The China State Administration of Foreign Exchange (SAFE) and the China Securities Regulatory Commission (CSRC) issued a joint circular Friday to further clarify the basic principles and specific policies governing the administration of foreign exchange raised from overseas listings.
A spokesman for the SAFE said that this move aims to further standardize foreign exchange payment activities related to overseas listings, and to improve the administration of foreign exchange capital generated by overseas listings.
In 1994 and 1997, the SAFE and the CSRC promulgated related regulations on the administration of foreign exchange from overseas listings, but they regulated only the transference of IPO capital from overseas, the opening of foreign exchange accounts and the use of foreign exchange.
However, since foreign exchange payment activities related to overseas listings have become increasingly diversified and complex in the past few years, regulations and practices in this area should be further standardized, the spokesman said.
The circular addresses the following issues: the establishment of a foreign exchange registering system for overseas listed stocks; the standardization of the administration of foreign exchange capital raised from overseas markets; the clarification of the management of foreign exchange proceeds from the sale of shares or assets overseas; the clarification of foreign exchange investment in overseas-listed companies; and the standardization of buy-back activities by overseas listed companies.
The spokesman said the circular provides a clear legal basis for foreign exchange payment activities related to overseas listings, which will help promote the standardization of overseas listings.
It will also help supervision departments to monitor the flow of foreign exchange capital more effectively.
(Xinhua News Agency August 23, 2002)
