(Adopted at the 68th Executive Meeting of the State Council on February 19, 2003, promulgated by Decree No. 372 of the State Council
of the People s Republic of China on March 1, 2003, and effective as of September 1, 2003)
Chapter I General Provisions
Article 1 These Regulations are formulated in accordance with the Education Law of the People s Republic of China, the Vocational Education
Law of the People s Republic of China and the Law of the People s Republic of China on Promotion of Privately-Run Schools for the
purposes of standardizing Chinese-foreign cooperation in running schools, strengthening international exchange and cooperation in
the field of education and promoting the development of the educational cause.
Article 2 These Regulations apply to the activities of the cooperation between foreign educational institutions and Chinese educational institutions
(hereinafter referred to as Chinese and foreign cooperators in running schools) in establishing educational institutions (hereinafter
referred to as Chinese-foreign cooperatively-run schools) within the territory of China to provide education service mainly to Chinese
citizens.
Article 3 Chinese-foreign cooperation in running schools is an undertaking beneficial to public interests and forms a component of China s
educational cause.
For Chinese-foreign cooperation in running schools, the State adopts the policies of opening wider to the outside world, standardization
of running schools, exercising administration according to law and promoting its development.
The State encourages Chinese-foreign cooperation in running schools to which high-quality foreign educational resources are introduced.
The State encourages Chinese-foreign cooperation in running schools in the field of higher education and vocational education,
and encourages Chinese institutions of higher learning to cooperate with renowned foreign institutions of higher learning in running
schools.
Article 4 The legal rights and interests of Chinese and foreign cooperators in running schools and of Chinese-foreign cooperatively-run schools
shall be protected by the laws of China.
Chinese-foreign cooperatively-run schools shall enjoy preferential policies made by the State and enjoy autonomy when conducting
educational activities in accordance with law.
Article 5 Chinese-foreign cooperation in running schools shall abide by the laws of China, implement China s educational policies, comply
with Chinese public ethics and shall not jeopardize China s sovereignty, security and public interests.
Chinese-foreign cooperation in running schools shall meet the needs of the development of China s educational cause, ensure teaching
quality and make efforts to train all kinds of talents for China s socialist construction.
Article 6 Chinese and foreign cooperators in running schools may cooperate to establish educational institutions of various types at various
levels. However, they shall not establish institutions offering compulsory education service or special education services such as
military, police and political education services.
Article 7 No foreign religious organization, religious institution, religious college and university or religious worker may engage in cooperative
activities of running schools within the territory of China.
Chinese-foreign cooperatively-run schools shall not offer religious education, nor conduct religious activities.
Article 8 The education administrative department of the State Council shall be responsible for overall planning, comprehensive coordination
and macro control for all Chinese-foreign cooperative activities in running schools nationwide. The education administrative department,
the labour administrative department and other relevant administrative departments of the State Council shall be responsible for
the work in relation to Chinese-foreign cooperation in running schools in accordance with their functions and duties as defined by
the State Council.
The education administrative departments of the people s governments of the provinces, autonomous regions and municipalities
directly under the Central Government shall be responsible for overall planning, comprehensive coordination and macro control for
all Chinese-foreign cooperative activities in running schools within their respective administrative regions. The education administrative
departments, the labour administrative departments and other relevant administrative departments of the people s governments of
the provinces, autonomous regions and municipalities directly under the Central Government shall be responsible for the work in relation
to Chinese-foreign cooperation in running schools within their respective administrative regions in accordance with their functions
and duties.
Chapter II Establishment
Article 9 An educational institution which applies for establishing a Chinese-foreign cooperatively-run school shall have the legal person
status.
Article 10 A Chinese or foreign cooperator in running a school may contribute with funds, in kind or in forms of land-use right, intellectual
property rights or other assets to establish the school.
Contribution of intellectual property rights by a Chinese or foreign cooperator in running a school shall not exceed one-third
of its total contribution. However, for a foreign educational institution that comes to China for cooperation in running a school
at the invitation of the education administrative department or the labour administrative department of the State Council or at the
invitation of the people s government of a province, an autonomous region or a municipality directly under the Central Government,
its contribution in the form of intellectual property rights may exceed one-third of its total contribution.
Article 11 A Chinese-foreign cooperatively-run school shall meet the basic requirements prescribed by the Education Law of the People s Republic
of China, the Vocational Education Law of the People s Republic of China, the Higher Education Law of the People s Republic of
China and other laws and administrative regulations, and shall have the legal person status. However, a Chinese-foreign cooperatively-run
school established to offer higher education service through the cooperation between a foreign educational institution and a Chinese
institution of higher learning which offers education for academic qualifications may have no legal person status.
The establishment of a Chinese-foreign cooperatively-run school shall follow the standards for the establishment of State-run educational
institutions of the same type and at the same level.
Article 12 An application for establishing a Chinese-foreign cooperatively-run school offering higher education for academic qualifications
at or above the regular university education shall be subject to examination and approval of the education administrative department
of the State Council; an application for establishing a Chinese-foreign cooperatively-run school offering specialized higher education
or higher education for non-academic qualifications shall be subject to examination and approval of the people s government of the
province, autonomous region or municipality directly under the Central Government where the proposed school is to be located.
An application for establishing a Chinese-foreign cooperatively-run school offering secondary education for academic qualifications,
programs of tutoring self-taught students for examinations, programs offering supplementary teaching of school courses and pre-school
education shall be subject to examination and approval of the education administrative department of the people s government of
the province, autonomous region or municipality directly under the Central Government where the proposed school is to be located.
An application for establishing a Chinese-foreign cooperatively-run school offering vocational technical training shall be subject
to examination and approval of the labour administrative department of the people s government of the province, autonomous region
or municipality directly under the Central Government where the proposed school is to be located.
Article 13 The establishment of a Chinese-foreign cooperatively-run school shall include two steps of preparation for establishment and formal
establishment. However, the applicant may file an application directly for formal establishment if it fulfills the conditions for
offering education and meets the standards for establishment.
Article 14 An applicant who applies for preparation for establishment of a Chinese-foreign cooperatively-run school shall submit the following
documents:
(1) a project report which shall mainly contain the names of the Chinese and foreign cooperators in running the school, the name
of the proposed cooperatively-run school, educational targets, size of the school, level and form of education to be offered, conditions
for offering education, system of internal management, sources of funding and capital management and use, etc.;
(2) a cooperative agreement which shall contain the duration of cooperation and ways of dispute settlement, etc.;
(3) valid documents verifying sources of assets and amount of capital, with clear statement of ownership;
(4) a donation agreement for any assets provided as a donation to the proposed school, which carries the name of the donor, value
of donation, purpose of use and management methods, and the relevant valid verifying documents; and
(5) a certificate verifying that not less than 15 percent of initial funds provided by the Chinese and foreign cooperators is
already invested.
Article 15 In the case of an application for preparation for establishment of a Chinese-foreign cooperatively-run school, the examination and
approval authorities shall decide whether to grant the approval or not within 45 days from the date of receiving the application.
If the application is approved, a letter of approval for preparation for establishment shall be issued; if the application is not
approved, reasons shall be provided in writing.
Article 16 An applicant whose application for preparation for establishment of a Chinese-foreign cooperatively-run school is approved shall
file an application for formal establishment within three years from the date of approval; if it is more than three years, the Chinese
and foreign cooperators in running the school shall file an application anew.
During the period of preparation for establishment, no students shall be enrolled.
Article 17 An applicant who has completed its preparation for establishment and applies for formal establishment shall submit the following
documents:
(1) an application for formal establishment;
(2) the letter of approval for preparation for establishment;
(3) a report on the progress of preparation for establishment;
(4) the articles of association for the Chinese-foreign cooperatively-run school, and a list of members on its first board of
trustees or board of directors, or of its first joint managerial committee;
(5) valid documents verifying assets of the Chinese-foreign cooperatively-run school; and
(6) documents verifying the qualifications of the president or principal administrator, the teachers and financial staff.
An applicant who directly applies for formal establishment of a Chinese-foreign cooperatively-run school shall submit all documents
listed under subparagraphs (1), (4), (5) and (6) of the preceding paragraph and subparagraphs (2), (3) and (4) of Article 14.
Article 18 In the case of an application for formal establishment of a Chinese-foreign cooperatively-run school offering education for non-academic
qualifications, the examination and approval authorities shall decide whether to grant the approval or not within three months from
the date of receiving the application; in the case of an application for formal establishment of a Chinese-foreign cooperatively-run
school offering education for academic qualifications, the examination and approval authorities shall decide whether to grant the
approval or not within six months from the date of receiving the application. If the application is approved, a permit for Chinese-foreign
cooperation in running the school printed in a standard format and numbered in a unified way shall be granted; if the application
is not approved, reasons shall be provided in writing.
The format of the permit for Chinese-foreign cooperation in running a school shall be determined by the education administrative
department of the State Council and the printing be arranged separately by the education administrative department and the labour
administrative department of the State Council in accordance with their respective functions and duties; the permit for Chinese-foreign
cooperation in running a school shall be numbered in a unified way by the education administrative department of the State Council
and the specific measures shall be formulated by the education administrative department jointly with the labour administrative department
of the State Council.
Article 19 In the case of an application for formal establishment of a Chinese-foreign cooperatively-run school offering education for academic
qualifications, the examination and approval authorities, upon receiving such an application, shall organize an expert committee
to make an evaluation, and the expert committee shall give its opinions.
Article 20 A Chinese-foreign cooperatively-run school which has obtained the permit for Chinese-foreign cooperation in running the school shall
register in accordance with the relevant laws and administrative regulations, and the registering authorities shall process the registration
timely in accordance with the relevant provisions.
Chapter III Organization and Administration
Article 21 A Chinese-foreign cooperatively-run school with the legal person status shall set up a board of trustees or a board of directors,
and a Chinese-foreign cooperatively-run school without the legal person status shall set up a joint managerial committee. Chinese
members on the board of trustees, the board of directors or of the joint managerial committee shall not be less than half of the
total number.
The board of trustees, the board of directors or the joint managerial committee shall be composed of at least five members with
one of them serving as the chairperson and one of them serving as the vice-chairperson respectively. If either of the Chinese and
foreign cooperators in running the school assumes the chairpersonship, the other shall assume the vice-chairpersonship.
The legal representative of a Chinese-foreign cooperatively-run school with the legal person status shall be appointed through
consultation between the Chinese and foreign cooperators in running the school from the chairperson of the board of trustees, or
the chairperson of the board of directors, or the president of the cooperatively-run school.
Article 22 The board of trustees, the board of directors or the joint managerial committee of a Chinese-foreign cooperatively-run school shall
be composed of the representatives from both the Chinese and foreign cooperators in running the school, the president or principal
administrator of the school, the representatives of the school s teaching and administrative staff, etc., and one-third of the members
shall have at least five years of work experience in the field of education and teaching.
The list of members on the board of trustees, the board of directors or of the joint managerial committee of a Chinese-foreign
cooperatively-run school shall be submitted to the examination and approval authorities for the record.
Article 23 The board of trustees, the board of directors or the joint managerial committee of a Chinese-foreign cooperatively-run school shall
exercise the following powers:
(1) electing or by-electing the members on the board of trustees, the board of directors or of the joint managerial committee;
(2) appointing or dismissing the president or the principal administrator;
(3) modifying the articles of association and formulating school rules and bylaw;
(4) formulating development plans and approving annual work plans;
(5) raising operational funds, examining and approving the budget and the final accounts;
(6) determining the staff arrangement and quotas and the wage scales;
(7) making decisions on the division, merger or termination of the Chinese-foreign cooperatively-run school; and
(8) exercising other powers specified by the articles of association.
Article 24 The board of trustees, the board of directors or the joint managerial committee of a Chinese-foreign cooperatively-run school shall
meet at least once a year. Interim meetings of the board of trustees, the board of directors or the joint managerial committee may
be convened upon proposal made by at least one-third of its members.
The board of trustees, the board of directors or the joint managerial committee of a Chinese-foreign cooperatively-run school
shall adopt its decision upon agreement by at least two-thirds of its members when it discusses the following major issues:
(1) appointing or dismissing the president or the principal administrator;
(2) modifying the articles of association;
(3) formulating the development plan;
(4) making decisions on the division, merger or termination of the Chinese-foreign cooperatively-run school; and
(5) other major issues specified by the articles of association.
Article 25 The president or the principal administrator of a Chinese-foreign cooperatively-run school shall be a person with the nationality
of the People s Republic of China, domicile in the territory of China, love the motherland, possess moral integrity, and have work
experience in the field of education and teaching as well as compatible professional expertise.
The president or the principal administrator appointed by a Chinese-foreign cooperatively-run school shall be subject to approval
of the examination and approval authorities.
Article 26 The president or the principal administrator of a Chinese-foreign cooperatively-run school shall exercise the following powers:
(1) executing the decisions of the board of trustees, the board of directors or the joint managerial committee;
(2) implementing the development plan and drafting annual work plans, financial budget, rules and bylaw;
(3) employing and dismissing the staff and executing rewards and punishments;
(4) organizing teaching and scientific research activities and ensuring teaching quality;
(5) taking charge of daily administrative work; and
(6) exercising other powers specified by the articles of association.
Article 27 A Chinese-foreign cooperatively-run school shall administer its teachers and students in accordance with law.
Foreign teachers and administrators employed by a Chinese-foreign cooperatively-run school shall possess a bachelor s degree
or above and related occupational certificates, and have at least two years of work experience in the field of education and teaching.
The foreign cooperator shall send a certain number of teachers from its own educational institution to teach in the Chinese-foreign
cooperatively-run school.
Article 28 A Chinese-foreign cooperatively-run school shall safeguard the lawful rights and interests of its teachers and students in accordance
with law, guarantee the payment and welfare benefits of the teaching and administrative staff and pay social insurance premiums for
the teaching and administrative staff.
The teaching and administrative staff of a Chinese-foreign cooperatively-run school shall establish their trade union and other
organizations in accordance with law, and participate in the democratic governance of the Chinese-foreign cooperatively-run school
through the staff congress or other means.
Article 29 Foreign employees of a Chinese-foreign cooperatively-run school shall abide by the relevant provisions on employment of foreigners
in China.
Chapter IV Education and Teaching
Article 30 A Chinese-foreign cooperatively-run school shall offer courses on the constitution, laws, ethics of citizens and basic facts about
China, etc. in accordance with the requirements by China for educational institutions of the same type at the same level.
The State encourages Chinese-foreign cooperatively-run schools to introduce internationally advanced courses and teaching materials
that are urgently needed in China.
A Chinese-foreign cooperatively-run school shall report the courses that it offers and the teaching materials that it has introduced
in to the examination and approval authorities for the record.
Article 31 A Chinese-foreign cooperatively-run school may, if necessary, use foreign languages in teaching, but shall use the standard Chinese
language and standard Chinese characters as the basic teaching language.
Article 32 The enrollment by Chinese-foreign cooperatively-run schools offering higher education for academic qualifications shall be incorporated
into the national enrollment plan for institutions of higher learning. The enrollment by Chinese-foreign cooperatively-run schools
offering other education for academic qualifications shall be conducted in accordance with the provisions of the education administrative
departments of the people s governments of the provinces, autonomous regions or municipalities directly under the Central Government.
The enrollment of overseas students by Chinese-foreign cooperatively-run schools shall be conducted in accordance with the relevant
provisions of the State.
Article 33 The enrollment brochures and advertisements of Chinese-foreign cooperatively-run schools shall be submitted to the examination and
approval authorities for the record.
A Chinese-foreign cooperatively-run school shall publicize regularly relevant information on the type and level of its education,
its specialties and courses and its enrollment plan, etc.
Article 34 Chinese-foreign cooperatively-run schools offering education for academic qualifications shall grant academic qualifications certificates
or other education certificates in accordance with the relevant provisions of the State; those that offer education for non-academic
qualifications shall grant training certificates or course completion certificates in accordance with the relevant provisions of
the State. Students who receive vocational skill training may be granted relevant national vocational qualifications certificates
in accordance with the relevant provisions of the State if they pass the evaluation by a vocational skill evaluation organ authorized
by the government.
Chinese-foreign cooperatively-run schools offering higher education for academic qualifications may grant relevant Chinese certificates
of academic degrees in accordance with the relevant provisions of the State.
Certificates of academic qualifications or certificates of academic degrees of a foreign educational institution granted by a
Chinese-foreign cooperatively-run school shall be identical with the certificates of academic qualifications or certificates of academic
degrees issued by the foreign educational institution in its own country and shall be recognized by that country.
The recognition of certificates of academic qualifications or certificates of academic degrees of a foreign educational institution
granted by Chinese-foreign cooperatively-run schools shall be governed by the international treaties concluded or acceded to by the
People s Republic of China or the relevant provisions of the State.
Article 35 The education administrative department of the State Council or the education administrative departments, the labour administrative
departments and other related administrative departments of the people s governments of the provinces, autonomous regions or municipalities
directly under the Central Government shall strengthen their routine supervision over Chinese-foreign cooperatively-run schools,
organize or authorize intermediary organizations to evaluate the management and educational quality of the Chinese-foreign cooperatively-run
schools and publicize the evaluation results.
Chapter V Assets and Financial Matters
Article 36 Chinese-foreign cooperatively-run schools shall establish and improve their financial and accounting systems as well as their assets
management system in accordance with law, and shall keep books of accounts pursuant to the relevant provisions of the State.
Article 37 During the period of their existence, Chinese-foreign cooperatively-run schools shall enjoy the property of legal persons on all
their assets in accordance with law, and no other organizations or individuals may encroach on such assets.
Article 38 The items and standards of charges by Chinese-foreign cooperatively-run schools shall be determined and publicized in accordance
with the relevant provisions of the State on price fixing by the government; no additional items or increase in charges shall be
allowed without approval.
Chinese-foreign cooperatively-run schools shall use Renminbi instead of any foreign currencies in calculating and collecting tuition
and other fees.
Article 39 All fees collected by Chinese-foreign cooperatively-run schools shall be mainly used for educational and teaching activities and
for improving the conditions of school operation.
Article 40 Chinese-foreign cooperatively-run schools shall abide by the provisions of the State on foreign exchange control in conducting their
activities of the receipt and payment of foreign exchange and opening and using foreign exchange accounts.
Article 41 Chinese-foreign cooperatively-run schools, at the end of each fiscal year, shall prepare financial and accounting reports, commission
public auditing institutions to conduct auditing work in accordance with law, publicize the audit findings, and file such information
with the examination and approval authorities for the record.
Chapter VI Alteration and Termination
Article 42 Division or merger of a Chinese-foreign cooperatively-run school shall be reported to the examination and approval authorities for
approval, after the liquidation, by the board of trustees, the board of directors or the joint managerial committee.
In the case of an application for division or merger of a Chinese-foreign cooperatively-run school offering education for non-academic
qualifications, the examination and approval authorities shall reply in writing within three months from the date of receiving the
application; in the case of an application for division or merger of a Chinese-foreign cooperatively-run school offering education
for academic qualifications, the examination and approval authorities shall reply in writing within six months from the date of receiving
the application.
Article 43 Alteration of cooperators in running a Chinese-foreign cooperatively-run school shall be proposed by the cooperators, and after liquidation,
with the consent of the board of trustees, the board of directors or the joint managerial committee, shall be reported to the examination
and approval authorities for approval, and the relevant alteration formalities shall be undertaken.
Any alteration in the domicile, legal representative or the president or the principal administrator of a Chinese-foreign cooperatively-run
school shall be subject to examination and approval of the examination and approval authorities, and the relevant alteration formalities
shall be undertaken.
Article 44 Any alteration in the name, level or type of a Chinese-foreign cooperatively-run school shall be reported for approval by the board
of trustees, the board of directors or the joint managerial committee to the examination and approval authorities.
In the case of an application for altering a Chinese-foreign cooperatively-run school to offer education for non-academic qualifications,
the examination and approval authorities shall reply in writing within three months from the date of receiving the application; in
the case of an application for altering a Chinese-foreign cooperatively-run school to offer education for academic qualifications,
the examination and approval authorities shall reply in writing within six months from the date of receiving the application.
Article 45 A Chinese-foreign cooperatively-run school shall be terminated in one of the following cases:
(1) where a request for termination is made in accordance with the articles of association and approved by the examination and
approval authorities;
(2) where its permit for Chinese-foreign cooperation in running the school is revoked; or
(3) where it is unable to continue its operation due to insolvency and such termination is approved by the examination and approval
authorities.
A Chinese-foreign cooperatively-run school shall make proper arrangements for its students at school upon its termination; a Chinese-foreign
cooperatively-run school shall submit a plan for such arrangements while applying for termination thereof.
Article 46 A Chinese-foreign cooperatively-run school shall make liquidation in accordance with law upon termination.
Where a Chinese-foreign cooperatively-run school itself requests termination, the Chinese-foreign cooperatively-run school shall
organize liquidation; where the termination is the result of dissolution by the examination and approval authorities in accordance
with law, the examination and approval authorities shall organize liquidation; where the termination is the result of inability to
continue the operations for education due to its insolvency, a people s court shall be requested according to law to organize liquidation.
Article 47 Upon liquidation, a Chinese-foreign cooperatively-run school shall settle its outstanding debts according to the following sequence:
(1) tuition and other fees that shall be refunded to the students;
(2) salaries due to the teaching and administrative staff and their social insurance premiums payable;
(3) payments for other outstanding debts.
The remaining assets of a Chinese-foreign cooperatively-run school after the settlement of the above debts shall be handled in
accordance with the provisions of the relevant laws and administrative regulations.
Article 48 Where a Chinese-foreign cooperatively-run school is terminated after approval or its permit for Chinese-foreign cooperation in running
the school is revoked, it shall return its permit for Chinese-foreign coo
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People’s Bank of China
Order of the People’s Bank of China
No. 6
The Interim Measures for the Administration of Foreign Currency Exchange Agencies, which were adopted at the 3rd executive meeting
of the People’ Bank of China on May 28th, 2003, are hereby promulgated, and shall be implemented as of November 1st, 2003.
Zhou Xiaochuan, Governor of the People’s Bank of China
October 8th, 2003
Interim Measures for the Administration of Foreign Currency Exchange Agencies
Article 1
The present Measures are formulated in accordance with the Law of the People’s Republic of China on the People’s Bank of China, Regulations
of the People’s Republic of China on Foreign Exchange Administration, Regulations on Settlement and Sales of and Payment in Foreign
Exchange, Interim Measures for Settlement and Sales of and Payment in Foreign Exchange by Designated Foreign Exchange Banks as well
as other relevant provisions with a view to regulating the foreign exchange business of the foreign exchange agencies and safeguarding
the market order.
Article 2
The term “foreign currency exchange agencies” as mentioned in the present Measures refers to the domestic entities with legal person
status (hereinafter referred to as “exchange agencies”) that have signed agreements with the domestic commercial banks or their branches
(hereinafter referred to as “banks”) eligible for foreign currency exchange business (or settlement and sales of foreign exchange)
and are authorized by banks to do foreign currency exchange business.
Article 3
The foreign currency exchange business by the exchange agencies is limited to the exchange of banknotes and traveler’s checks in convertible
foreign currencies.
When conducting foreign currency exchange business, the exchange agencies are limited to convert foreign currency banknotes or traveler’s
checks held by domestic resident individuals or non-resident individuals into RMB.
Where a non-resident individual needs to convert his or her RMB holdings obtained from an exchange agency back into foreign currency,
he or she needs to handle it with the bank that authorizes the exchange agency to conduct the currency exchange business for handling.
The value of re-conversion is not allowed to exceed that of the previous conversion. Re-conversion shall be effected within 6 months
as of the day of the initial conversion.
Resident individuals are not permitted to convert the exchanged RMB back into foreign currencies.
Article 4
The State Administration of Foreign Exchange (SAFE) and its branches shall make supervision over and regulation of the foreign currency
exchange business conducted by the bank-authorized exchange agencies according to the laws and regulations.
Article 5
The head offices of commercial banks shall establish uniform internal regulatory rules and risk management system for authorization
of foreign currency exchange business.
Authorizing banks shall, in accordance with its head office’ regulatory rules and risk management system, establish regulatory rules
and operational procedures. The contents shall include the following elements: regulation over foreign currency quotation of the
exchange agencies; regulation over settlement of foreign currency exchange business; regulation over the application, use, invalidation,
verification of foreign currency exchange receipts; risk management and cost-sharing of losses caused by currency exchanges; resolution
of disputes; stipulation on currencies that can be exchanged; setting upper limits for RMB or foreign currency cash stock; and management
of staff involved in foreign currency exchange business, etc.
Article 6
The bank shall, when authorizing exchange agencies to conduct foreign currency exchange business, sign a written agreement with the
exchange agencies on the authorization of foreign currency exchange business, which specifies the rights and obligations of both
parties and the guidelines for disputes resolution. This written agreement shall contain the main contents of regulatory rules and
operational procedures indicated in Article 5 and shall be filed in the local SAFE branch. The exchange agencies are not permitted
to conduct foreign currency exchange business before the filing of the written agreement is confirmed.
Article 7
When handling the formalities of filing, an authorizing bank shall submit the following materials:
(1)
Unified internal regulatory rules and risk management system for authorization of foreign currency exchange business formulated by
its head office.
(2)
Application form of the exchange agency to conduct foreign currency exchange business.
(3)
Statement of basic information of the exchange agency.
(4)
Regulatory rules on authorizing foreign currency exchange business.
(5)
Written agreement signed on authorizing foreign currency exchange business.
(6)
Samples of foreign exchange sales statement and the seals used in the business.
(7)
Other materials required by the SAFE and its branch.
The SAFE and its local branch shall issue a responding letter, within 30 days as of the day when such materials are received, to confirm
or reject the filing. If the filing is rejected, the reason shall be explained in the aforesaid letter. The authorizing bank, which
receives a letter from the Local SAFE branch rejecting the filing, shall not submit the same filing application for a second time
within 6 months since the day when the responding letter is received.
Article 8
The business venue of the exchange agencies for foreign currency exchange shall in principle be located in places with large flows
of people, such as ports, airports, railway stations, piers, scenic spots, border entry areas, main commercial areas, and hotels
eligible for receiving overseas guests.
Article 9
Where an exchange agency conduct foreign currency exchange business, it shall conform to the following requirements:
(1)
Having the domestic corporate legal person status.
(2)
Having a permanent business venue.
(3)
Having at least 2 staff members to conduct foreign currency exchange business, who shall be trained by the authorizing bank, and eligible
for such business.
(4)
Having equipment and related facilities that can receive accurate and timely quotation of foreign currencies from the authorizing
bank.
(5)
Other conditions required by the authorizing bank.
Article 10
An exchange agency is limited to sign the agreement on authorization of foreign currency exchange business with one bank located in
the same city, and may not sign such agreements with multiple banks or with banks in other cities.
An exchange agency may open multiple business venues for foreign currency exchange as agreed upon by the authorizing bank.
Article 11
Where the authorizing bank terminates its agreement with the exchange agency on foreign currency exchange business, it shall file
the termination with the Local SAFE branch within 10 days after the agreement is terminated.
Article 12
An exchange agency shall hang its plate at its business venue, indicating “Foreign Currency Exchange Agency of (name of the authorizing
bank)”. The authorizing bank shall be responsible for providing and administering the format of such a plate.
Article 13
The exchange agency shall conduct foreign exchange business according to the authorizing banks’ rules on foreign currency quotation,
and publish the quotation at an eye-catching position of its business venue.
Article 14
Separate accounting shall be adopted for foreign currency exchange business of exchange agencies.
Article 15
An exchange agency shall, when conducting foreign currency exchange business, use specified foreign currency exchange form and may
not use any other forms instead. Such a form shall be provided and administering by the authorizing bank.
The foreign currency exchange form shall contain, but not be limited to, the following information:
Name of the customer; nationality of the customer; type of the ID certificate and the ID number; date of the exchange; type of foreign
currency to be exchanged; value of the foreign currency and the RMB; and quotation of the foreign currency, etc.
The copy of foreign currency exchange form kept by the exchange agency shall be signed by the customer and stamped by the responsible
business processing staff to be validated. When filling in the currency exchange form, the exchange agency shall autotype at least
three copies. One copy shall be kept by the customer, while another one shall be kept by the authorizing bank and the last one shall
be kept by the exchange agency for accounting purposes. The authorizing bank and exchange agency shall keep these forms for 5 years
for the purpose of later check-up.
Where the exchange agency converts foreign currency into RMB for domestic resident individuals, it shall indicate on the currency
exchange form “exchange back into foreign currency not permitted”.
Article 16
An exchange agency shall abide by the authorizing bank’s rules for the storage, surrender and upper limit on the stock of foreign
currency.
The authorizing bank shall set an upper limit on the stock of foreign currency conducted by the exchange agency, and the limit may
in principle not exceed USD10, 000 or the equivalent value of foreign currencies at the conclusion of each business day.
Article 17
The authorizing bank is responsible for the training of staff in exchange agencies engaging in foreign currency exchange business.
Staff of exchange agencies engaging in foreign currency exchange business shall possess the following conditions:
(1)
Capability of verifying foreign currency banknotes and traveler’s checks.
(2)
Corresponding knowledge of the regulations on foreign exchange administration.
(3)
Other capabilities required by the internal control system of the authorizing bank.
Article 18
The authorizing bank shall fulfill its obligations of statistical reporting and report the foreign currency exchange business of all
its authorized exchange agencies on a consolidated basis, in accordance with the Measures for Reporting of International Balance
of Payments Statistics, other relevant provisions, and the reporting requirements for commercial banks when conducting the business
of settlement and sales of foreign exchange.
Article 19
The authorizing bank shall see to it that the exchange agencies are conducting foreign currency exchange business according to the
agreement signed between them. In the case of improper use of currency exchange forms and/or violation of rules on quotation of foreign
currency or other regulations of the SAFE, the authorizing bank shall take corrective measures and report such violations to the
local SAFE branch in good time.
Article 20
Any authorizing bank and its exchange agencies is involved in any the following act, they shall be punished by the local SAFE branch:
(1)
Where an exchange agency opens foreign currency exchange business without filing the required application materials with the local
SAFE branch, the authorizing bank and the foreign currency exchange agency shall be punished by the local SAFE branch according to
Article 41 of the “Regulations of the People’s Republic of China on Foreign Exchange Administration”.
(2)
Those setting quotation of foreign currency in violation of the relevant regulations on exchange rate shall be punished by the local
SAFE branch according to Article 43 of the Regulations of the People’s Republic of China of Foreign Exchange Administration.
(3)
Where an authorizing bank fails to make sure that the exchange agencies properly use the specified form to conduct foreign currency
exchange business according to the provisions, it shall be punished by the local SAFE branch according to Article 42 of the Regulations
of the People’s Republic of China on Foreign Exchange Administration and Article 40 of the Interim Measures for Settlement and Sales
of Foreign Exchange by Designated Foreign Exchange Banks.
(4)
Where an authorizing bank and its authorized exchange agencies are found in any other violation of foreign exchange administration,
they shall be punished by the local SAFE branch in accordance with the relevant rules.
Article 21
For a foreign currency exchange agency established before the present Measures come into force, its authorizing bank shall, according
to the provisions of the present Measures, do the remedial filing formalities with the local SAFE branch within 2 months after the
day they come into force.
Article 22
The present Measures shall be implemented as of November 1, 2003.
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