In order to give full play to the role of cross-border finance in supporting the high-quality development of the "Two Zones" in Beijing, the Operations Office (Beijing) of the People's Bank of China and the Beijing Foreign Exchange Management Department of the State Administration of Foreign Exchange jointly issued the Opinions of Supporting the Building of the "Two Zones" in Beijing through Facilitating Cross-border Trade, Investment, and Financing in the Region, which includes 16 measures for promoting the facilitation of cross-border trade, investment and financing in Beijing. Important policies will be interpreted in three parts. In Part One, the main policies for deepening the opening-up and innovation of the financial sector will be introduced.

Ⅰ. Supporting the two-way cross-border investment of institutional investors

Simplify the foreign exchange management under the Qualified Foreign Limited Partner (QFLP) system. QFLP refers to foreign natural persons, institutional investors and other specified investors who subscribe to pilot funds.

Clarify that the QFLP quota is administered by a quota balance system. Fund management enterprises can flexibly allocate the QFLP quota of a single fund among all the pilot funds under their management. Unless otherwise specified, the total QFLP quota of all the funds shall not exceed the quota that has been registered by them.

Expand the investment scope of QFLP pilot funds. The overseas funds that have been raised can be used to invest in the equity of domestic non-listed companies, the listed companies' ordinary shares that are not issued or traded in a stock exchange (including block trading of shares and transfer of shares under agreements), and other fields.

The applications of fund management enterprises for the QFLP pilot program qualification and other services shall be handled in accordance with the Guidelines for Foreign Exchange Management in Beijing under the Qualified Overseas Limited Partner (QFLP) System.

Further steps shall be taken in the pilot program of overseas investment by Qualified Domestic Limited Partners (QDLP). QDLP refers to domestic natural persons, institutional investors or other specified investors who subscribe to pilot funds with their self-owned funds.

The investment scope of QDLP pilot funds covers overseas securities markets, and overseas commodities, precious metals, hedge funds, real estate investment trusts (REITS), and financial derivatives and other underlying assets. The pilot funds can be used to initiate sub-funds of overseas securities investment funds, and invest in other securities investment funds. The funds are also allowed to invest in overseas bonds, securities fund shares, overseas unlisted companies, private equity investment funds and other non-public market sectors.

The applications for the qualification of QDLP pilot program, the registration of foreign exchange and other services shall be handled in accordance with the Interim Measures of Beijing Municipality for the Pilot Program of Overseas Investment by Qualified Domestic Limited Partners (QDLP) and relevant implementation rules.

Ⅱ. Facilitating the global overall allocation of funds for multinational companies  

Push forward the pilot cash-pooling service integrating local and foreign currency management for multinational companies. Multinational companies participating in the pilot program can operate and manage the local and foreign currencies at home and abroad in a centralized manner, and apply for services such as the pooling of funds, the offsetting of surpluses against deficits, the centralized receipt and payment of cross-border renminbi under the current account, and the netting settlement. Based on the evaluation of the performance of the pilot cash-pooling service integrating local and foreign currency management for multinational companies, the scope of the pilot program shall be expanded, and the establishment of global or regional capital management centers in Beijing by large multinational companies shall be supported.

Lower the threshold for the centralized operation of cross-border funds of multinational companies in special regions. For the new- and high-tech enterprises in China (Beijing) Pilot Free Trade Zone and the Zhongguancun Science City in Haidian District that carry out the centralized operation of cross-border funds of multinational companies, the requirement for the balance of payments in local and foreign currencies in the previous year shall be adjusted to "more than USD 50 million" from "more than USD 100 million" so that fund operating costs can be brought down.

Ⅲ. Facilitating the management of cross-border funds for foreign institutions

Allow the settlement of foreign exchange funds in the non-resident account (NRA) opened in the China (Beijing) Pilot Free Trade Zone. The foreign exchange funds in a NRA opened by a foreign institution in a bank registered in the China (Beijing) Pilot Free Trade Zone shall be allowed to be settled. The renminbi funds obtained from foreign exchange settlement shall be used for domestic payments and shall not be transferred abroad or into the Free Trade (FT) Account or RMB NRA. If the settlement of foreign exchange funds and the payment of obtained renminbi funds are conducted through the internal accounts of banks with the funds not actually flowing into the territory of China, the document reviewing process can be exempted. Therefore, the receipt, payment and remittance of cross-border funds can be further facilitated for foreign institutions.

Allow foreign institutions to apply for the trading of renminbi and foreign exchange derivatives. For the banks getting registered and having business premises in the China (Beijing) Pilot Free Trade Zone and qualified to handle the applications for the trading of renminbi and foreign exchange derivatives, if they can handle the spot foreign exchange settlement and surrendering transactions for foreign institutions in accordance with relevant regulations, they shall be permitted to handle the applications of foreign institutions for the trading of renminbi and foreign exchange derivatives. This pilot policy includes foreign institutions into the scope of customers of the bank outlets in the China (Beijing) Pilot Free Trade Zone for the trading of renminbi and foreign exchange derivatives, which will make domestic foreign exchange derivatives benefit more market entities and better meet the needs of enterprises for exchange rate hedging.

The funds in RMB NRA can be remitted abroad through foreign exchange purchasing. In accordance with the norms of banks in Beijing for the renminbi service provision, foreign institutions can remit the funds in their RMB NRA through foreign exchange purchasing after going through corresponding procedures, which will facilitate the use of cross-border renminbi funds for non-residents.