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TABLE OF CONTENTS CHAPTER I GENERAL PROVISIONS CHAPTER II SUBSTANCE OF AND STANDARDS FOR REPORTING LARGE-VALUE AND SUSPICIOUS FOREIGN EXCHANGE TRANSACTIONS CHAPTER III PROCEDURES FOR FINANCIAL INSTITUTIONS' REPORT OF LARGE-VALUE AND SUSPICIOUS FOREIGN EXCHANGE TRANSACTIONS CHAPTER IV THE ITEMIZATION, SCREENING, IDENTIFICATION, ANALYSIS, INVESTIGATION, VERIFICATION AND TREATMENT BY THE AFE OF LARGE-VALUE AND SUSPICIOUS FOREIGN EXCHANGE TRANSACTIONS CHAPTER V LEGAL RESPONSIBILITY CHAPTER VI SUPPLEMENTARY PROVISIONS CHAPTER I GENERAL PROVISIONS Article 1. These Rules are formulated in accordance with the Law of the People's Republic of China on the People's Bank of China, the Provisions Concerning the Anti-money Laundering Practices by Financial Institutions and the Measures for the Administration of Financial Institutions' Report of Large-value and Suspicious Foreign Exchange Transactions (hereinafter referred to the "Measures") for the purpose of standardizing the reporting by financial institutions of large-value and suspicious foreign exchange transactions, making better-defined the laws and regulations on anti-money laundering in the foreign exchange sector. Article 2. The SAFE and its branch and sub-branch offices (hereinafter referred to the "AFE") shall be responsible for the inspection, supervision and administration of the implementation by financial institutions of the Measures, itemize, examine and analyze information of large-value and suspicious foreign exchange transactions reported by financial institutions, follow the tracks of and verify the information of suspicious foreign exchange transactions, make investigations and punishments with regard to violations of any provisions concerning foreign exchange control, hand over the information of and clues to any suspected money laundering or any other crime to the authority for public security or other law enforcement organs, and keep watch over and crack down on money laundering and other illegal activities in cooperation with other supervisory, law enforcement and judicial organs. Article 3. Each financial institution shall strictly abide by the provisions concerning anti-money laundering and conscientiously perform its duty of anti-money laundering. Each financial institution shall establish and improve an internal anti-money laundering control system, set up a special operating department for anti-money laundering or designate an existing department to be responsible for the anti-money laundering work with appointment of a special person taking the charge. Each financial institution shall stick to the principle of "having good knowledge of your customers", abide by the relevant provisions on using the real name for opening an individual deposit account and, when developing business relations with its customers and handling the foreign exchange business, get a good grasp of its customers' identities and daily operation conditions and other credit standing, and identify its customers. Each financial institution shall identify and verify large-value and suspicious foreign exchange transactions and promptly report the same to the AFE. Each financial institution shall keep for at least five years the records made in the anti-money laundering practices. Each financial institution shall observe the security system and may not disclose to any entity or individual any information of large-value or suspicious foreign exchange transactions or of any of its customers being enquired, verified or investigated, unless otherwise provided for by the state. Each financial institution shall assist and cooperate with the AFE, other supervisory, law enforcement and judicial organs in anti-money laundering practices. CHAPTER II SUBSTANCE OF AND STANDARDS FOR REPORTING LARGE-VALUE AND SUSPICIOUS FOREIGN EXCHANGE TRANSACTIONS Article 4. Each financial institution shall report the foreign exchange transactions under Article 8 of the Measures in both paper and electronic forms on a monthly basis. Each financial institution shall report the foreign exchange transactions under Article 9, Articles 10 (1), (2), (3), (4), (5), (6), (7), (8), (9), (10), (11), (12), (19) and (20), Article 12 (3) and Articles 13 (3), (8), (9) and (23) of the Measures in both paper and electronic forms on a monthly basis. Article 5. Each financial institution shall promptly report the foreign exchange transactions under Articles 10 (13), (14), (15), 16), (17) and (18), Articles 12 (1) and (2) and Articles 13 (1), (2), (4), (5), (6), (7), (10), (11), (12), (13), (14), (15), (16), (17), (18), (19), (20), (21), (22) and (24) of the Measures in paper form. Article 6. Large-value and suspicious foreign exchange transactions made through an account (or bankcard) opened with a domestic financial institution shall be reported by the opening (issuing) bank; large-value and suspicious foreign exchange transactions made through a bankcard issued abroad shall be submitted by the acquiring bank; large-value and suspicious foreign exchange transactions made in any way other than through a account (or bankcard) shall be reported by the handling bank. Article 7. For the purpose of reporting large-value and suspicious foreign exchange transactions, an accumulated amount of transactions referred to in the Measures shall be calculated unilaterally based on the receipt or payment of funds. For the purpose of reporting large-value and suspicious foreign exchange transactions, in the case of fund movements between foreign exchange accounts, the standards for non-cash transactions shall apply and, in the case of deposit or withdrawal of foreign exchange cash in or from an account or any other cash transactions, the standards for cash transactions shall apply. Article 8. A large-value foreign exchange cash transaction referred to in Article 8 of the Measures means: (1) any single or multiple foreign exchange cash transactions made in a day by an enterprise or individual with an amount or an accumulated amount of value at or above the equivalent of US$10,000; (2) any single or multiple non-cash foreign exchange transactions made in a day by an individual with an amount or an accumulated amount of value at or above the equivalent of US$100,000; or (3) any single or multiple non-cash foreign exchange transactions made in a day by an enterprise with an amount or an accumulated amount of value at or above the equivalent of US$500,000; For the large-value foreign exchange transaction under any of the following circumstances it is not required to report: (1) upon the maturity of a time deposit, the principal or the principal together with all or part of the interest thereon is not directly withdrawn or transferred but re-deposited in an account opened by the same customer under the same name with the same financial institution; (2) the principal or the principal together with all or part of the interest thereon in a current account is transferred to a time deposit in an account opened by the same customer under the same name with the same financial institution; (3) the principal or the principal together with all or part of the interest thereon of a time deposit is transferred to a current account opened by the same customer under the same name with the same financial institution; (4) any large-value conversion from one to another currency during an foreign exchange transaction by an individual with a firm offer; (5) any large-value foreign exchange transaction by any of the Party organs or state organs (including the state organs of power, administrative, judicial and military organs) at various levels, the Chinese People's Liberation Army or Armed Police Force, or the National Committee of the CPPCC or CPPCC local committees, not including any enterprise or institution subordinate to any of them; (6) any large-value foreign exchange transaction under a re-loaning of the loan from any international financial organization or foreign government; (7) any large-value debt swap transaction under a loan from any international financial organization or foreign government; (8) other large-value foreign exchange transactions provided by the SAFE. Article 9. "In a large amount" referred to in Articles 9, 10, 12 and 13 of the Measures means a single or multiple foreign exchange transactions with an amount or an accumulated amount of value not less than: (1) the equivalent of $8,000, in the case of foreign exchange cash transactions; (2) the equivalent of $80,000, in the case of non-cash foreign exchange transactions by an individual; (3) the equivalent of $480,000, in the case of non-cash foreign exchange transactions by an enterprise. Article 10. "Mostly" referred to in Articles 9 (9) and (10) of the Measures means being at least 50%. Article 11. "Large amounts of Renminbi cash" referred to in Article 12 (3) of the Measures means Renminbi cash in an amount of at least 20,000 yuan. Article 12. "The annual repatriation of profit by an enterprise with foreign investment exceeding the amount of investment by a large margin or obviously not in keeping with its business operation" referred to in Article 10 (15) of the Measures means the case where the annual accumulated repatriation of profit by the foreign party of an enterprise with foreign investment exceeding the amount of investment already made by at least 50% or obviously not in line with its business operation. Article 13. "Offsetting deposit or loan transaction with any affiliate or associated company of a financial institution located in a region with serious problems of smuggling, narcotics trafficking or terrorist activities" referred to in Article 10 (17) of the Measures means any offsetting deposit or loan transaction between any financial institution, enterprise or individual and any affiliate or associated company of a financial institution located in a region with serious problems of smuggling, narcotics trafficking or terrorist activities. Article 14. "Payment from a foreign exchange account in an amount roughly tallying with the amount of deposit made on the same or previous day" referred to in Article 12 (1) of the Measures means the amount withdrawn, settled, remitted or transferred from a foreign exchange account roughly tallying with the amount of cash deposit made on the same or previous day. Article 15. "Any account holder depositing foreign exchange or Renminbi cash in many transactions in foreign currency savings accounts of others and receiving at the same time Renminbi or foreign exchange of the equivalent amount" referred to in Article 12 (2) of the Measures means the case where the savings or balance accounts of both of the transacting parties respectively have a foreign exchange and Renminbi receipt, that is, when a party deposits foreign exchange in the savings or balance account of another person, he receives Renminbi in the equivalent amount through his savings or balance account, and vice versa. Article 16. "Any enterprise group making any internal foreign exchange fund transfer exceeding the volume of its actual business operation" referred to in Article 13 (5) of the Measures means any foreign exchange transaction between enterprises or associated companies within an enterprise group that is not commensurate with the actual demand of business. Article 17. "Any enterprise knowingly conducting loss-making sale or purchase of foreign exchange" referred to in Article 13 (15) of the Measures means the case where an enterprise knows that the existing condition is unfavorable to the transaction to be made but still makes purchase or sale of foreign exchange without reasonable grounds. Article 18. "Any other foreign exchange transactions being suspected on reasonable grounds by the staff of the bank or other financial institution as money laundering" referred to in Article 13 (24) of the Measures means any cash or non-cash foreign exchange transaction discovered and inferred to be likely connected with any money laundering activities or other crimes of the like, by a staff member of a financial institution with due care and prudence in identifying the transaction and customer when handling the financial business. CHAPTER III PROCEDURES FOR FINANCIAL INSTITUTIONS' REPORT OF LARGE-VALUE AND SUSPICIOUS FOREIGN EXCHANGE TRANSACTIONS Article 19. For reporting large-value and suspicious foreign exchange transactions, financial institutions shall accurately fill out the report forms in accordance with the format specified by SAFE, and proofread and verify such report forms before submitting them. Article 20. For reporting the large-value foreign exchange transactions mentioned in the first paragraph of Article 4 of the present Rules, financial institutions shall fill out and submit a "Monthly Report Form of Large-Value Foreign Exchange Transactions by Enterprises" (hereinafter referred to the "Form I") or a "Monthly Report Form of Large-Value Foreign Exchange Transactions by Resident and Non-resident Individuals" (hereinafter referred to the "Form II"). For reporting the suspicious foreign exchange transactions under the second paragraph of Article 4 of the present Rules, financial institutions shall fill out and submit a "Monthly Report Form of Suspicious Foreign Exchange Transactions" (hereinafter referred to the "Form III") on the monthly basis. For reporting the suspicious foreign exchange transactions under Article 5 of the present Rules, financial institutions shall promptly fill out and submit a "Report Form of Suspicious Foreign Exchange Transactions Identified by Financial Institutions" (hereinafter referred to the "Form IV") or a (Report) Form for the Handing-over of Cases of (Clues to) Suspected Money Laundering Activities in the Foreign Exchange Sector (please refer to Annex 1) with the relevant materials attached. Article 21. Each branch office of financial institutions shall, within the first five working days of each month, itemize the information of large-value and suspicious foreign exchange transactions that took place in the preceding month by filling out Forms I, II and III, submit such Forms through its superior office to the principal reporting unit, and to the local AFE in both paper and electronic forms. The head office of each financial institution shall, within the first five working days of each month, itemize the information of large-value and suspicious foreign exchange transactions that took place within the head office in the preceding month by filling out Forms I, II and III and submit such Forms to the local AFE in both paper and electronic forms. Article 22. Each principal reporting unit shall, within the first 15 days of each month, itemize the information of large-value and suspicious foreign exchange transactions that took place in the head office in the preceding month by filling out Forms I, II and III and submit such Forms in both paper and electronic forms to its head office and to the SAFE branch or department of foreign exchange control of the province, autonomous region or municipality directly under the Central Government where it is located. Article 23. The head office of each financial institution shall, within the first 20 days of each month, itemize the information of large-value and suspicious foreign exchange transactions that took place within its jurisdiction in the preceding month by filling out Forms I, II and III and submit such Forms to the SAFE in electronic form. Article 24. Each financial institution shall examine the suspicious foreign exchange transactions under Article 5 of the present Rules and, in the case of discovery of any suspected money laundering activities, fill out Form IV and submit it to the local AFE with the relevant materials attached within three working days from the discovery. Article 25. Any financial institution that discovers a crime of (clue to) suspected money laundering shall, within three working days from the discovery, fill out a (Report) Form for the Handing-over of Cases of (Clues to) Suspected Money Laundering Activities in the Foreign Exchange Sector and hand it over to the authority for public security with the relevant materials attached, and submit a copy of the Form to the local AFE. Article 26. Financial institutions may computerize the collection of data of large-value foreign exchange transactions and suspicious foreign exchange transactions that can be quantitatively described, which are required to be reported, provided that: (1) the integrity, standardization and reality of the information be ensured; (2) the data originate from the accounting data and other key business data in the original database of the financial institution; and (3) the quantification indicator and interface specification issued by the SAFE be observed. CHAPTER IV THE ITEMIZATION, SCREENING, IDENTIFICATION, ANALYSIS, INVESTIGATION, VERIFICATION AND TREATMENT BY THE AFE OF LARGE-VALUE AND SUSPICIOUS FOREIGN EXCHANGE TRANSACTIONS Article 27. The AFE shall, in accordance with the specified procedure, appraise the standardization of the report forms submitted by financial institutions, and order the financial institution concerned to promptly fill out and submit another proper report form, if any report form fails to meet the requirement for standardization. The SAFE branch or department of foreign exchange control of each province, autonomous region or municipality directly under the Central Government shall respectively itemize Forms I, II and III that meet the requirement for standardization and submit the itemized materials to the SAFE no later than the 20th day of each month. After receiving Forms IV and (Report) Forms for the Handing-over of Cases of (Clues to) Suspected Money Laundering Activities in the Foreign Exchange Sector submitted by financial institutions, each SAFE sub-branch shall submit the same through its superior office to the SAFE's branch or department of foreign exchange control of the province, autonomous region or municipality directly under the Central Government, which shall make a prompt itemization and submit the itemized materials to the SAFE. Article 28. The AFE shall promptly input into its database and itemize, screen, identify, analyze and verify the electronic data that meet the requirement for standardization and submit an analysis report (monthly and quarterly) to its superior office in accordance with the relevant provisions. Article 29. Where the superior office of an AFE hands over any information of suspicious foreign exchange transactions for the verification by the inferior office, the superior office shall fill out a Sheet for the Handing-over of Information of Large-value and Suspicious Foreign Exchange Transactions Involved in Case (please refer to Annex 2). The inferior office shall promptly make such verification and report the verification result and treatment to the superior office within a specified time limit. Article 30. Where any assistance of another SAFE branch or sub-branch is required for the verification of information of foreign exchange transactions, the requesting branch or sub-branch shall fill out a Letter Requesting Assistance for the Verification of Large-value and Suspicious Foreign Exchange Transaction (please refer to Annex 3), and the requested branch or sub-branch shall promptly make such verification and notify the requesting branch or sub-branch of the result of the verification. Article 31. Where any assistance of a financial institution is required for the verification of information of foreign exchange transactions, the requesting AFE shall fill out a Notice of Out-of-spot Verification of Large-value and Suspicious Foreign Exchange Transactions (please refer to Annex 4). The requested financial institution shall provide such assistance requested and notify the requesting AFE of the verification result. Article 32. The AFE that discovers any suspected crime of (clue to) money laundering shall hand over the case or clue to the authority for public security in accordance with the Provisions Concerning the Cooperation Between the Ministry of Public Security and the State Administration of Foreign Exchange in Anti-money Laundering Practices in the Foreign Exchange Sector; the AFE that discovers any other suspected offence (clue) shall hand the case (clue) over to the relevant law enforcement organ in accordance with the Operating Rules for Handing over Cases. Article 33. The AFE shall severely deal with suspected violations of the provisions concerning foreign exchange control discovered during the verification. The SAFE branch or department of foreign exchange control of each province, autonomous region or municipality directly under the Central Government shall, on a monthly basis, submit to the SAFE a report on the following work conducted by itself and AFEs subordinate to it by making use of the reported information of large-value and suspicious foreign exchange transactions: (1) discovering clues to suspected crimes and handing over the cases to the authority for public security; (2) providing assistance to the judicial and other law enforcement organs; (3) discovering and dealing with suspected violations of the provisions concerning the foreign exchange control. CHAPTER V LEGAL RESPONSIBILITY Article 34 Any financial institution that fails to report any large-value or suspicious foreign exchange transaction or fails to do so in a timely manner shall be given a warning and a fine of 50,000 up to 300,000 yuan by the AFE in accordance with Article 25 of the Measures for Punishment Against Illegal Financial Activities. Article 35. Any financial institution that opens an foreign exchange account for an enterprise without examining the customer information or without requiring all of the necessary customer information in accordance with the relevant provisions shall be ordered to make corrections and cancel the foreign exchange account, condemned publicly and given a fine of 50,000 up to 300,000 yuan by the AFE in accordance with Article 47 of the Regulations of the People's Republic of China on Foreign Exchange Control. Article 36. Any financial institution that is involved in any of the following circumstances shall be ordered to make corrections, condemned publicly and given a fine of 50,000 up to 300,000 yuan by the AFE in accordance with Article 49 of the Regulations of the People's Republic of China on Foreign Exchange Control: (1) failure to provide assistance to the AFE by making out-of-spot verification of anti-money laundering information; (2) failure to provide assistance to the AFE by making spot verification of anti-money laundering information; (3) failure to establish an internal anti-money laundering control system in accordance with the relevant provisions; or (4) failure to be cooperative in the inspection and supervision by the AFE over the anti-laundering work. Article 37. Any financial institution that is involved in any of the following circumstances shall be ordered to get right and given a warning and may be given a fine of 10,000 up to 30,000 yuan in accordance with Article 17 of the Measures: (1) failure to report all large-value and suspicious foreign exchange transactions required by the relevant provisions; (2) failure to report accurate information of large-value and suspicious foreign exchange transactions; (3) failure to keep records of large-value and suspicious foreign exchange transactions or the relevant materials; or (4) violation of the relevant provisions by disclosing the information of any large-value and suspicious foreign exchange transactions or of any of its customers being enquired, verified or investigated. Article 38. Any financial institution that opens a foreign exchange account for any individual without examining the customer information or without requiring the all the necessary customer information in accordance with the relevant provisions shall be ordered to get right and given a warning and may be given a fine of 1,000 up to 5,000 yuan by the AFE in accordance with Article 18 of the Measures. Article 39. Any financial institution that violates any of the anti-money laundering provisions when handling foreign exchange business and causes heavy losses as a result shall be ordered by the AFE to suspend or cease part or all of its foreign exchange settlement and sales business, and the AFE may recommend any other financial supervisory authorities to order the financial institution to suspend or cease any other foreign exchange business. Article 40. Any staff member of a financial institution who violates the relevant provisions and provides assistance in money-laundering activities shall, in accordance with Article 20 of the Measures, be given a disciplinary sanction or, if a crime is constituted, be transferred to the judicial organ to be investigated for criminal responsibility. CHAPTER VI SUPPLEMENTARY PROVISIONS Article 41. "Principal reporting unit" means tier-one branches located in capitals of provinces and autonomous regions and in municipalities directly under the Central Government of a financial institution, or offices designated by a financial institution to collect, itemize and report to the SAFE branch or department of foreign exchange control of the province, autonomous region or municipality directly under the Central Government large-value and suspicious foreign exchange transactions that took place in all branch and sub-branch offices in such region. Article 42. The provisions of the Measures and these Rules concerning the reporting of large-value and suspicious foreign exchange transactions by enterprises shall apply to the reporting of large-value and suspicious foreign exchange transactions by any other domestic institution, such as a state organ, social organization or army unit, any overseas institution that opens an account with a domestic financial institution and makes exchange, receives and pays foreign exchange through such account, and any overseas institution that handles foreign exchange business through a domestic financial institution without having an account therewith. Article 43. The power to interpret these Rules shall be vested in the SAFE. Article 44. These Rules shall come into force as of the date of promulgation. Annex: omitted. |
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