New Regulations on Capital Management of Foreign Investors in China’s Bond Market

On November 10, 2022, People’s Bank of China (“PBOC”) and State Administration of Foreign Exchange (“SAFE”) jointly issued the Regulations on Capital Management for Foreign Institutional Investors Investing in China’s Bond Market (“Regulations”), which will come into effect on January 1, 2022.

The Regulations clarifies the capital management requirements for the foreign institutional investors investing in China’s Bond Market, such as the capital shall be subject to the registration administration of the SAFE. The China’s Bond Market in the Regulations includes China’s domestic inter-bank bond market and exchange-traded bond market. The promulgation of the Regulations is conducive to further facilitating foreign institutional investors to invest in China’s bond market, as well as enhance the attractiveness of China’s bond market to foreign institutional investors.