Related stories

Implementation Measures of the "Rules of the People's Republic of China on Customs Protection of Intellectual Property Rights" Order No. 31 of the State Administration of Radio, Film, and Television (SARFT) - Provisions of Administration on Sino-Foreign Joint Films Production (the Provisions) Measures on the Administration of Foreign Investment in Leasing Business Decision on Amendments to the Law of Judges of the People's Republic of China Regulations on Administration of Insurance Companies

Measures on Administration of Connected Transactions Between Commercial Banks and Interior Personnel and Shareholders

Bank Transactions 商业银行与内部人和股东关联交易管理办法

Measures on Administration of Connected Transactions Between Commercial Banks and Interior Personnel and Shareholders

Issued: April 2, 2004 Effective: May 1, 2004 Issuing Authority: China Banking Regulatory Commission (CBRC)

Main Contents:  These measures apply to Chinese commercial banks, wholly foreign-owned commercial banks, and Sino-foreign joint equity commercial banks, and shall be referred to for connected transactions of branches of foreign banks, agricultural cooperative banks, and urban credit cooperatives. 

According to these measures, "related parties" refers to related natural persons, legal persons or other entities, and "connected transactions covers matters with respect to the transfer of resources or obligations between commercial banks and related parties, including, but not limited to, credit extensions, assets transfers, service provisions and other connected transactions stipulated by the CBRC.     

The terms for connected contractions of commercial banks shall be no more favourable than the conditions for transactions of the same kind carried out by non-related parties, and commercial banks should establish administration rules and a connected transaction control commission responsible for supervision and administration on connected transactions.

In addition, the measures provide different approval procedures for common connected transactions and significant connected transactions; prohibit or restrict certain kinds of connected transactions of commercial banks; and specify the proportion of the balance of credit that may be granted to related parties of a commercial bank to the net capital of such bank.

Prepared from Coudert Brothers China Newsletter. For more information, please send your e-mail to cbchinanews@coudert.com