China Promulgates Regulations on Trust Investment CompaniesThe People's Bank of China (PBOC) promulgated a procedures on the administration of trust investment companies in a bid to step up its supervision and regulate these companies' operational practices.According to the procedures, trust investment companies are financial institutions mainly engaged in trust businesses. All trust investment companies must be licensed by the PBOC. Trust investment companies are allowed to operate in capital trust business; trust businesses in movables, immovables and other properties; legal trust fund businesses; and intermediate businesses. The procedures stipulated that trust investment companies are forbidden to do savings businesses, nor are they allowed to issue bonds or borrow capital from overseas. Existing trust investment companies will be rectified according to related regulations, and those allowed to remain will need to re-register with the PBOC. The procedures has 72 articles in eight chapters, making stipulations on the establishment, changes and closure, business scope, operating rules, supervision and self discipline of trust investment companies, as well as the standardization of their original businesses. |
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