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In order to promote the development of the insurance market of our country, to regulate foreign exchange receipts and disbursements of the insurance market, the State Administration of Foreign Exchange and China Insurance Regulatory Commission jointly promulgated the Interim Provisions on the Administration of Foreign Exchange of the Insurance Business (hereinafter referred to Interim Provisions) a few days ago. The Interim Provisions shall be formally implemented as of November 1, 2002. In order to carry out the Interim Provisions, the State Administration of Foreign Exchange decided to make a countrywide clear-up on the foreign exchange business of the insurance operational institutions (including sino-funded, and foreign funded insurance operational institutions). It is hereby to notify the concrete matters as follows: I. METHODS Each branch of the State Administration of Foreign Exchange shall be in charge of clearing up the foreign exchange business of the branches of insurance companies (including foreign insurance companies' branches in China) within its jurisdiction. The head office of each legal-person insurance company shall uniformly organize the work. The work shall be done in two steps. First, the insurance operational institutions shall self-inspect their qualifications for engaging in foreign exchange business, foreign exchange accounts, foreign exchange receipts and disbursements, according to the pertinent requirements provided in the Interim Provisions. Second, the branches of the State Administration of Foreign Exchange shall check the self-inspection made by the insurance institutions about their foreign exchange business. Each branch shall submit a report to the State Administration of Foreign Exchange after the completion of clear-up. II. CONTENT OF CLEAR-UP (1) To check the insurance institutions' qualifications for engaging in foreign exchange business The insurance institutions shall faithfully report and fill in the Examination and Approval Statistical Statement for Insurance Institutions' Foreign Exchange Business (see Attachment 1). The branches of the SAFE shall check the relevant documents or licenses by which the insurance institutions are ratified to engage in the foreign exchange business, shall collect their operational information and report to the SAFE. (2) To check the foreign exchange accounts of the insurance institutions engaged in foreign exchange and their foreign exchange receipts and disbursements The insurance institutions shall faithfully report and fill in the Statistical Statement for Insurance Institutions' Foreign Exchange Accounts (see Attachment 2). At the same time, the commercial banks shall be required to report the information concerning the foreign exchange accounts of the insurance institutions by reference to the format of Attachment. Each branch of the SAFE shall check the information reported by the insurance institutions and the banks, and shall report the collected information to the SAFE. In addition, the commercial banks are required to report the information concerning the opening and use of foreign exchange accounts by the intermediary insurance institutions to the local branches of the SAFE, which shall report the collected information to the SAFE. 3. To check the premium in foreign currencies charged by the insurance institutions or compensations in foreign currencies The insurance institutions shall clear-up the foreign exchange insurance contracts that were signed before November 1, 2002 and are being implemented. Those inconsistent with the requirements provided in the Interim Provisions shall be filled in the Statistical Statement for the Insurance Institutions' Foreign Exchange Insurances (see Attachment 3) and shall be reported to the local branches of the SAFE, which shall collected information to the SAFE. The braches of foreign insurance companies within China shall faithfully report and fill in the Insurance Companies' Operations of Foreign Exchange (see Attachment 4) according to their operational status during the period from 2000 to 2002 to the local branches of the SAFA, which shall report the collected information to the SAFE. 4. To establish an information database of the basic operational information of foreign exchange of the local insurance institutions On the basis of this clear-up work, the branches of SAFE shall establish a database of the basic operational information of foreign exchange of the local insurance institutions according to Attachments 1 ¨C 4, and shall update and add the relevant information to the information database in time according to the operational changes in foreign exchange insurance institutions. III. THE POLICIES TO BE FOLLOWED IN THE CLEAR-UP WORK This clear-up work is to find out the status quo of the insurance institutions engaged in foreign exchange and regulate the management of the market access, the opening and use of foreign exchange accounts, and foreign exchange receipts and disbursements. Its main task is to collect information, know the business, and publicize administrative policies and to lay a good foundation for the future administration of insurance foreign exchange. Thus the branches of SAFE shall execute the following policies in the clear-up: (1) For an insurance institution that has a License for Operation of Foreign Exchange Business issued by the SAFE or a License for Legal-person Financial Institutions issued by the People's Bank of China, however, the 3-year-period of validity of the License expires, the insurance institution are required to apply for a new License for Operation of Foreign Exchange Business in accordance with the relevant requirements of the Interim Provisions. The foreign insurance contracts entered into before November 1, 2002 shall be continue to be executed, but the terms may not be extended when they expire. The foreign insurance contracts entered into after November 1, 2002 shall be in consistence with the relevant requirements of Interim Provisions. The old foreign exchange accounts remain in use. The scope of receipts and disbursements in the old foreign exchange accounts and the new ones shall be uniformly implemented in accordance with the Interim Provisions. (2) As to an operational insurance institution without applying for the License for Operation of Foreign Exchange Business itself, but its superior company has the License, it is required to apply for the qualifications for the operation of foreign exchange. The foreign exchange insurance contracts concluded thereby before November 1, 2002 shall continue to be executed, but the terms may not be extended when they expire. It shall not sign new foreign exchange insurance contract until it has obtained the License for Operation of Foreign Exchange Business. The old foreign exchange accounts may remain in use. The scope of receipts and disbursements shall uniformly implemented in accordance with the Interim Provisions, but no new foreign exchange account may be opened until it has obtained the License for Operation of Foreign Exchange Business. (3) Where an insurance institution fails to apply for the License for Operation of Foreign Exchange Business, so does its superior company, the foreign exchange insurance contracts concluded thereby before November 1, 2002 shall continue to be executed, but the terms may not be extended when they expire. It shall not sign new foreign exchange insurance contract until it has obtained the License for Operation of Foreign Exchange Business. The foreign exchange receipts and disbursements occurred in the foreign exchange accounts under the insurance shall be under the foreign exchange insurance contracts entered into before November 1, 2002. After the complete fulfillment of the pertinent foreign exchange insurance contracts, if the insurance institution fails to obtain the License for Operation of Foreign Exchange Business, the foreign exchange accounts shall be cancelled after the settlement of exchange under supervision. (4) As for an operational insurance institution with a valid License for Operation of Foreign Exchange Business, the foreign insurance contracts concluded thereby before November 1, 2002 shall continue to be executed, but those inconsistent to the pertinent requirements of the Interim Provisions may not be extended. The foreign insurance contracts established after November 1, 2002 shall be in consistence with the Interim Provisions. The old foreign exchange accounts may continue to be used, or the scope for receipts and disbursements in the old foreign exchange accounts or newly opened ones shall be uniformly implemented in accordance with the Interim Provisions. IV. THE TIME REQUIREMENTS FOR THE CLEAR-UP The clear-up work shall be from November 1, 2002 to January 31, 2003. Each branch of the SAFE itself may decide the deadline for the self-inspection of the operational insurance institution within its jurisdiction, but shall require them to finish the self-inspection by the end of 2002. After having completed the clear-up work before January 31, 2003, all branches of SAFE shall formally report the clear-up work of foreign exchange business of the insurance institutions within their respective jurisdiction and submit pertinent statements to the SAFE before February 28, 2003. Having received this notice, all branches shall distribute it to the insurance operational institutions within their respective jurisdiction in time and make arrangements for the clear-up. In the clear-up, all branches shall carefully check self-inspection of the local insurance institutions, the qualifications for operation of foreign exchange of insurance institutions and the opening and use of foreign exchange accounts, shall complete the clear-up work and report work in strict conformity with the scheduled time. If any difficulty occurs in the clear-up, please report it to the Administrative Department of Current Items of SAFE in time. (Fax: 010-68402272). Attachments: 1. Examination and Approval Statistical Statement for Insurance Institutions' Foreign Exchange Business (Omitted) 2. Statistical Statement for Insurance Institutions' Foreign Exchange Accounts (Omitted) 3. Statistical Statement for the Insurance Institutions' Foreign Exchange Insurances (Omitted) 4. Insurance Companies' Operations of Foreign Exchange (Omitted) |
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