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- Index number:
- 000014453-2011-01121
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- Dispatch date:
- 2011-05-27
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- Publish organization:
- State Administration of Foreign Exchange
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- Exchange Reference number：
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- Name：
- The SAFE Adjusts and Simplifies Some Capital Account Management Policy Measures
In order to further improve foreign exchange management of the capital account, simplify the procedures for administrative examination and approval, and promote the facilitation of trade and investment, the State Administration of Foreign Exchange (The SAFE) recently issued the Circular of the SAFE on Cancellation or Adjustments of Certain Approval Authorities and Administrative Measures for Foreign Exchange Business under the Capital Account (HuiFa No. 20 [2011], hereinafter referred to as the Circular). The Circular will come into effect as of June 1, 2011.
The Circular mainly stipulates the following: First, it cancels the registration and approval of overdue deferred payments in the management of trade-credit registration. Where an enterprise registers to withdraw deferred payments within 120 days (inclusive) upon the issuance of the import customs declaration by customs, it is unnecessary to undergo the overdue registration and approval formalities at the local foreign exchange authority. Second, the Circular cancels the examination and approval for the return of foreign exchange under advance payments in the management of trade-credit registration. When foreign exchange from the advance payments of an enterprise is returned, the enterprise can directly log into the Trade- Credit Registration Management System to go through the cancellation procedures, as well as to go through the formalities to enter the returned funds into the account in accordance with the relevant regulations on foreign exchange administration of the current account. Third, the designated foreign exchange banks can directly handle the procedures for when foreign exchange obtained through a reduction in state-owned shares in overseas listed companies is transferred to the national social security fund and put on file. Fourth, the branches and foreign exchange administrative departments of the SAFE are authorized to check and ratify the quota for the balance of external financing guarantees (excluding those explicitly stipulated to be ratified by the SAFE) for the designated foreign exchange banks registered within their jurisdictions in accordance with the current regulations on the administration of external guarantees. Fifth, the base ratio for advance payments of goods under trade credit is increased from 30 percent to 50 percent.
This policy adjustment will help enterprises reduce costs and enhance efficiency. While vigorously simplifying the ex-ante approval procedures, the SAFE will also increase efforts to conduct off-site inspections and to carry out ex-post supervision, constantly improving foreign exchange administration of the capital account and steadily advancing the convertibility of the RMB under the capital account.
