Chinese banks will be allowed to open domestic foreign exchange accounts for overseas institutions

The State administration of foreign exchange yesterday issued a draft to allow Chinese banks to open domestic foreign exchange accounts for foreign institutions, and to prevent foreign currency accounts in foreign institutions from becoming illegal outflow of funds into the channel.　　The report of the foreign exchange administration on issues relating to the administration of foreign exchange accounts in the territory of foreign institutions (draft) (hereinafter referred to as "notice") the purpose is to standardize the opening and use of foreign exchange accounts in foreign institutions, and to fill in the gaps in the management of foreign exchange accounts in foreign institutions.　　The notice abandons the practice that only foreign banks can open foreign exchange accounts for overseas institutions for historical reasons, and allows Chinese banks to open domestic foreign exchange accounts for foreign institutions, and at the same time simplifies the auditing procedures for opening accounts and relaxes the restrictions on the exchange of foreign currency accounts and foreign exchanges between overseas institutions.　　In the statement issued on the same day, the report said that these measures are conducive to domestic banks and enterprises to handle foreign-related business, especially to facilitate the centralized management and operation of funds of foreign investment enterprises.　　Safe's note also introduces, enterprises, especially large enterprises believe that such provisions will facilitate foreign investment enterprises in China to open foreign exchange accounts to operate offshore funds, to protect their capital security, especially in the financial crisis, it is particularly important. In addition, Safe said the notice helps prevent risks and prevents foreign exchange accounts in foreign institutions from becoming a conduit for illegal outflows of funds.　　The notice requires foreign Exchange account balances in foreign institutions to be managed by external debt indicators, without settlement or withdrawal of foreign currency cash. By the end of 2008, foreign institutions in the territory opened a foreign exchange account more than 100,000 households. These accounts are scattered in different documents because of their different nature, the sources said. Some even do not have any norms, resulting in these foreign exchange accounts in the main nature of the identification, gross statistics, or in the authenticity of foreign exchange payments audit, have brought a certain degree of management hidden dangers, easy to become a hotbed of criminal activities,　　Financial turmoil in the case is easy to become a large number of foreign exchange funds access channels. According to people familiar with foreign exchange management, the impact of the global financial crisis, the withdrawal of foreign exchange funds at the beginning, so to prevent large-scale outflow of foreign exchange funds, has replaced the response to "hot money" pressure, to become a phased focus of foreign exchange management. Financial)