project companies in bonded zones in China.


Further reading
Measures for the Administration of Lease Financing Companies
Finance Leasing with Chinese Characteristics


Processing trade

General Administration of Customs, PRC Customs Measures for the Surveillance of Processing Trade Goods
海关总署中华人民共和国海关加工贸易货物监管办法

A business operator that needs to outsource its processing work is required to carry out record filing procedures with customs within three working days from the date of outsourcing. If the outsourced processing work involves more than one customs zone, or the processed goods are not returned and directly exported, it is not necessary, under the new Measures, to provide to customs a deposit or guarantee equal to the taxes and duties payable on the processed goods.

See the digest for more details.

Further reading
PRC Customs Measures for the Supervision of Processing Trade Goods (Revised)
PRC Customs Measures for the Supervision of Processing Trade Goods (2nd Revision)