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State Administration of Foreign Exchange
Notice of the State Administration of Foreign Exchange on the Centralized Management of Turnover Positions of Foreign Exchange Settlement
and Sales Operations by Foreign-funded Banks within the Territory of China
Hui Fa [2005] No. 50
The branches and administrative departments of foreign exchange of the State Administration of Foreign Exchange in all provinces,
autonomous regions and municipalities directly under the Central Government and the municipal branches of the State Administration
of Foreign Exchange in Shenzhen, Dalian, Qingdao, Xiamen and Ningbo:
In order to further regulate the management of turnover positions of foreign exchange settlement and sales operations by foreign-funded
banks within the territory of China, and in accordance with the relevant provisions such as the Interim Measures for the Administration
of Foreign Exchange Settlement and Sales Operations by Designated Foreign Exchange Banks (Order No. 4 [2004] of the People’s Bank
of China), we hereby notify the relevant issues as follows:
1.
For a foreign-funded bank within the territory of China, including a solely-capital bank, a joint-equity bank and the branch of a
foreign bank, the parent bank of a foreign-funded bank or head office of foreign bank or the regional administrative headquarters
thereof may authorize a branch within the territory of China (hereinafter referred to as the authorized branch) to implement a centralized
balance of transactions and uniform management on turnover positions of foreign exchange settlement and sales over all the branches
and sub-branches within the territory of China.
2.
An authorized branch shall, when filing an application for the centralized management mode of business positions of foreign exchange
settlement and sales operations, submit the following materials:
(1)
The authority letter as granted by the parent bank thereof to approve the centralized management mode of business positions of foreign
exchange settlement and sales operations;
(2)
The approval document of the China Banking Regulatory Commission for the resident office of the foreign-funded financial institution
within the territory of China;
(3)
The explanation of the foreign-funded bank on the internal management system, accounting measures and technical support for the
centralized management of business positions of foreign exchange settlement and sales operations;
(4)
The seat certification of the authorized branch in China Foreign Exchange Trade Center; and
(5)
The certifications that the foreign exchange settlement and sales operations of all the branches and sub-branches of this foreign-funded
bank comply with the relevant regulations, which have been affixed with seals of the relevant local foreign exchange bureaus (including
such aspects as the management of positions of foreign exchange settlement and sales operations and the report of relevant statistical
data and etc.)
3.
The branch or the administrative department of foreign exchange of the State Administration of Foreign Exchange shall, within 20 workdays
as of receiving an application of the authorized branch of a foreign-funded bank for the centralized management mode of positions
of foreign exchange settlement and sales operations, carry out an examination thereon and shall report it to the State Administration
of Foreign Exchange for the qualification archival filing.
4.
An authorized branch shall submit the following materials when applying for the total turnover position of foreign exchange settlement
and sales operations:
(1)
An Application Form for the Total Turnover Position of Foreign Exchange Settlement and Sales Operations (see attachment);
(2)
The number of branches and sub-branches of this foreign bank in the inland of China; the working capital in RMB and foreign currencies
of all branches; the written certification document issued by the relevant foreign exchange bureau where a branch thereof is located
that the specific branch has obtained the qualification of foreign exchange settlement and sales operations; and
(3)
The data of foreign exchange settlement and sales operations of all branches and sub-branches of this foreign-funded bank for each
day in the first 6 months, including the daily average margin, a single maximum mount of foreign exchange settlement or sale, daily
maximum amount of foreign exchange settlement or sale, etc. (the aforesaid data of a branch or sub-branch in a different place shall
be affixed with the seal of the local branch or sub-branch of the State Administration of Foreign Exchange for confirmation).
5.
The branch or the administrative department of foreign exchange of the State Administration of Foreign Exchange shall, within 20 workdays
as of receiving an application of an authorized branch for the total turnover position of foreign exchange settlement and sales operations,
verify the total turnover position of foreign exchange settlement and sales operations of the relevant foreign-funded bank. The total
turnover position of foreign exchange settlement and sales operations by an authorized branch with the qualification of non-US dollar
market maker shall be reported to the State Administration of Foreign Exchange for verification. by the branch or the administrative
department of foreign exchange of the State Administration of Foreign Exchange where the authorized branch is located
6.
The measures for verifying the total turnover position of foreign exchange settlement and sales operations shall be implemented according
to the Detailed Rules for Implementing the Foreign Exchange Settlement, Sale and Payment Operations of Foreign-funded Banks (No.
202 [1996] of the People’s Bank of China). To be specific, a foreign-funded bank as authorized to open a special RMB account for
foreign exchange settlement and sale upon approval may sell less than 20% of the registered capital or working capital in foreign
exchange within the territory of China in the inter-bank foreign exchange trade market and purchase RMB currency into the special
RMB account for foreign exchange settlement and sale as turnover capital.
7.
For a foreign-funded bank that implements the centralized management mode of positions of foreign exchange settlement and sales operations,
the original positions of all the branches and sub-branches thereof within the territory of China shall be incorporated into the
management of the total turnover position of foreign exchange settlement and sales operations of the authorized branch. The authorized
branch shall distribute the total turnover position of foreign exchange settlement and sales operations as acquired among all branches
and sub-branches within the jurisdiction thereof and report the specific distribution and adjustment to the foreign exchange bureau
where the corresponding branch or sub-branch is located in a timely manner.
8.
An authorized branch shall, within the authorized scope, carry out the management of the daily position of foreign exchange settlement
and sales operations of other branches and sub-branches of this foreign-funded bank. Where the position of foreign exchange settlement
and sales operation of any other branch or sub-branch goes beyond the authorized scope, the authorized branch shall supervise and
urge the said branch or sub-branch to report it to the foreign exchange bureau where it is located for archival filing.
9.
The branch or the administrative department of foreign exchange of the State Administration of Foreign Exchange where an authorized
branch is located shall carry out daily verification to the total turnover position of foreign exchange settlement and sales operations
according to the electronic information of foreign exchange settlement and sales operations (including the transactions on behalf
of others or for oneself through the internal system or the China Foreign Exchange Trade Center in the previous workday) as reported
by banks in the previous day. All branches and administrative departments of foreign exchange of the State Administration of Foreign
Exchange shall, according to the relevant provisions of the Interim Measures for the Administration of Foreign Exchange Settlement
and Sales Operations by Designated Foreign Exchange Banks (No. 4 [2002] of the People’s Bank of China), carry out the management
on the total position of foreign exchange settlement and sales operations of the authorized branches of foreign-funded banks within
the jurisdiction thereof.
10.
The branch or the administrative department of foreign exchange of the State Administration of Foreign Exchange where an authorized
branch is located shall take charge of the administration of the daily total position as reported by the bank and give treatment
to any overstepping of authorization in a timely manner according to the relevant provisions. The branch or the administrative department
of foreign exchange shall, when verifying the total turnover position of foreign exchange settlement and sales operations, pay a
visit to the business site of the relevant authorized branch so as to inspect and check and accept the support circumstance of technical
system for the centralized management mode of business positions of foreign exchange settlement and sales operations on the spot.
11.
For any foreign-funded bank that hasn’t implemented the centralized management mode of positions of foreign exchange settlement and
sales operations, the turnover positions of foreign exchange settlement and sales operations thereof shall be managed and verified
according to the provisions in force.
12.
The present Notice shall come into force as of August 1, 2005.
All the branches and administrative departments of foreign exchange of the State Administration of Foreign Exchange shall, after receiving
the present Notice, forward it to sub-branches and foreign-funded banks of all centers within the jurisdiction. When encountering
any problem during implementation, if any, the relevant organ or bank shall contact the State Administration of Foreign Exchange
in a timely manner
Contact telephone numbers: 010-68402304 and 010-68402099.
Attachment: Application Form for the Total Turnover Position of Foreign Exchange Settlement and Sales Operations of Bank (omitted)
State Administration of Foreign Exchange
July 12,2005
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