The branches and foreign exchange administrative departments of the State Administration of Foreign Exchange (SAFE) in all provinces, autonomous regions, and municipalities directly under the Central Government; the branches in Shenzhen, Dalian, Qingdao, Xiamen, and Ningbo; and the head offices of designated Chinese-funded foreign exchange banks:
To standardize and improve foreign exchange administration for overseas listings, relevant issues are hereby notified in accordance with the Regulations of the People's Republic of China on Foreign Exchange Administration:
I. The overseas listing herein refers to the overseas public offering of securities allowed by laws and regulations (overseas shares), including shares (such as preferred shares and share-based derivative securities) and corporate bonds convertible to shares, and public trading of these overseas shares on an overseas stock exchange by a joint stock limited company registered in China (domestic company) upon the approval from the China Securities Regulatory Commission (CSRC).
II. The SAFE, its branches/sub-branches and foreign exchange administrative departments (hereinafter referred to as foreign exchange authorities) supervise, administrate and inspect the activities including transaction registration, account opening and use, cross-border receipts/payments and funds remittance involved in overseas listings of domestic companies.
III. A domestic company shall, within 15 working days after completion of the overseas listing, register for overseas listing with the foreign exchange authority in the locality where it has been incorporated (local foreign exchange authority) by presenting the following documents:
(I) A written application attached with the Registration Form for Overseas Listing (Appendix 1);
(II) Document evidencing the CSRC's approval for overseas listing by domestic companies;
(III) Announcements for the completion of the overseas offering;
(IV) The required supplementary materials, if the contents of the above materials are not consistent or cannot prove the authenticity of the transaction.
The local foreign exchange authority shall, after verifying the above documents are accurate, register the domestic company in the capital account information system (System), print the transaction registration certificate through the System, and issue the certificate to the domestic company after affixing its official seal to it. The domestic company shall use the registration certificate to open an account for overseas listing and conduct relevant transactions.
IV. After a domestic company's overseas listing, where its domestic shareholders plan to increase/decrease the shares they hold in the company in accordance with relevant regulations, the said shareholders shall present the following materials to the local foreign exchange authority for overseas shareholding registration within 20 working days before the proposed share increase/decrease:
(I) A written application attached with the Registration Form for Overseas Shareholding (Appendix 2);
(II) Resolution of the meeting of the board of directors or shareholders' general meeting on the proposed increase/decrease (if any);
(III) Approval documents from relevant departments such as the finance department and state-owned assets management authorities if necessary;
(IV) The required supplementary materials, if the contents of the above materials are not consistent or cannot prove the authenticity of the transaction.
The local foreign exchange authority shall, after verifying the above documents are accurate, register the domestic shareholder in the System, print the transaction registration certificate through the System, and issue the certificate to the domestic shareholder after affixing its official seal to it. The domestic shareholder shall use the registration certificate to open account(s) for increasing/decreasing the shares they hold in the overseas-listed company and conduct relevant transactions.
V. A domestic company (other than banking financial institutions) shall use the registration certificate for overseas listing to open a special foreign exchange account for overseas listing of a domestic company (special account for overseas listing of domestic company) for its initial public offering (or subsequent offering) and repurchase with a domestic bank for funds remittance and transfer under relevant transactions (see Appendix 3 for the account type, scope of receipts/payments and notes).
VI. A domestic company (other than banking financial institutions) shall open an RMB account for foreign exchange settlement and pending payment (unpaid account) with the bank who has opened for it the special account for overseas listing, for the company to deposit the RMB funds it receives from foreign exchange settled under its special account for overseas listing, the repatriated RMB funds raised through overseas listing, and the RMB funds remitted outward for repurchase of oversea shares, and the remaining repatriated funds after repurchase (see Appendix 3 for the range of receipts/payments under the account).
VII. A domestic shareholder of an overseas listed company shall present the overseas shareholding registration certificate to open a special account for overseas shareholding with a domestic bank for funds remittance and transfer under relevant transactions involved in the increase/decrease or transfer of the shares he/she holds in the company (see Appendix 3 for the account type, scope of receipts/payments and notes).
VIII. A domestic company and its domestic shareholders may open corresponding special overseas accounts overseas for the purpose of handling transactions involved in overseas listing (special overseas account). The scope of receipts/payments made via the overseas special overseas account shall meet the relevant requirements under Appendix 3.
IX. A domestic company’s funds raised through overseas listing may be repatriated or deposited overseas, provided that the use of funds shall be consistent with the relevant terms and conditions set out in its disclosure documents including prospectus or corporate bonds issuance prospectus, announcement to shareholders, and resolution of board of directors or shareholders' general meeting (disclosure documents).
A domestic company shall, in case of repatriation of the funds raised through issuing corporate bonds convertible to shares, remit the funds in its special domestic account for foreign debts and go through relevant procedures in accordance with regulations on foreign debts management. In case of proposed repatriation of the funds raised through offering of other types of securities, the company shall remit the funds in its special account for overseas listing (foreign exchange) or unpaid account (RMB).
X. A domestic company may, in case of repurchase of its oversea shares, use eligible overseas and domestic funds pursuant to relevant regulations. The domestic company shall, in case of its use and outward remittance of domestic funds, go through funds transfer procedures with the opening bank through its special account for overseas listing (foreign exchange) or unpaid account (RMB), by presenting the registration certificate for overseas listing obtained after it registers the information relevant to the repurchase (including change if any) with the local foreign exchange authority (the company shall register the repurchase-related information within 20 working days prior to the proposed repurchase if it has not done so), and other explanatory materials or evidence.
Upon completion of repurchase, any remaining funds previously remitted overseas for the repurchase shall be remitted back to its special account for overseas listing (foreign exchange) or unpaid account (RMB) of the domestic company.
XI. A domestic company may apply to the opening bank, by presenting its registration certificate for overseas listing, for domestic transfer of or payment with funds under the special account for overseas listing, or for transfer of the funds to its unpaid account after the foreign exchange funds are settled, whenever necessary.
XII. A domestic company shall, in case of domestic transfer of or payment with the funds under the unpaid account, present to the opening bank the document evidencing the consistency between the use of funds set forth in its disclosure documents for overseas listing and the purpose of repatriation and foreign exchange settlement; if the purpose is inconsistent with the use of funds specified in the disclosure documents or not specified in its disclosure documents, the company shall provide the resolution of its board of directors or shareholders' general meeting on change or clarification of the uses of relevant funds. The remaining repatriated funds for repurchase of overseas shares by the domestic company can be transferred directly or used to make payments within China.
The opening bank shall, after careful review of the purpose of funds in the special account for overseas listing or unpaid account of the domestic company, conduct the transfer or payment for the company.
XIII. A domestic shareholder may use eligible overseas and domestic funds to increase the oversea shares he/she holds in the domestic company in accordance with relevant regulations. A domestic shareholder shall, in case of its use and outward remittance of domestic funds, go through funds remittance procedures with the opening bank through his/her special account for overseas shareholding, and by presenting the registration certificate for overseas shareholding and explanatory documents or evidence regarding the share increase.
Upon completion of the share increase, the remaining funds previously remitted overseas for share increase (if any) shall be remitted back into his/her special account for overseas shareholding. The domestic shareholder can apply to the bank for domestic transfer or foreign exchange settlement by presenting the registration certificate for overseas shareholding.
XIV. The proceeds under the capital account from decrease/transfer of overseas shares of the domestic company by a domestic shareholder or from delisting from an overseas stock exchange by the domestic company may be deposited overseas or remitted back into the special account for overseas shareholding of domestic shareholder. In case of repatriation, the domestic shareholder may apply to the bank for domestic transfer or foreign exchange settlement by presenting the registration certificate for overseas shareholding.
XV. A domestic company shall, within 15 working days as of the day when the following changes occur, go to the local foreign exchange authority for alteration registration by presenting a written application, updated Registration Form for Overseas Listing, and documents evidencing the authenticity of relevant transactions. In case of changes required to be approved or filed by a competent authority, the domestic company shall also present the reply or filing document for the alteration from the competent authority.
(I) change in name, registered address, or major shareholder(s) of the overseas listed company;
(II) change in capital including subsequent offering (including over-allotment) and conversion of capital reserve, surplus reserve or undistributed profits to share capital;
(III) repurchase of overseas shares;
(IV) conversion of convertible bonds to shares (for which the certificate for alteration or cancellation of registration for foreign debt is required);
(V) change in shareholding structure of overseas listed company upon completion of increase/decrease, transfer or receipt of overseas shares by domestic shareholder;
(VI) change in utilization plan and purpose which are originally registered for the funds raised overseas; and
(VII) change in other relevant registered information.
XVI. In case that a state-owned shareholder of the domestic company is required to contribute the proceeds from share decrease to the National Social Security Fund (social security fund) in accordance with the Interim Measures for Social Security Funds Raised through Decrease of State-owned Shares (Guofa No. 22 [2001]), the domestic company shall handle on behalf of the shareholder this matter, remit and transfer the relevant funds through its special account for overseas listing and unpaid account.
The domestic company shall present the documents including the explanation of the proceeds from share decrease that should be contributed to the social security fund by the state-owned shareholder (including estimation of the proceeds and amounts required and expected to be contributed) and registration certificate for overseas listing to the opening bank which its special account for overseas listing and unpaid account are opened with, and apply for direct transfer of the proceeds from the share decrease (or transfer of the proceeds after foreign exchange is settled and transferred to the unpaid account) to a correspondent account which the Ministry of Finance has opened with a domestic bank.
XVII. The reasonable fees relevant to overseas listing paid by a domestic company to overseas institutions including overseas regulatory authorities, stock exchange, undertaking institutions, lawyers and accountants shall be deducted from the funds raised through overseas listing, and in case that outward remittance of domestic funds is actually required (including outward remittance through foreign exchange purchase), the domestic company shall apply to the bank by presenting the following documents:
(I) registration certificate for overseas listing;
(II) list of payments for overseas listing which indicates the amount remitted overseas (including outward remittance through foreign exchange purchase) and corresponding items, and relevant certifying documents; and
(III) taxation certificate evidencing the withholding of overseas corporate or personal income tax, in case that relevant overseas institutions are required to pay taxes to the domestic taxation authorities.
XVIII. A domestic company shall, within 15 working days after its delisting from an overseas stock exchange, present the photocopies of relevant replies from its competent authorities, delisting announcement and other documents that prove the authenticity of the matter, as well as the registration certificate for overseas listing, and explanation on disposal of the relevant accounts and funds to the local foreign exchange authority to cancel the registration of overseas listing. The local foreign exchange authority shall take back the domestic company's registration certificate for overseas listing.
XIX. The opening banks of a domestic company and its domestic shareholders shall report after the opening, change or closing of their relevant domestic accounts the information on the accounts in accordance with the Circular of the SAFE on Releasing the Rules for Collecting Data on Foreign Exchange Transactions by Financial Institutions (V1.0) (Huifa No.18 [2014]).
XX. A domestic company, its domestic shareholders and relevant domestic banks shall make declaration of the balance of payments statistics on a timely basis in accordance with relevant regulations.
XXI. In case that a domestic company, its domestic shareholders and relevant domestic banks violate this Circular, the foreign exchange authority can take regulatory measures in accordance with laws and impose administrative penalties pursuant to the Regulations of the People's Republic of China on Foreign Exchange Administration.
XXII. The issues related to foreign exchange administration for overseas listing of domestic financial institutions shall be addressed in accordance with this Circular, unless settlement of foreign exchange for repatriated funds raised through overseas listing of domestic banking and insurance institutions is otherwise specified.
XXIII. A domestic company that has been registered for overseas listing prior to the release of this Circular shall handle relevant matters in the following principles:
(I) in case that the company has opened relevant accounts, and not all funds has been repatriated and settled, or in case of share allotment or subsequent offering which involves cross-border funds and foreign exchange settlement and purchase, the said company shall present its business registration certificate, to the opening bank to open an unpaid account, and handle subsequent business in accordance with this Circular.
(II) in case that relevant accounts have not yet opened, this Circular shall prevail.
XXIV. The application materials and the materials for registration and filing that are required under this Circular shall be made in Chinese and legally binding. Where there are versions in multiple languages, such as Chinese and other languages, the legally binding Chinese version shall prevail.
XXV. This Circular shall be construed by the SAFE.
XXVI. This Circular shall come into force as of the date of release, while the Circular of the State Administration of Foreign Exchange on Foreign Exchange Administration for Overseas Listings (Huifa No. 5 [2013]) shall be repealed. This Circular shall prevail in case of inconsistencies between other relevant foreign exchange regulations and this Circular.
Upon receipt of this Circular, the SAFE branches shall forward it to central sub-branches, sub-branches, urban commercial banks, and foreign banks under their jurisdiction as early as possible, while the designated Chinese-funded foreign exchange banks shall, upon receipt of this Circular, forward it to their respective branches and sub-branches under their jurisdiction as early as possible. Please contact the Capital Account Administration Department of the SAFE if any difficulties are encountered in implementing this Circular.
Appendices: 1. Registration Form for Overseas Listing
2. Registration Form for Overseas Shareholding
3. List of Relevant Accounts for Overseas Listing
State Administration of Foreign Exchange
December 26, 2014
FILE: Appendix1 Registration Form for Overseas Listing
FILE: Appendix2 Registration Form for Overseas Shareholding
FILE: Appendix3 List of Relevant Accounts for Overseas Listing
