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Article 1. With a view to promoting the development of securities investment funds (hereinafter refers to SIFs), regulating the raising and operation of monetary market funds and other related activities, and protecting the legitimate rights and interests of the investors and other related parties, the present Provisions are formulated in accordance with the Securities Investment Funds Law, the Measures Governing the Operations of the Securities Investment Funds, the Provisions Governing the Fund Management Companies' Entry into the Inter-bank Market and other pertinent provisions. Article 2. The term "monetary market funds" mentioned in the present Provisions refers to the funds merely invested into the monetary market instruments. Where the name of a fund contains "money", "cash", "flowing", "ready money", "short-term bond" or other similar words, such fund shall meet the relevant requirements of the present Provisions. Article 3. A monetary market fund shall be invested into the following financial instruments: (1) Cash; (2) Fixed-term bank deposits and lump sum deposit slips of one year or less; (3) Bonds with a residual maturity of 397 days or less; (4) Repurchases of bonds with a residual maturity of 1 year or less; (5) Central bank bills of 1 year or less; (6) Other monetary market instruments with good liquidity acknowledged by the China Securities Regulatory Commission (CSRC) and the People's Bank of China (PBC). Article 4. No monetary market fund may be invested in the following financial instruments: (1) Stocks; (2) Convertible bonds; (3) Bonds with a residual maturity of more than 397 days; (4) Enterprise bonds with a credit rating below AAA; (5) Other financial instruments prohibited by the CSRC and the PBC. Article 5. The investment combination of a monetary market fund shall satisfy the following requirements: (1) The ratio of the investments in the short-term enterprise bond issued by the same company shall not exceed 10% of the net value of the assets of the fund; (2) The deposits in the same commercial bank with the fund custodian qualifications shall not exceed 30% of the net value of the assets of the fund; deposits in the same commercial bank without the fund custodian qualifications shall not exceed 5% of the net value of the assets of the fund; (3) The balance of the repurchase of bonds from the national inter-bank bond market shall not exceed 40% of the net value of the assets of the fund; and (4) Other ratio limits provided by the CSRC and the PBC. Article 6. The average residual maturity of the investment combination of a monetary market fund shall not exceed 180 days. Article 7. Excluding the circumstances listed below, the residual maturity of a bond in the investment combination of a monetary market fund refers to the residual days from the computation date to the maturity date of the bond: (1) As to a bond with changeable interest rate or floating interest rate based on the market interest rates, if the interest adjustment frequency is less than 1 year, the residual maturity is equivalent to the remaining period from the computation date to the next interest adjustment date; (2) The residual maturity of a repurchase agreement is equivalent to the remaining period from the computation date to the date for dealing of the basic bonds stipulated in the said agreement; (3) Other circumstances otherwise provided by the CBRC. Article 8. The monetary market fund shall disclose the average residual maturity of the investment combination of SIF in the part of investment combination of its annual report, semi-annual report and quarterly report. Article 9. As to a monetary market fund for which a price is offered every day on the basis of par value, in the fund contract it may be stipulated that the distribution of yields shall be conducted by way of re-investment of bonuses, and the distribution of yields shall be done each day. Article 10. With regard to a monetary market fund for which no purchase or redemption fee is charged, not more than 0.25% of the fund shall be drawn from the assets thereof as exclusive provision for serving the sellers and holders of this fund. The annual report of the fund shall make a special explanation about the expenses under this provision. Article 11. A fund management company shall clearly state in its prospectuses and publicity materials that an investor's purchasing monetary market fund doesn't mean the same as depositing money into the bank or financial institution that accepts deposits, and that it can't guarantee that the fund will make profits, nor does it guarantee the minimum yields thereof. Article 12. A monetary market fund shall adopt stable and proper accounting and estimation approaches so as to ensure that the net value of the assets of the fund can fairly reflect the value of the fund. The accounting approach shall be stipulated in the fund contract, and its prospective consequences to the fluctuation of the net value of the fund shall be disclosed in the prospectuses. Where the fund estimation approach mentioned in the preceding paragraph can't fairly reflect the value of the fund under a special circumstance, the monetary market fund may adopt another estimation approach. Such special circumstance and the latter estimation approach shall be stipulated in the fund contract. The occurrence of the circumstance mentioned in the preceding paragraph shall be disclosed through the financial accounting statement in the annual report or semi-annual report of the monetary market fund. Article 13. The raising, purchase, redemption, investment, information disclosure and publicity of a monetary market fund shall not only comply with the present Provisions, but also the Securities Investment Fund Law, the Measures Governing the Sale of Securities Investment Funds, the Measures Governing the Information Disclosure of Securities Investment Funds, the Provisions Governing the Fund Management Companies' Entry into the Inter-bank Market and other pertinent provisions. Article 14. The dealings and settlements of a monetary market fund in the national inter-bank market shall comply with the provisions governing the national inter-bank market and shall be subject to the supervision and dynamic inspection of the PBC. Article 15. The power to interpret the present Provisions shall remain with the China Securities Regulatory Commission and the People's Bank of China. Article 16. The present Provisions shall come into effect as of the promulgation date. |
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