Notice on Matters Concerning Deepening the Reform of Foreign Exchange Administration for Cross-Border Investment and Financing

To all local branches of the State Administration of Foreign Exchange (SAFE) in all provinces, autonomous regions, municipalities directly under the Central Government, and cities specifically designated in the state plan; and all nationwide Chinese-funded banks:

For the purpose of thoroughly implementing the spirit of the Third Plenary Session of the 20th Central Committee of the Communist Party of China, fulfilling the decisions and arrangements of the Party Central Committee and the State Council, expanding high-standard opening-up, and serving the high-quality economic development, the State Administration of Foreign Exchange decides to deepen the reform of foreign exchange administration for cross-border investment and financing and further improve the facilitation of cross-border investment and financing. The relevant matters are hereby notified as follows:

I. Deepening the Reform of Foreign Exchange Administration for Cross-Border Investment
Abolishing the registration of basic information on upfront expenses for domestic direct investment. Where a foreign investor needs to remit upfront expenses prior to establishing a foreign-invested enterprise within the territory of China, it may directly open an upfront expense account at a bank and remit the upfront expense funds, without the need to complete the registration of basic information on upfront expenses before opening the account.

Abolishing the registration for domestic reinvestment by foreign-invested enterprises. On the premise of not violating the special administrative measures for foreign investment access and that the domestic invested projects are authentic and compliant, when a foreign-invested enterprise conducts domestic reinvestment with its foreign exchange registered capital and the RMB funds obtained from the settlement of such foreign exchange, the invested enterprise or the equity transferor shall not be required to complete the registration and modification registration of basic information for receiving domestic reinvestment, and the funds for domestic reinvestment may be directly transferred to the relevant accounts.

Permitting the domestic reinvestment of foreign exchange profits under foreign direct investment. Foreign exchange profits legally generated in China by foreign-invested enterprises and foreign exchange profits legally obtained by foreign investors may be used for domestic reinvestment. The relevant foreign exchange funds may be transferred into the capital account of the invested enterprise or the capital account settlement account of the equity transferor, and the use of the funds shall be handled in accordance with the management requirements of the relevant accounts.
Facilitating domestic non-enterprise scientific research institutions in receiving overseas funds. Domestic non-enterprise scientific research institutions receiving overseas funds shall go through procedures such as foreign exchange registration, account opening and fund remittance with reference to the practices for foreign direct investment. When such institutions use the received overseas foreign exchange funds and the RMB funds obtained from the settlement of such foreign exchange for domestic reinvestment, the procedures shall be handled with reference to those for domestic reinvestment under foreign direct investment. Eligible non-enterprise scientific research institutions may participate in the facilitation policy for the payment of capital account receipts.

II. Deepening the Reform of Foreign Exchange Administration for Cross-Border Financing
Expanding the facilitation of cross-border financing. Eligible high-tech enterprises, "specialized, refined, distinctive, and innovative" enterprises and technology-based small and medium-sized enterprises nationwide may borrow foreign debts with an amount not exceeding the equivalent of 10 million US dollars. Among them, eligible enterprises selected by the competent authorities based on the "innovation scoring system" may borrow foreign debts with an amount not exceeding the equivalent of 20 million US dollars.

Simplifying the registration and management requirements for facilitated cross-border financing businesses. Enterprises engaging in facilitated cross-border financing businesses shall no longer be required to provide the audited financial reports of the previous year or the latest period during the contract signing and registration stage.

III. Optimizing the Facilitation Policy for the Payment of Capital Account Receipts
Reducing the negative list for the use of capital account receipts. The use of foreign exchange receipts under the registered capital and foreign debts of non-financial enterprises as well as the RMB funds obtained from the settlement of such foreign exchange shall adhere to the principles of authenticity and self-use. Such funds shall not be directly or indirectly used for expenditures prohibited by national laws and regulations; unless otherwise explicitly stipulated, they shall not be directly or indirectly used for securities investment or other investment and financial management activities (excluding wealth management products and structured deposits with a risk rating not higher than Grade II); nor shall they be used for granting loans to non-affiliated enterprises (excluding cases explicitly permitted by the business scope).

Optimizing the facilitation business for the payment of foreign exchange capital account receipts. On the premise of balancing facilitation services and risk prevention, banks may independently determine the proportion and frequency of random post-event inspections for facilitated businesses based on factors such as the compliant operation status and risk level of their clients.
Facilitating the foreign exchange settlement and payment for overseas individuals purchasing properties in China. Where an overseas individual meets the property purchase qualification requirements stipulated by the competent real estate authorities and local governments, it may, prior to obtaining the property purchase filing certificate issued by the competent real estate authority, go through the formalities for foreign exchange settlement and payment of funds related to property purchase at a bank by virtue of the property purchase contract or agreement, and submit the property purchase filing certificate to the bank afterward. Such facilitation of foreign exchange settlement and payment for domestic property purchases shall not alter the policy on overseas individuals purchasing properties in China.

The specific operation procedures for the above-mentioned policies shall be referred to the Annex - Operational Guidelines for Facilitation Policies on Deepening the Reform of Foreign Exchange Administration for Cross-Border Investment and Financing (hereinafter referred to as the "Guidelines").

Banks shall, in accordance with the principle of prudent operation, strengthen the post-event monitoring of the above-mentioned cross-border investment and financing businesses and the facilitation businesses for the payment of capital account receipts, provide convenient and efficient cross-border fund settlement services for genuine and compliant cross-border investment and financing, and promptly report any abnormal and suspicious situations. All local branches of SAFE in provinces, autonomous regions, municipalities directly under the Central Government, and cities specifically designated in the state plan shall strengthen in-process and post-event supervision as well as inspection, and guide banks and enterprises to carry out their businesses in a compliant manner.

Where enterprises or banks fail to handle business in accordance with this Notice and the Guidelines, the State Administration of Foreign Exchange may impose penalties in accordance with the Regulations of the People's Republic of China on Foreign Exchange Administration.

This Notice shall come into force on the date of issuance. The Notice of the State Administration of Foreign Exchange on Supporting the Pilot Program of Facilitated Cross-Border Financing for High-Tech Enterprises and "Specialized, Refined, Distinctive, and Innovative" Enterprises (SAFE Circular [2022] No.16) shall be abolished simultaneously. In case of any inconsistency between previous provisions and this Notice, this Notice shall prevail. Upon receiving this Notice, all local branches shall promptly forward it to the prefectural and municipal branches under their jurisdiction, as well as to urban commercial banks, rural commercial banks, foreign-funded banks, and rural cooperative banks.

Hereby notified.

State Administration of Foreign Exchange
September 12, 2025