China customs and trade

Feb 2017

New developments in Forex Administration for trade in goods - Huifa [2017] No.3

 

On January 26, 2017, the State Administration of Foreign Exchange (SAFE) issued the "Circular on Further Advancing the Reform of Foreign Exchange Administration and Improving Examination of Authenticity and Compliance" ("Huifa [2017] No.3"). There are three main aspects regarding changes in forex administration for trade in goods as follows:

  • Allowing settlement of domestic forex loans with goods for export;
  • Enhancing examination of forex collections and payments as well as the authenticity of trading transactions; and
  • Improving management and accounting of forex income derived from the trade of goods stored overseas.

Objectives of the new circular include:

  • Facilitating short-term financing for export trade transactions; and
  • Strengthening controls and examination of forex collection and payment compliance for trade in goods

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