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What is The Foreign Exchange Control?

Updated:2021-11-2 19:00:49    Source:www.tannet-group.comViews:366

The currency of mainland China is the Renminbi (the “RMB”), which is subject to foreign exchange control and is currently not freely convertible into foreign exchange. SAFE is the regulatory authority which administers all matters relating to the foreign exchange regime.

SAFE-approved banks are authorised to buy and sell foreign exchange from/to their customers, including buying and selling RMB against hard currencies, such as the US dollar, Euro, Japanese yen and Hong Kong dollar.

They include both mainland Chinese and foreign banks. Anyone in mainland China who requires RMB-forex conversion services, including
FIEs, representative offices and foreign expatriates, must use one of these SAFEapproved banks.Since the establishment of the RMB trade
settlement pilot scheme in 2009, which allowed cross-border settlement in RMB for the first time, there have been significant developments in the “internationalisation” of the RMB, now globally ranked as the
second-most used currency in trade finance.

An FIE is now able to pay RMB dividends outside of mainland China to its foreign shareholders and foreign investors can now make capital contributions to FIEs in mainland China using offshore RMB.

If you want know more information about foreign investment, please contact us. phone number:18948304248.

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