State Administration of Foreign Exchange, Circular on Issues Relevant to Further Improving the Administration of Trade-related Receipt and Settlement of Foreign Exchange

Issued: September 29 2006
Effective: November 1 2006
Applicability: This Circular does not apply to bonded zones, bonded ports, export processing zones, bonded logistics parks and enterprises in bonded logistics centres (Article 12). In the case of a conflict between existing provisions and this Circular, this Circular shall prevail (Article 13).

Main contents: The State Administration of Foreign Exchange and its branches and offices (SAFE Bureaux) shall carry out annual evaluations of work units receiving foreign exchange. Work units receiving foreign exchange will be listed under "enterprises requiring attention" on foreign exchange settlement under one of the following conditions:
(1) the difference between trade-related receipt of foreign exchange and total trade-related foreign exchange receivables of the year in question is 10% or above;
(2) it is penalized by a SAFE Bureau due to a violation of the foreign exchange control provisions during the year in question; or
(3) it is determined by a SAFE Bureau to be included in the list of "enterprises requiring attention" according to their credit records, time limit for commencement of business and others.

  Work units receiving foreign exchange not included in the list of "enterprises requiring attention" shall directly handle the receipt and settlement of foreign exchange in accordance with the relevant provisions. For work units receiving foreign exchange and that are included in the list of "enterprises requiring attention", settlement of foreign exchange for all the current account-related income shall, in accordance with the Circular, be handled subsequent to strict examination (Article 4).
Related legislation: Implementing Rules for the Measures for the Administration of Reconciling Foreign Exchange Received from Exports, Jun 22 1998, CLP 1998 No.8 p.9