The State Administration of Foreign Exchange (SAFE) has recently published the Circular of the State Administration of Foreign Exchange on Regulating Large-sum Overseas Cash Withdrawals with Bank Cards (Huifa No. 29 [2017]) (Circular) to regulate large-sum cash withdrawals overseas with bank cards and enhance regulation against cross-border money laundering.

The highlights of the Circular include: first, in overseas cash withdrawals by individuals with domestic bank cards, the sum of withdrawals using the bank cards under the name of the individual (including additional cards) shall not exceed the equivalent of RMB 100,000 in every civil year. Second, the daily quota per card for overseas cash withdrawals with RMB cards and foreign currency cards is the equivalent of RMB 10,000. Third, in case of overseas cash withdrawals in excess of the annual quota, the individuals will not be allowed to withdraw cash overseas with the domestic bank cards in the current and second years. Fourth, individuals are prohibited from borrowing others' bank cards or lending their bank cards to evade or help evade the management of overseas cash withdrawals.

The SAFE supports individuals' use of bank cards overseas in compliance with regulations. Regulating large-sum overseas cash withdrawals with bank cards is crucial to cracking down on money laundering, terrorist financing and tax evasion, and can help guard against illegalities associated with cash withdrawals with bank cards. The Circular, aligned with the requirement of ensuring currency convertibility under the current account, does not contradict with the annual quota of USD 50,000 for foreign exchange purchases by individuals, or impact individuals' normal withdrawals of cash and consumption, or the convenience for individuals to use foreign exchange.

This Circular will become effective on January 1, 2018.