To further satisfy individuals' currency exchange demand for cross-border transactions, the State Administration of Foreign Exchange (SAFE) recently released the Circular of the State Administration of Foreign Exchange on Printing and Distributing the Regulations on Management of Currency Exchange Agencies and Self-service Currency Exchange Machines (Huifa No. 11 [2016], "Regulations") to improve management of currency exchange agencies and self-service currency exchange machines.

The Regulations is in line with the reform ideas of further streamlining administration and delegating powers and optimizing currency exchange services. The highlights are as follows: first, administration streamlining and power delegation will be promoted. Ex-ante market access management will be canceled, with no ex-ante access approval required from foreign exchange authorities for currency exchange agencies and self-service foreign exchange machines to provide currency exchange services. Second, the ways of regulation will be changed. Banks will be required to push forward and incorporate management of currency exchange agencies and self-service foreign exchange machines into their internal management, engage in the currency exchange business prudentially and in compliance with regulations and foreign exchange authorities will focus on enhancing ex-post and internal control inspections of banks. Third, business scope is defined. Currency exchange agencies and self-service currency exchange machines are positioned as the extension of banks' teller business to enhance the service capability and diversify channels to facilitate individual currency exchange. Fourth, business management will be improved to guard against money laundering risk. It is stressed that individuals should exchange foreign currency banknotes for RMB banknotes with currency exchange agencies and self-service currency exchange machines within the limit, which will not affect the annual limit of USD 50,000 or the equivalent on foreign exchange settlement for individuals. Fifth, regulations integration will be pressed ahead with. Three regulations on foreign exchange administration for currency exchange are integrated and abolished to facilitate understanding and implementation of foreign exchange administration policies by market players.