Cross-border investment and financing are an important link for my country to integrate into the global value chain and a powerful driver of industrial transformation and upgrading. On January 19, the Shanghai Branch of the State Administration of Foreign Exchange issued the “Notice on Carrying out the Pilot Program for High-level Opening of Cross-border Trade and Investment” (hereinafter referred to as the “Notice”) to further expand the pilot business for high-level opening up of cross-border trade and investment with a high level of Horizontal opening up promotes high-quality development and facilitates more business entities to handle cross-border trade investment and financing business in compliance with regulations.
The Bank of Shanghai closely follows the requirements of high-level new policies, pays close attention to policy publicity and implementation, focuses on serving the real economy, identifies customers with qualified needs, and actively participates in high-level pilot open services. Recently, the Bank of Shanghai launched the first high-level new policy facilitation business – foreign-invested enterprises are exempted from registration for domestic reinvestment.
An information technology company in Shanghai is a foreign-invested enterprise mainly engaged in the development of basic artificial intelligence software. It plans to use foreign exchange capital settlement funds to acquire the equity of a digital technology company in Beijing. The equity transferor is a financial leasing company registered in Shanghai. As the company’s subsequent business operation needs are more urgent, it is urgent to complete the acquisition matter quickly.
“Foreign-invested enterprises carry out domestic reinvestment business…the invested enterprise or equity transferor is an enterprise registered within the jurisdiction of the pilot area…” “Non-investment foreign-invested enterprises carry out domestic reinvestment with RMB obtained from direct foreign exchange settlement, and involve equity Transfer transaction…” After quick analysis one by one, the characteristics of this transaction match the new policy conditions. If handled according to the new policy, the equity transferor no longer needs to go through the registration procedures for receiving domestic reinvestment, open relevant special accounts, and provide a complete set of capital items. With proof of payment, etc., investor funds can also be directly transferred to the domestic RMB account of the equity transfer institution, allowing companies to truly enjoy the dividends of cross-border investment and financing policies.
In order to help customers save maximum time and cost, Bank of Shanghai immediately strengthens customer promotion. On the basis of “understanding customers, understanding business, and due diligence”, it conducts authenticity reviews on customer qualifications, transaction authenticity, capital flow, etc., and at the same time optimizes The operation process completed the domestic reinvestment business of the foreign-invested enterprise and improved the efficiency of the enterprise’s capital use.
Since the implementation of the high-level opening policy for cross-border trade and investment, the Bank of Shanghai has promoted the implementation of a series of facilitation services to provide enterprises with more cross-border linkage financial service solutions and help enterprises flexibly allocate domestic and foreign funds. As a municipal financial state-owned enterprise, the Bank of Shanghai will continue to promote high-level opening-up foreign exchange management reforms for cross-border trade and investment, further enhance cross-border financial service capabilities, and better serve Shanghai’s implementation of the “Five Centers” construction and strengthening of the “Four Major Functions” and other major Mission accomplished.