Cctv newsOn December 8, the State Administration of Foreign Exchange issued the Notice on Further Deepening Reform and Promoting the Facilitation of Cross-border Trade and Investment.
In order to thoroughly implement the decision-making arrangements of the CPC Central Committee and the State Council, further promote the facilitation of cross-border trade and investment, and effectively enhance the ability of foreign exchange management to serve the real economy, the State Administration of Foreign Exchange has decided to further deepen the reform of foreign exchange management, facilitate market participants to handle cross-border trade and investment business in compliance, and promote high-quality development through high-level opening. The relevant matters are hereby notified as follows:
I. Promoting the facilitation of foreign exchange receipts and payments in trade.
(1) Optimize the foreign exchange management of market procurement trade. Under the market procurement trade, a market entity that entrusts a third party to declare and export foreign exchange in its own name shall meet the following conditions: 1. The market entity engaged in market procurement trade has been filed on the local government’s market procurement trade networking platform. The networking platform of market procurement and trade should be able to collect the whole process information of transaction and export, and provide detailed export data corresponding to enterprises and individual industrial and commercial households. 2. The handling bank adopts other necessary technical means, such as docking the system with the market procurement and trade networking platform or logging in through the webpage, to identify the customer’s identity, verify the authenticity of the transaction background, and prevent the repeated use of the transaction information.
(two) relax the processing trade balance net settlement. The bank shall meet the following conditions for the enterprise to handle the fund settlement of the deduction of foreign exchange receipt and payment for incoming materials, that is, the net settlement of the export payment and the imported material payment: 1. After the enterprise purchases the materials from the overseas counterparty and processes them, it will sell the finished products to the same overseas counterparty. 2. Before an enterprise carries out the business of deduction of foreign exchange receipts and payments for counterpart materials, it needs to present relevant materials to the bank for explanation, and the bank will add the logo of "enterprise for counterpart materials deduction" to the main body identification function of the foreign exchange monitoring system for goods trade. 3. The enterprise should arrange the netting period reasonably, and settle accounts receivable and payable in time. In principle, the netting shall be settled at least once every quarter.
Banks should review the authenticity and rationality of their business in accordance with the principle of exhibition industry, handle the deduction of foreign exchange receipts and payments for enterprises identified as "enterprises with corresponding deduction of incoming materials", and declare the actual receipt and payment data and reduction data as required (see Annex 1 for reporting requirements).
(3) Improve the receipt and payment of cross-border trade funds under entrustment. When the agent is really unable to handle the collection and payment of foreign exchange in the trade of goods due to bankruptcy, frozen bank account and other circumstances, the bank can handle the collection and payment of foreign exchange in the trade of goods carefully for the entrusting party according to the principle of exhibition industry after confirming the authenticity and rationality of the income and expenditure, and mark "non-declarer+entrusting party’s collection and payment of foreign exchange +XXX (agent’s name)" in the postscript of the foreign-related income and expenditure declaration transaction.
(4) Facilitating the settlement of foreign exchange funds for operating leasing business of domestic institutions. If a domestic institution (hereinafter referred to as the lessee) uses its own foreign exchange income to pay foreign currency rent for domestic operating leases (including aircraft, ships and large equipment) to a domestic leasing company (hereinafter referred to as the lessor), it shall meet the following conditions: 1. The lessee has a stable source of foreign exchange income and the foreign exchange income has a certain scale; The annual foreign currency rent paid by the lessee shall not be less than the equivalent of USD 100 million in principle, and the expenditure demand is reasonable; The lessee has been included in the high-quality enterprise that facilitates foreign exchange receipts and payments; 2. More than 50% of the lessor’s funds for purchasing the leased property come from foreign currency debt, or foreign currency rent is required for renting the leased property from abroad. In principle, the foreign currency rental income collected by the lessor shall not be used for settlement of foreign exchange (except for domestic tax payment and cancellation of liquidation), which can be used to pay overseas rent, repay foreign currency debts, pay the lease item abroad and other foreign exchange expenditures that meet the requirements of the foreign exchange bureau.
Banks should follow the principle of exhibition industry and handle the transfer of foreign currency rent for domestic business leasing after reviewing the authenticity and rationality of the business. The lessee shall fill in the operating lease contract number and mark the words "foreign currency rental payment" in the postscript column of the transaction such as the Application for Domestic Remittance; The lessor shall fill in the operating lease contract number in the transaction postscript column of the Domestic Income Declaration Form and mark the words "foreign currency rent collection".
Second, expand the capital account facilitation policy
(5) Pilot policies to promote cross-border financing facilitation nationwide. Incorporate technology-based SMEs into the pilot scope of cross-border financing facilitation, and further support the technological innovation of SMEs. High-tech, "specialized and innovative" and technology-based small and medium-sized enterprises in Tianjin, Shanghai, Jiangsu, Shandong (including Qingdao), Hubei, Guangdong (including Shenzhen), Sichuan, Shaanxi, Beijing, Chongqing, Zhejiang (including Ningbo), Anhui, Hunan and Hainan provinces (cities) can independently borrow foreign debts within the equivalent amount of 10 million US dollars. Qualified high-tech, "specialized and innovative" and technology-based small and medium-sized enterprises within the jurisdiction of other regions can borrow foreign debts independently within a limit of not more than the equivalent of 5 million US dollars (see Annex 2 for implementation details).
(6) Relax the scale restrictions on the upfront expenses of overseas direct investment (ODI). Cancel the restriction that the cumulative remittance of the upfront expenses of overseas direct investment by domestic enterprises should not exceed the equivalent of US$ 3 million, but the cumulative remittance should not exceed 15% of the total amount of Chinese investment.
(seven) to facilitate the payment and use of equity transfer funds under the domestic reinvestment of foreign-invested enterprises (FDI) and funds raised by overseas listing. Adjust the capital project asset realization account to the capital project settlement account (see Annex 3 for the relevant account integration scheme). Domestic equity transferor (including institutions and individuals) can directly remit the equity transfer consideration funds paid by domestic entities in foreign currency and the foreign exchange funds raised by domestic enterprises listed overseas to the capital account. The funds in the capital account settlement account can be independently used for foreign exchange settlement. The domestic equity transferor may directly transfer the equity transfer consideration funds paid by foreign-invested enterprises with RMB funds from foreign exchange settlement (from direct foreign exchange settlement income or RMB funds in accounts to be paid for foreign exchange settlement) to the RMB account of the domestic equity transferor.
Third, optimize the foreign exchange management of capital projects
(8) Improve the negative list management of capital account income use. Non-financial enterprises’ capital, foreign exchange income under foreign debts and RMB funds obtained from settlement of foreign exchange should follow the principle of truthfulness and self-use, and may not be directly or indirectly used for expenditures prohibited by national laws and regulations; Unless otherwise specified, it shall not be directly or indirectly used for securities investment or other investment and wealth management (except for wealth management products and structured deposits with risk rating not higher than Grade II); It shall not be used to issue loans to non-affiliated enterprises (except for the circumstances where the business scope is clearly permitted and the Lingang New Area of China (Shanghai) Pilot Free Trade Zone, Nansha New Area of Guangzhou of China (Guangdong) Pilot Free Trade Zone, Yangpu Economic Development Zone of China (Hainan) Free Trade Port and Beilun District of Ningbo City, Zhejiang Province); It shall not be used to purchase non-self-use residential real estate (except for enterprises engaged in real estate development and leasing).
(9) Cancel the approval for opening foreign debt accounts in different places. Non-financial enterprises with reasonable needs are allowed to open foreign debt accounts in banks other than the foreign exchange branches where they are registered.
Encourage banks to include more high-quality enterprises in the scope of capital account income payment facilitation; According to the actual needs of enterprises, further enrich cross-border investment and financing products and exchange rate risk management products, and optimize business processes; According to the principle of exhibition industry, do a good job of customer coordination, strengthen post-event monitoring by scientific and technological means, and provide more convenient and efficient cross-border fund settlement services for real and compliant cross-border investment and financing; If you find anything suspicious, report it in time. All branches shall strengthen post-event supervision, verification and inspection of the above-mentioned businesses, and guide banks and enterprises to conduct business in compliance.
This notice shall be implemented as of the date of promulgation (of which the seventh item shall be implemented as of June 3, 2024). If the previous provisions are inconsistent with this notice, this notice shall prevail. See Annex 4 for the specific amendments. The provincial (city) branches of the State Administration of Foreign Exchange shall, after receiving this notice, promptly forward it to the mainland (city) branches, city commercial banks, rural commercial banks, foreign-funded banks and rural cooperative banks under their jurisdiction.