Announcement on the Participation in Sovereign Bond Futures Trading on the China Financial Futures Exchange by Commercial Banks and Insurance Institutions

(Issued by the China Securities Regulatory Commission, the Ministry of Finance, the People's Bank of China and the China Banking and Insurance Regulatory Commission on February 14, 2020.)

CSRC Announcement [2020] No.12

With a view to further improving the structure of market entities and following the approval of the State Council, we hereby announce matters relating to the participation in the trading of sovereign bond futures on the China Financial Futures Exchange by commercial banks and insurance institutions as follows:

1 .   Qualified commercial banks may participate in sovereign bond futures trading on the China Financial Futures Exchange on a trial basis for risk management purposes.

2 .   Insurance institutions with investment management capabilities may participate in sovereign bond futures trading on the China Financial Futures Exchange for risk management purposes.

3 .   A commercial bank or insurance institution shall compliantly participate in sovereign bond futures trading in accordance with the law provided that risks are controllable and business is sustainable.

4 .   A commercial bank or insurance institution that participates in sovereign bond futures trading shall establish sound and comprehensive risk management and internal control systems and a business processing system, have a professional management team and compliant business operational procedures, and guard against and control trading risks.

5 .   The China Securities Regulatory Commission, Ministry of Finance, People's Bank of China and China Banking and Insurance Regulatory Commission shall leverage the functions of the cross ministerial level authority coordinating mechanism, strengthen regulatory cooperation and information sharing, push forward the participation of commercial banks and insurance institutions in sovereign bond futures trading on a batch by batch basis and promote the healthy development of the sovereign bond futures market.

6 .   In the event of a discrepancy between this Announcement and relevant provisions on the participation in sovereign bond futures trading by commercial banks and insurance institutions previously issued by the China Securities Regulatory Commission, Ministry of Finance, People's Bank of China or China Banking and Insurance Regulatory Commission, this Announcement shall prevail.