Open Governance
Guideline on Cross-Border Capital Settlement Business in New Types of Offshore International Trade Released

On May 25, the State Administration of Foreign Exchange (SAFE) Sichuan Branch released the Guideline on Cross-Border Capital Settlement Business in New Types of Offshore International Trade ("the Guideline" for short), aiming to boost new forms and models of foreign trade in Sichuan. This is also a move to implement the Notice on Issues Concerning Supporting the Development of New Types of Offshore International Trade issued by the People's Bank of China (PBC) and SAFE in the province. 

The Guideline, based on local conditions, encourages banks to find new models of capital settlement business in new types of offshore international trade and helps them refine service classification. The focus should be put on Sichuan's traditionally competitive sector, namely the offshore trade under overseas contracted projects undertaken by relevant companies, and the priority should be given to supporting manufacturing enterprises in doing business overseas, including new types of offshore international trade conducted by these manufacturers to plan production and procurement for more complete industrial and supply chains. At the same time, the Guideline asks banks to meet the needs of airlines, ocean-going vessels, and berthing cruise ships to buy fuels and supplies, change (repair) equipment, and mail or sell products abroad. According to the Guideline, enterprises are encouraged to purchase and sell across the world, and multinational corporations establish global centralized purchasing centers. 

Besides, the Guideline is designed to coordinate the relationship between business development and compliant operation, promote the establishment of a risk prevention and control system covering the stages before, during, and after accidents in banks, and block all ways to repeatedly get bank funds via fictitious transactions. It represents the principle of sticking with the essence of trade.

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