Notice on Further Optimizing Cross-border Renminbi Policies to Support the Stabilization of Foreign Trade and Foreign Investment Released
ISSUING AUTHORITIES:
People’s Bank of China
National Development and Reform Commission
Ministry of Commerce
State-owned Assets Supervision and Administration Commission of the State Council
State Administration of Foreign Exchange
DATE OF ISSUANCE:
December 31, 2020
EFFECTIVE DATE:
February 4, 2021
On December 31, 2020, People’s Bank of China, along with other authorities, promulgated the Notice on Further Optimizing Cross-border Renminbi Policies to Support the Stabilization of Foreign Trade and Foreign Investment (“Notice”), which takes effect on February 4, 2021. The Notice mainly puts forward a series of measures with a view to facilitating cross-border renminbi settlement for both enterprises and individuals.
For enterprises, the Notice proposes to promote a higher level of RMB settlement facilitation for trade and investment, including carrying out a pilot program for a higher level of trade and investment facilitation nationwide, supporting cross-border RMB settlement for new forms of trade such as cross-border e-commerce, market procurement trade mode and foreign trade integrated services, etc., and promptly adjusting the requirements for business handling and review in accordance with the commercial system reform.
Further, the Notice states that the cross-border RMB settlement process will be simplified. The measures adopted in this respect include optimizing the formation mechanism for the list of cross-border RMB businesses subject to special regulation, supporting electronic review of documents and carrying out a pilot program to facilitate the cross-border RMB settlement business for high-quality enterprises in the category of contracted projects nationwide. Most importantly, the domestic member enterprises designated by a multinational corporation group as the enterprise responsible for carrying out cross-border RMB business may, in light of their actual needs, open RMB settlement accounts at different places to process the centralized cross-border RMB receipt and payment under the current account.
Moreover, the Notice also aims to optimize the administration of cross-border RMB investment and financing by taking measures of relaxing the restrictions on the use of RMB income under certain capital accounts, facilitating reinvestment in China by foreign-invested enterprises, canceling the relevant special account management requirements for foreign direct investment, optimizing the administration of overseas RMB borrowings of domestic enterprises and simplifying the administration of overseas RMB loans of domestic enterprises.
In terms of facilitating individual’s cross-border RMB settlement, the actions mainly include further developing cross-border RMB settlement under current accounts of individuals and facilitating individuals to receive remittances under the same names from Hong Kong and Macao through their RMB bank settlement accounts. In addition, the Notice also provides to facilitate the use of RMB bank settlement accounts by overseas institutions by means of facilitating overseas institutions to receive overseas funds through their RMB bank settlement accounts.
Reference:
