Notice on the Arrangements for Overseas Banks to Participate in Interbank FX Market Regional Trading

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Publishing date: 2018-01-05 16:45:00

In order to actively cooperate with the “Belt and Road Initiative”, promote development of Interbank FX Market regional trading and improve the efficiency of bilateral currency settlement, according to the Announcement No.402 [2017] ofPeople's Bank of China(PBC) and related market entry rules released by China Foreign Exchange Trade System(CFETS). CFETS will introduce qualified overseas banks to participate in Interbank FX Market Regional Trading, and hereby announces arrangements as follows: 

I.Market Access Criteria

Overseas Participating Banks and Clearing Banks from host countries of regional trading listed currencies with RMB purchases and sales business (including overseas foreign banks and overseas sub-branches of Chinese banks, etc.) can apply to CFETS for Participating banks and Quoting banks of China Interbank FX Market Regional Trading according to their business needs and conduct corresponding transactions through CFETS trading system.

Overseas Participating Banks and Clearing Bankswiththe membership of China Interbank FX Market and only conducting RMB-FX regional trading in China Interbank FX Market shall no longer conduct RMB purchases and sales oncorresponding currencies via domestic agent banks.

II. Application Procedure

1. Qualified overseas banks submit application documents to local sub-branchesof PBCin corresponding regions.

2. Overseas banks approved by local sub-branches of PBC and filed in PBC can apply to CFETS for the Interbank FX Market membership.

3. CFETS sends the formal market entry notice to institutions that submitted complete application documents and met the statutory requirements, approving them to be members of Interbank FX Market. CFETS will publish announcement on www.chinamoney.com.cn, etc.

4 The institutions complete preparation work including networkconnection, system access, Member Agreement signing, and bilateral credit authorization to become Interbank FX Market Regional Trading Participating banks and Quoting banks and conduct regional trading of corresponding currencies through CFETS trading system.

III. Monitoring and Regulations

1. The domestic Quoting Banks and Participating Banks should confirm that transactions should maintain in accordance with the requirements for authenticity verification of trade in goods and serviceor direct investment, etc. The underlying contracts, bills of lading, invoices and other evidence to prove authenticity will be required during the authenticity review process, whether provided by the domestic banks themselves or their overseas counterparties. The local sub-branches of PBC review the documentary evidences for the authenticity verification requirements of domestic banks according to the actual situation.

2. The overseas regional trade Participating Banks and Quoting Banks conducting RMB-FX regional transactions through CFETS trading system shall report related details of RMB purchases and sales through the information reporting panel onCFETS Post-Trade Processing Platform at the end of each trading day (no later than 8:00 AM of the next trading day). Reported details include the name of the parties that purchase or sell RMB, their nationality and region, transaction amount and purpose, etc. The domesticcounterparties are obligated to report cross-borderRMB purchases and saleinformation through the RMB Cross Border Payment & Receipt Management Information System (RCPMIS).

IV. Contact Information

Tel: 4009787878*1*2; 86 021-23165107; 86021-23165164

Email: fx_mkt@chinamoney.com.cn

 

China Foreign Exchange Trade System

Jan.4, 2018