The branches and foreign exchange administrative departments of the State Administration of Foreign Exchange (SAFE) of all provinces, autonomous regions, and municipalities directly under the Central Government; the branches of the SAFE in Shenzhen, Dalian, Qingdao, Xiamen, and Ningbo; and national Chinese-funded banks:

To further improve the business environment and serve the high-quality growth of the real economy, the SAFE decides to optimize foreign exchange administration and improve foreignexchange services to enhance cross-border trade and investment facilitation. Relevant issues are notified as follows:

I. Optimizing foreign exchange administration

(1) Rolling out nationwide the facilitation reform forreceipts and payments under the capital account. While ensuring funds are used for true businesses and in compliance with regulations and the existing management provisions on use of receipts under the capital account, eligible companies will be allowed to use receipts under the capital account such as foreign exchange capital, external debts and funds raised through overseas listing for domestic payments, without submitting authentication materials to banks beforehand on a transaction-by-transaction basis. The administering banks shall control relevant risks in line with the prudential business principles, and perform ex-post sampling of facilitated receipts and payments under the capital account they handle in accordance with relevant requirements. Local foreign exchange authorities shall intensify monitoring and analysis, as well as mid- and post-transaction regulations.

(2) Cancelling registration forspecial foreign exchange refunding. Category-A companies in the list of companies receiving and paying foreign exchange under trade in goods will be waived of prior registration with foreign exchange authorities and can handle them directly with financial institutions instead, if they need a refunding of foreign exchange that is a maximum of US$50,000 (US$50,000 is permitted) and the interval between the refunding date and the receiving or payment date is more than 180 days (180 days is not permitted) during a calendar year or if the foreign exchange cannot be refunded in the original route for special reasons. In such cases, financial institutions shall state "special foreignexchange refunding" in the remarks for foreign-related receipts and payments declaration.

(3) Simplifying registration management for somecapital account businesses. Eligible overseas loans under domestic guarantee and overseas lending will be delegated to banks for write-off registration. Non-financial companies who have been relieved of the responsibilities for or have not performed the contracts for overseas loans under domestic guarantee will be allowed to go through write-off registration for overseas loans underdomestic guarantee with banks within the jurisdictions of local SAFE branches (foreign exchange administration departments). Non-financial companies whose overseas lending expires, and whose principal and interest have been collected, can go to banks within the jurisdictions of local SAFE branches (foreign exchange administration departments) directly for write-off registration foroverseas lending.

(4) Relaxing the requirements on exporters for paying domestic foreign exchange loans with foreign exchange purchased. For domestic foreign exchange loans like outward bills thatare in the foreign exchange settlement accounts under the current account asrequired by relevant provisions, with foreign exchange settled, companies shall, in principle, pay the loans with foreign exchange it holds or foreign exchange it receives from export under trade in goods. But if companies cannot receive foreign exchange for exports as scheduled and have no other foreign exchange on hand to pay the domestic foreign exchange loans, the lending bank shall handle foreign exchange purchases for repayment in accordance with the prudential business principles, and report such cases to local foreign exchange authorities within five working days at the beginning of each month.

II. Improving foreign exchange services

(5) Facilitating the use of EDI for foreign exchange businesses. If banks handle foreign exchange receipts and payments for trade in goods by reviewing electronic data interchange (EDI), the conditions that such companies must be category-A companies and must have beenin operation for two years will be canceled. If banks handle foreign exchange receipts and payments for trade in services, primary income and secondary income by reviewing EDI, electronic transaction documents cannot be necessarily printed. For personal foreign exchange settlement and sales handled by banks, the "notice for foreign exchange settlements / sales" cannot necessarily be printed. In such cases, banks must ensure the authenticity, compliance and exclusive use of EDI, and keep EDI or electronic information for five years for future reviews.

(6) Optimizing foreign exchange settlement by banks for cross-border e-commerce. More banks will be encouraged to handle foreign exchange settlement and sales, and receipts and payments of related funds for cross-border e-commerce players, based on electronic transaction information in accordance with the Circular of the State Administration of Foreign Exchange on Printing and Issuing Measures for the Administration of Foreign Exchange Business of Payment Institutions (SAFE Document No. 13 [2019]), as long as they meet the conditions of transaction information collection and authentication.

(7) Simplifying endorsement procedures for business reviews. When reviewing foreign exchange receipts and payments under the current account as required, financial institutions can decide at their discretion whether to endorse the amount and date of receipts or payments and to affix a business chop on the original documents, in accordance with internal control requirements and real businessneeds, and in line with the substantial compliance principle. But they need to keep the review materials for future reviews, in accordance with existing regulations.

(8) Supporting banks to innovate financial services. Banks will be encouraged to evaluate companies' credit in diverse ways, categorizing companies having difficulties inforeign-related receipts and payments due to objective and uncontrollable factors, extending the payment period and simplifying procedures for foreign exchange loans to micro, small and medium-sized businesses with promising prospects. Banks will also be encouraged to leverage information available onthe digital foreign exchange administration platform (ASOne) such as corporate credit and foreign exchange rates to do business in compliance with regulations, innovate businesses and deliver high-quality financial services tomicro, small and medium-sized foreign-related businesses.

This Circular will become effective as of the date of issuance (However, Section Three under Article I will come into force on June 1, 2020 after the capital account information system is upgraded). This Circular will prevail over anyprevious regulations if there is any discrepancy. Upon receiving this Circular, SAFE branches and foreign exchange administration departments shall forward it to the central sub-branches, sub-branches, city commercial banks, rural commercial banks, foreign-owned banks, and rural cooperative banks within their jurisdictions in time, and national Chinese-funded banks shall forward it to  the branches and sub-branches within their jurisdictions in time. Please give feedback to the SAFE promptly if there is any problem with implementation.

The State Administration of Foreign Exchange

April 10, 2020