The System for External Financial Assets, Liabilities, and Statistics on Transactions (Huifa No.43 [2013], hereinafter referred to as “the System”) was recently promulgated by the State Administration of Foreign Exchange (SAFE). With adoption of the newest international statistical standards the System represents a complete revision of the Operating Procedures of Financial Institutions for the Declaration of Overseas Assets, Liabilities, and Profits and Losses promulgated in 1996, and shall be implemented as of September 1, 2014.

The System makes significant improvements to the entities, contents, and frequency of the declarations. According to the System, the entities for the declarations include corporate entities in the banking sector, the securities sector, the insurance sector, and other corporate entities engaging in financial intermediary businesses, the leading reporting branches/sub-branches of overseas financial institutions within the territory of China, and other designated institutions. The content of the declarations is extended from the stock of external financial assets and liabilities to the stock and flow of external financial assets and liabilities and other related balance-of-payments transactions. The frequency of the declarations is adjusted from a quarterly to a monthly basis.

With implementation of the System on September 1, 2014, China will be able to meet the newest statistical standards of the IMF’s Balance of Payments and International Investment Position Manual in terms of data acquisition. In addition, it will meet the requirements for monitoring and statistics on cross-border capital flows, thus laying a foundation for supervision and risk-monitoring of foreign-related economic entities and satisfying the growing demand for macro-economic analysis and decision-making both at home and abroad.