Revised code of conduct for banks' cross-border RMB biz released on June 15

China Foreign Exchange Market Self-Regulatory Framework (SRF) has formally released the 2021 version of code of conduct for banks' cross-border Renminbi (RMB) business on Tuesday, reported Xinhua-run Xinhua Finance citing news posted on SRF's official WeChat account Thursday.

SRF said the amended version, already discussed and approved on its seventh work conference previously held on May 27, aimed at further boosting application of related cross-border RMB business facilitation policies in China.

The revision is also deemed as a step to materialize requirements of six Chinese regulators' joint notice on further optimizing cross-border RMB business policies to stabilize foreign trade and foreign investment, according to SRF.

The new version contains eight sub-codes of conduct on good trade, service trade and other current account items, foreign direct investment, outward direct investment, overseas lending by domestic enterprises, two-way cross-border RMB fund pools, cross-border financing, and financial market and other businesses as well.

Regardless of others, the sub-code of conduct on service trade and other current account items contains seven main principles.

For instance, banks are required to effectively perform authenticity and compliance review responsibilities, strengthen review of current account items under primary supervision and regulation, respect the actual selection of currencies by clients in current account cross-border RMB purchase and sales, guard against cross-border capital flow risks aroused from speculation and arbitrage, timely monitor and treat abnormal transactions, actively implement trade and investment facilitation pilots of higher levels and support cross-border RMB settlement for new forms of businesses.

SRC is a self-regulatory and coordination mechanism composed of forex market and other related market participants to carry out, under relevant forex policies and rules in China, self-regulatory management over quoting for central parity rates of RMB exchange rates, interbank forex market transactions, and conducts of banks' over the counter (OTC) forex and cross-border RMB businesses.