SAFE Simplifies Procedures for Foreign Debt Registration
2013-June-3 Source: Newsgd.com
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On April 28, 2013, State Administration of Foreign Exchange (“SAFE”) issued Administrative Measures on Foreign Debt Registration (“Measures”) which took effect from May 13, 2013. The Measures revoke the approval procedures for some kinds of foreign debt and make the procedures of foreign debt registration simpler.

The Measures specify that upon completing the registration of the signing of contract for foreign debts, the debtor may open bank account, settle foreign exchange and repay the loan and interest at the designated bank without approval of SAFE. The funds of foreign debts borrowed by foreign-invested enterprises may be used for settlement of foreign exchange. Unless otherwise provided, the funds of foreign debts borrowed by domestic financial institutions and Chinese-funded enterprises may not be used for settlement of foreign exchange.

In addition, when borrowing from domestic financial institutions, debts meeting the requirement may accept the guarantees provided by overseas institutions or individuals. Where foreign-invested enterprises accept overseas guarantee when dealing with the domestic borrowing, they may directly conclude the guarantee contract with the overseas guarantor and creditor. In case of any performance of overseas guarantee, the guarantee performance amount shall be included into the foreign debts scale administration for foreign-invested enterprises.

(This information is provided by Lawyer Kelly Xie from Guangdong KaiTong Law Firm in friendship. It is not any legal opinion or legal grounds addressed to any organization or individual. For inquiry, please contact Kelly via email at Kelly_xie@ktlf.com.cn or by phone on 13926185641.)

Editor: Olivia
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