Administrative Regulations of the People's Republic of China on Foreign-invested Banks (Second Revision in 2014)

Order of the State Council of the People's Republic of China No.657

November 27, 2014

(Promulgated under the Order of the State Council of the People's Republic of China No.478 on November 11, 2006, revised for the first time in accordance with the Decision of the State Council on Revising Certain Administrative Regulations on July 29, 2014, and revised for the second time in accordance with the Decision of the State Council on the Revision of the Administrative Regulations of the People's Republic of China on Foreign-invested Banks on November 27, 2014)

Chapter I General Provisions

Article 1 The Administrative Regulations of the People's Republic of China on Foreign-invested Banks (hereinafter referred to as the "Regulations") are formulated in order to adapt to the needs of opening to the outside world and economic development, strengthen and improve the administration of foreign-invested banks and promote the sound operation of the banking industry.

Article 2 For the purpose of the Regulations, the term "foreign-invested bank" refers to the following institutions established upon approval within the territory of the People's Republic of China according to the relevant laws and regulations of the People's Republic of China:
1. a wholly foreign-owned bank established separately by one foreign bank or jointly with investment from one foreign bank and other foreign financial institutions;
2. a Sino-foreign joint venture bank established with joint investment from foreign financial institutions and Chinese companies and enterprises;
3. a branch of a foreign bank; and
4. a representative office of a foreign bank.
The above-mentioned institutions set forth in Items 1 through 3 are hereinafter collectively referred to as the business institutions of foreign-invested banks.

Article 3 For the purpose of the Regulations, the term "foreign financial institutions" refers to the financial institutions registered outside the territory of the People's Republic of China and approved or permitted by the financial regulatory authorities of their home countries or regions.
For the purpose of the Regulations, the term "foreign banks" refers to the commercial banks registered outside the territory of the People's Republic of China and approved or permitted by the financial regulatory authorities of their home countries or regions.

Article 4 Any and all foreign-invested banks must abide by the laws and regulations of the People's Republic of China and shall never impair the national interests and social and public interests of the People's Republic of China.
All the regular business activities and lawful rights and interests of foreign-invested banks are protected by the law of the People's Republic of China.

Article 5 The banking regulatory authority of the State Council and its local offices (hereinafter collectively referred to as the "banking regulatory authorities") are responsible for the supervision and administration of foreign-invested banks and their activities, and provided that the provisions of laws and administrative regulations have prescribed that other regulatory departments or authorities shall supervise and administer foreign-invested banks and their activities, such provisions shall apply.

Article 6 The banking regulatory authority of the State Council shall formulate the relevant incentives and guiding measures according to the regional economic development strategy and the relevant policies of the State, which will be reported to the State Council for approval of implementation.

Chapter II Establishment and Registration

Article 7 The establishment of foreign-invested banks and their branch offices shall be subject to the examination and approval of the banking regulatory authorities.

Article 8 The minimum amount of registered capital of a wholly foreign-owned bank or of a Sino-foreign joint venture bank shall be CNY1 billion or the equivalent in a freely convertible currency and the registered capital shall be the paid-in capital.
With respect to a branch established by a wholly foreign-owned bank or by a Sino-foreign joint venture bank within the territory of the People's Republic of China, its head office shall grant without compensation operating capital in Renminbi or a freely convertible currency. The sum of operating capital granted by a wholly foreign-owned bank or a Sino-foreign joint venture bank to its establishments shall not exceed 60% of total equity capital of the head office.
With respect to a branch of a foreign bank, the head office shall grant it working capital of no less than CNY200 million or the equivalent in a freely convertible currency.
The banking regulatory authority of the State Council may raise the minimum amount of the registered capital or working capital set for the business institutions of foreign-invested banks and stipulate the proportion of the share of Renminbi according to their business scopes and the need for prudential regulation.

Article 9 The shareholders of a proposed wholly foreign-owned bank or of a proposed Sino-foreign joint venture bank or the foreign bank that proposes to establish branches or representative offices shall meet the following requirements:
1. being of ongoing profitability, good credit standing and having no record of major violation of laws or regulations;
2. that the shareholders of a proposed wholly foreign-owned bank, or the foreign shareholders of a Sino-foreign joint venture bank, or a foreign bank that proposes to establish branches or representative offices shall have experiences in international financial activities;
3. having effective policies on anti-money laundering activities;
4. that the shareholders of a proposed wholly foreign-owned bank, or the foreign shareholders of a Sino-foreign joint venture bank, or a foreign bank that proposes to establish branches or representative offices shall be subject to effective regulation by the financial regulatory authority of the country or region of the place where they are located with their applications approved by such financial regulatory authority; and
5. that other prudential requirements required by the banking regulatory authority of the State Council shall be satisfied.
The country or region where the shareholders of a proposed wholly foreign-owned bank, or the foreign shareholders of a Sino-foreign joint venture bank, or a foreign bank that proposes to establish branches or representative offices are located shall have sound financial supervision and administration systems and their financial regulatory authorities shall have established good regulatory cooperation mechanism with the banking regulatory authority of the State Council.

Article 10 A shareholder that proposes to establish a wholly foreign-owned bank shall be a financial institution, and in addition to the requirements as set out in Article 9 of the Regulations, the sole shareholder or the controlling shareholder shall also meet the following requirements:
1. that it must be commercial banks;
2. that the total assets as at the end of the year prior to the application for establishment shall be no less than USD10 billion; and
3. that the capital adequacy ratio shall meet the requirement of the financial regulatory authority of the country or region where it is located and the banking regulatory authority of the State Council.

Article 11 Where shareholders propose to establish a Sino-foreign joint venture bank, in addition to the requirements as set out in Article 9 of the Regulations, the foreign shareholder and the sole Chinese shareholder or any principal Chinese shareholder shall be a financial institution and the sole foreign shareholder or any principal shareholder shall also meet the following requirements:
1. that it must be a commercial bank;
2. that the total assets as at the end of the year prior to the application for establishment shall be no less than USD10 billion; and
3. that the capital adequacy ratio shall meet the requirement of the financial regulatory authority of the country or region where it is located and the banking regulatory authority of the State Council.

Article 12 In addition to the requirements as set out in Article 9 of the Regulations, any foreign bank proposing to establish branches shall also meet the following requirements:
1. that its total assets as at the end of the year prior to the application for establishment shall be no less than USD20 billion; and
2. that the capital adequacy ratio shall meet the requirement of the financial regulatory authority of the country or region where it is located and the banking regulatory authority of the State Council.

Article 13 The foreign bank that establishes a business institution within the territory of the People's Republic of China shall not establish additional representative offices besides the existing ones, except in regions where the establishment is in line with Chinese regional economic development strategies and the relevant policies.
When any representative office is restructured into a business institution upon approval, the procedures for cancelling registration of the former representative office shall be followed in accordance with the law.

Article 14 For establishing a business institution of a foreign-invested bank, application shall be made for preparation first, with the following application materials submitted to the banking regulatory authority of the place where such institution is proposed to be established:
1. the application, including the name, place, registered capital or working capital and category of operation business concerning the proposed institution;
2. feasibility study report;
3. draft articles of association of a proposed wholly foreign-owned bank or Sino-foreign joint venture bank;
4. operation contract signed by shareholders of a wholly foreign-owned bank or a Sino-foreign joint venture bank;
5. articles of association of the shareholder of a proposed wholly foreign-owned bank or Sino-foreign joint venture bank, or the foreign bank that proposes to establish a branch;
6. organizational structure of the shareholder of a proposed wholly foreign-owned bank or Sino-foreign joint venture bank, or the foreign bank that proposes to establish a branch and its superior group, names of principal shareholders, and names of overseas branch offices and affiliated enterprises;
7. the last three years' annual reports of the shareholder of a proposed wholly foreign-owned bank or Sino-foreign joint venture bank, or the foreign bank that proposes to establish a branch;
8. the anti-money laundering policies of the shareholder of a proposed wholly foreign-owned bank or Sino-foreign joint venture bank, or the foreign bank that proposes to establish a branch;
9. the photocopies of the business licenses or financial operation permits issued by the financial regulatory authority of the country or region where the shareholder of a proposed wholly foreign-owned bank, the foreign shareholders of a proposed Sino-foreign joint venture bank or the foreign bank that proposes to establish a branch is located, and the opinion of the financial regulatory authority on the relevant applications; and
10. other materials prescribed by the banking regulatory authority of the State Council.
The banking regulatory authority of the place where the proposed institution is located shall promptly submit the application materials and the opinion on examination thereof to the banking regulatory authority of the State Council.

Article 15 The banking regulatory authority of the State Council shall, within six months upon receipt of the complete application materials for establishing the business institution of a foreign-invested bank, make a decision on approval or disapproval of the preparation for establishment with a written notice thereof to the applicant, and if a decision on disapproval is made, the reasons thereof shall be provided.
In special cases, the banking regulatory authority of the State Council that fails to complete the examination and make a decision on approval or disapproval of the preparation for establishment within the specified period set out in the preceding paragraph may properly extend the term of examination with a written notice thereof to the applicant, provided that the extension thereof shall not exceed three months.
The applicant shall obtain the application for business commencement from the banking regulatory authority of the place where the proposed institution is located by presenting the approving document for preparation of establishment.

Article 16 The applicant shall complete the preparation work within six months as of the date of the approval of the preparation. In case the preparation work has not been completed within the specified period, the reasons thereof shall be given, and an extension of three months may be given upon approval by the banking regulatory authority of the place where the proposed institution is located. In case the preparation work has not been completed within the extended period, the decision of the banking regulatory authority of the State Council on approval of the preparation for establishment shall automatically become invalid.

Article 17 Where the preparation work is completed and passes the acceptance inspection, the applicant shall complete the application form for business commencement, which shall be submitted to the banking regulatory authority of the place where the proposed institution is located together with the following materials:
1. names and resumes of the principal responsible persons of the proposed institution;
2. authorization of the proposed principal responsible persons of such institution;
3. the capital verification certificate issued by a statutory capital verification institution;
4. security precautions and materials of other business-related facilities;
5. the letters of guarantee of the foreign bank for taking the responsibility for the taxes and debts incurred by its branch if it intends to set up a branch; and
6. other materials prescribed by the banking regulatory authority of the State Council.
The banking regulatory authority of the place where the proposed institution is located shall submit the application materials promptly to the banking regulatory authority of the State Council together with the opinions on the examination thereof.

Article 18 The banking regulatory authority of the State Council shall within two months upon receipt of the complete application materials for business commencement make a decision on approval or disapproval of the business commencement with a written notice thereof to the applicant. If a decision on approval is made, the financial permit shall be issued; while if a decision on disapproval is made, the reasons thereof shall be provided.

Article 19 The business institution of a foreign-invested bank established upon approval shall handle the registration with the relevant administration for industry and commerce and obtain the business license.

Article 20 For establishing a representative office, a foreign bank shall submit the following application materials to the banking regulatory authority of the place where such representative office is located:
1. the application, including the name and place of the representative office;
2. feasibility study report;
3. articles of association of the applicant;
4. organizational structure of the applicant and its superior group, names of principal shareholders, and names of overseas branch offices and affiliated enterprises;
5. the last three years' annual reports of the applicant;
6. the anti-money laundering policies of the applicant;
7. the photocopies of the identity certificate and the academic degree certificates of the proposed chief representative of the representative office, resume and representation for evidencing the non-existence of bad records;
8. authorization of the proposed chief representative of the representative office;
9. the photocopies of the business licenses or financial operation permits issued by the financial regulatory authority of the country or region where the applicant is located, and the opinion of the financial regulatory authority on the relevant applications; and
10. other materials prescribed by the banking regulatory authority of the State Council.
The banking regulatory authority of the place where the proposed representative office is located shall promptly submit the application materials and the opinion on examination thereof to the banking regulatory authority of the State Council.

Article 21 The banking regulatory authority of the State Council shall, within six months upon receipt of the complete application materials for establishing the representative office of a foreign bank, make a decision on approval or disapproval of the establishment with a written notice thereof to the applicant, and if a decision on disapproval is made, the reasons thereof shall be provided.

Article 22 The representative office of a foreign bank established upon approval shall handle the registration with the relevant administration for industry and commerce and obtain the industrial and commercial registration certificate.

Article 23 Except for annual reports, all the materials set out in in Articles 14, 17 and 20 that are made in a foreign language shall be attached with Chinese translation.

Article 24 In the principles of legitimacy, prudence and ongoing operations, with the approval by the banking regulatory authority of the State Council, a foreign bank may transform its branch established within the territory of the People's Republic of China into a wholly foreign-owned bank with sole capital contribution from the foreign bank. The applicant shall file an application for establishing a wholly foreign-owned bank according to the examination and approval conditions, procedures and application materials prescribed by the banking regulatory authority of the State Council.

Article 25 In case a branch of a foreign bank is transformed into a wholly foreign-owned bank with sole capital contribution by its head office, with the approval of the banking regulatory authority of the State Council, such foreign bank may retain one branch for undertaking of foreign exchange wholesale business within the prescribed period. The applicant shall file an application according to the examination and approval conditions, procedures and application materials prescribed by the banking regulatory authority of the State Council.
For the purpose of the preceding paragraph, the foreign exchange wholesale business refers to the foreign exchange business of clients other than individuals.

Article 26 The qualifications for the directors, senior management personnel and chief representatives of foreign-invested banks shall meet the conditions prescribed by the banking regulatory authority of the State Council and shall be in line with the verification and approval of the banking regulatory authority of the State Council.

Article 27 In any of the following circumstances, a foreign-invested bank shall go through the approval of the banking regulatory authority of the State Council, submit the application materials as required and handle the relevant registration with the relevant administration for industry and commerce:
1. change of registered capital or working capital;
2. alteration of the name of the institution and place of business or office;
3. adjustment of business scope;
4. alteration of the shareholders or adjustment of the proportion of shares held by shareholders;
5. modification of articles of association; and
6. other circumstances prescribed by the banking regulatory authority of the State Council.
In case of change of its directors, senior management personnel or chief representatives of a foreign-invested bank, the qualifications of the candidates shall be submitted to the banking regulatory authority of the State Council for verification and approval.

Article 28 In case a wholly foreign-owned bank or a Sino-foreign joint venture bank changes its shareholders, the shareholders after such change shall meet the requirements for shareholders set forth in Article 9, 10 or 11 of the Regulations.

Chapter III Business Scope

Article 29 A wholly foreign-owned bank and a Sino-foreign joint venture bank may, within the business scope approved by the banking regulatory authority of the State Council, carry out part or all of the following foreign exchange and Renminbi services:
1. taking public deposits;
2. issuing short-term, medium-term and long-term loans;
3. handling the acceptance and discount of negotiable instruments;
4. buying and selling government bonds and financial bonds, and buying and selling securities denominated in foreign currency other than stocks;
5. providing letter of credit service and guarantee;
6. handling domestic and foreign settlements;
7. buying and selling per se or as agent foreign exchanges;
8. insurance agent service;
9. conducting inter-bank offer;
10. conducting bank card services;
11. providing safe-deposit box service;
12. providing credit investigation and consulting service; and
13. other business approved by the banking regulatory authority of the State Council.
A wholly foreign-owned bank or a Sino-foreign joint venture bank may, upon approval of the People's Bank of China, conduct the business of settlement and sale of and payment in foreign exchange.

Article 30 Where the branch offices of a wholly foreign-owned bank or a Sino-foreign joint venture bank carries out business within the authorization of its head office, the civil liabilities arising thereof shall be undertaken by its head office.

Article 31 Any branch of a foreign bank may, within the business scope approved by the banking regulatory authority of the State Council, carry out part or all of the following foreign exchange services as well as Renminbi services with the clients other than citizens within the territory of China:
1. taking public deposits;
2. issuing short-term, medium-term and long-term loans;
3. handling the acceptance and discount of negotiable instruments;
4. buying and selling government bonds and financial bonds, and buying and selling securities denominated in foreign currency other than stocks;
5. providing letter of credit service and guarantee;
6. handling domestic and foreign settlements;
7. buying and selling per se or as agent foreign exchanges;
8. insurance agent service;
9. conducting inter-bank offer;
10. providing safe-deposit box service;
11. providing credit investigation and consulting service; and
12. other business approved by the banking regulatory authority of the State Council.
Any branch of a foreign bank may absorb the time deposit of no less than CNY1 million for a single deal from the citizens within the territory of China.
Any branch of a foreign bank may, upon approval of the People's Bank of China, conduct the business of foreign exchange settlement and sales operations.


Article 32 Any and all civil liabilities of the branches and other branch offices of a foreign bank shall be borne by its head office.

Article 33 The representative office of a foreign bank may conduct such non-operating activities as communication, market investigation and consultation related to the business of the foreign bank represented by it.
Any and all civil liabilities caused by the act of the representative office of a foreign bank shall be borne by the foreign bank represented by such representative office.

Article 34 In case the business institution of a foreign-invested bank is to conduct any Renminbi business within the scope set out in Article 29 or Article 31 of the Regulations, it shall meet the following conditions, and shall obtain the approval of the banking regulatory authority of the State Council:
1. having started business within the territory of China for more than one year; and
2. other prudential conditions prescribed by the banking regulatory authority of the State Council.
In case a branch of a foreign bank is transformed into a wholly foreign-owned bank with sole capital contribution by its head office, the time limit specified in Item 1 of the preceding paragraph shall be calculated from the date of the establishment of the branch of the foreign bank.
In case a branch of a foreign bank has been approved to conduct any Renminbi business in accordance with the Regulations and any other branch of the said foreign bank applies for conducting any Renminbi business, the said branch shall not be subject to the restriction specified in Item 1 of Paragraph 1 of the present article.

Chapter IV Supervision and Administration

Article 35 The business institution of a foreign-invested bank shall formulate its business rules and establish and perfect the risk management and internal control systems according to the relevant provisions, and shall abide by and implement them.

Article 36 The business institution of a foreign-invested bank shall abide by the uniform state accounting system and the provisions of the banking regulatory authority of the State Council concerning information disclosure.

Article 37 The foreign debts raised by the business institution of a foreign-invested bank shall be subject to the relevant state provisions.

Article 38 The deposit and lending interest rates as well as various types of fees and rates charged by the business institution of a foreign-invested bank shall be determined by itself in accordance with the relevant provisions.

Article 39 If conducting the deposit business, the business institution of a foreign-invested bank shall deposit reserves according to the provisions of the People's Bank of China.

Article 40 Any and all wholly foreign-owned banks and Sino-foreign joint venture banks shall abide by the provisions of the Law of the People's Republic of China on Commercial Banks concerning the management of the asset-liability ratio. Any wholly foreign-owned bank altered from a branch of a foreign bank funded wholly by its head office and any wholly foreign-owned bank or Sino-foreign joint venture bank established before the enforcement of the Regulations whose asset-liability ratio fails to meet the relevant provisions shall satisfy the stipulated requirements within the time limit specified by the banking regulatory authority of the State Council.
The banking regulatory authority of the State Council may require any wholly foreign-owned bank or any Sino-foreign joint venture bank with relatively high risk and relatively weak management capability to increase its capital adequacy ratio.

Article 41 The business institution of a foreign-invested bank shall make provisions for bad accounts in accordance with the relevant provisions.

Article 42 Both wholly foreign-owned banks and Sino-foreign joint venture banks shall abide by the provisions of the banking regulatory authority of the State Council concerning corporate governance.

Article 43 Both wholly foreign-owned banks and Sino-foreign joint venture banks shall abide by the provisions of the banking regulatory authority of the State Council concerning related-party transactions.

Article 44 30% of the working capital of any branch of a foreign bank shall exist in the form of interest-bearing assets designated by the banking regulatory authority of the State Council.

Article 45 The proportion of the share of Renminbi in the sum of the working capital plus reserves and other items to the Renminbi risk assets of the branch of a foreign bank shall be no less than 8%.
The banking regulatory authority of the State Council may require any branch of a foreign bank with relatively high risk and relatively weak management capability to increase the proportion specified in the preceding paragraph.

Article 46 Any branch of a foreign bank shall ensure the liquidity of its assets. The proportion of the balance of the liquid assets to the balance of the liquid liabilities shall be no less than 25%.

Article 47 The balance of the assets within the territory of China in domestic and foreign currencies of any branch of a foreign bank shall be no lower than the balance of the liabilities within the territory of China in domestic and foreign currencies of such branch.

Article 48 Any foreign bank that has established two or more branches within the territory of the People's Republic of China shall authorize one of such branches to conduct uniform management of all such branches.
The banking regulatory authority of the State Council shall implement the regulation on a consolidated basis over all the branches established by a foreign bank within the territory of the People's Republic of China.

Article 49 The business institution of a foreign-invested bank shall, according to the relevant provisions of the banking regulatory authority of the State Council, report to the banking regulatory authority in the place where it is located the information on its across-border big-sum capital movement and transfer of assets.

Article 50 The banking regulatory authority of the State Council may, based on the risk situation of the business institution of a foreign-invested bank, take such special regulatory measures as ordering to cease part of its business temporarily and ordering to dismiss and replace any member of its senior management personnel in accordance with the law.

Article 51 The business institution of a foreign-invested bank shall engage a certified public accountants incorporated in the People's Republic of China in accordance with the law to audit its financial and accounting reports, and shall make a report to the banking regulatory authority of the place where it is located. In case of dismissal of the certified public accountants, the reasons thereof shall be explained.

Article 52 The business institution of a foreign-invested bank shall submit the financial and accounting reports, statements and the relevant materials to the banking regulatory authorities according to the relevant provisions.
The representative office of a foreign bank shall submit materials to the banking regulatory authorities according to the relevant provisions.

Article 53 Foreign-invested banks shall accept but not refuse or impede the supervision and inspection of the banking regulatory authorities.

Article 54 A wholly foreign-owned bank or a Sino-foreign joint venture banks shall set up independent internal control system, risk management system, financial accounting system and computer information management system.

Article 55 Neither the chairman of the board or the senior management personnel of any wholly foreign-owned bank established by a foreign bank within the territory of the People's Republic of China nor the senior management personnel of any branch of a foreign bank engaging in foreign exchange wholesale business may take a concurrent post in each other.

Article 56 Any transaction between a wholly foreign-owned bank established by a foreign bank within the territory of the People's Republic of China and any branch of such foreign bank engaging in foreign exchange wholesale business must be in compliance with business principles, and in no case may the conditions of such transaction be more favorable than the conditions of the transactions between non-affiliated parties. A foreign bank shall provide full guarantee for any fund transaction between any wholly foreign-owned bank established by it within the territory of the People's Republic of China and the branch of the foreign bank engaging in foreign exchange wholesale business.

Article 57 Neither the representative office of a foreign bank nor any of its workers may conduct any business activity in any form.

Chapter V Termination and Liquidation

Article 58 Where the business institution of a foreign-invested bank ceases its business activity on its own initiative, it shall file an application to the banking regulatory authority of the State Council in written form 30 days prior to the ceasing of such activity, whereby it shall be dissolved or closed down and liquidated subject to the examination and approval.

Article 59 In case the business institution of a foreign-invested bank has or may be suffered from a credit crisis, thus resulting in any serious impact on the legitimate rights and interests of depositors and other clients, the banking regulatory authority of the State Council may take over or help reorganize the business institution of the foreign-invested bank in accordance with the law.

Article 60 In case of the termination of the business institution of a foreign-invested bank due to dissolution, or closedown, or being cancelled or declared bankrupt in accordance with the law, specific matters concerning its liquidation shall be handled according to the provisions of the relevant laws and regulations of the People's Republic of China.

Article 61 Upon the completion of liquidation, the business institution of a foreign-invested bank shall handle the cancellation of registration at the original registration authority within the statutory time limit.

Article 62 If the representative office of a foreign bank is to cease its activities on its own initiative, the closedown of such representative office shall be subject to the approval of the banking regulatory authority of the State Council, for which it shall handle the cancellation of registration at the original registration authority within the statutory time limit.

Chapter VI Legal Liability

Article 63 In case any party establishes a foreign-invested bank or illegally conducts any business activity of a banking financial institution without the examination and approval of the banking regulatory authority of the State Council, the banking regulatory authority of the State Council shall revoke such foreign-invested bank, and shall not accept the application for establishing a foreign-invested bank made by such party in question within five years from the day of the revocation of the foreign-invested bank; in case a crime has been constituted, the criminal responsibilities thereof shall be prosecuted in accordance with the law; in case no crime has been constituted, the banking regulatory authority of the State Council shall confiscate the illegal gains and may impose a fine of more than the amount of but less than five times the illegal gains if the illegal gains are not less than CNY500,000; in case there are no illegal gains or the illegal gains are less than CNY500,000, a fine of more than CNY500,000 but less than CNY2 million shall be imposed.

Article 64 If the business institution of a foreign-invested bank is found under any of the following circumstances, the banking regulatory authority of the State Council shall order it to make corrections thereto and confiscate the illegal gains, and shall impose upon such business institution a fine of more than the amount of but less than five times the illegal gains if the illegal gains are not less than CNY500,000; in case there are no illegal gains or the illegal gains are less than CNY500,000, it shall impose a fine of more than CNY500,000 but less than CNY2 million; in case of especially serious circumstance or failure to make corrections within the time limit, it may order such business institution to cease business operations for rectification or revoke its financial permit; and in case a crime is constituted, criminal responsibilities shall be prosecuted in accordance with the law:
1. having established any sub-branch without approval;
2. having conducted any alteration or termination without approval;
3. having conducted any business activity without approval and in violation of the relevant provisions; or
4. increasing or reducing the deposit interest rates or lending interest rate in violation of the relevant provisions.

Article 65 If a foreign-invested bank falls under any of the following circumstances, the banking regulatory authority of the State Council shall order it to make corrections thereto and impose upon it a fine more than CNY200,000 but less than CNY500,000; in case of especially serious circumstance or failure to make corrections within the specified time limit, it may order such foreign-invested bank to cease business operations for rectification or revoke its financial permit or shut down its representative office; and in case a crime is constituted, criminal responsibilities shall be prosecuted in accordance with the law:
1. failing to make the information disclosure according to the relevant provisions;
2. refusing or impeding the supervision and inspection conducted by the banking regulatory authority in accordance with the law;
3. providing any false financial and accounting report, statement or relevant material, or any financial and accounting report, statement or relevant material with concealment of important facts;
4. concealing or destroying any document, certificate, book, electronic data or other material that is required for the supervision and inspection;
5. appointing any director, senior executive, chief representative without the approval of his/her qualification; or
6. refusing to carry out any of the special regulatory measures prescribed in Article 50 of the Regulations.

Article 66 If the business institution of a foreign-invested bank has violated the relevant provisions of the Regulations by failing to submit the financial and accounting reports, statements or the relevant materials on schedule, or if it has failed to set up the relevant business rules or establish and prefect the relevant management systems according to the relevant provisions, such business institution of the foreign-invested bank shall be ordered to make corrections thereto by the banking regulatory authority of the State Council; and in case of failure to make such corrections within the specified time limit, it shall be given a fine of more than CNY100,000 but less than CNY300,000.

Article 67 If the business institution of a foreign-invested bank has violated any of the relevant provisions of Chapter IV of the Regulations in conducting business operations or has seriously violated any other prudential business rule, the banking regulatory authority of the State Council shall order it to make corrections thereto and impose upon it a fine of more than CNY200,000 but less than CNY500,000; and in case of especially serious circumstance or failure to make corrections within the time limit, the banking regulatory authority of the State Council may order it to cease business operations for rectification or revoke its financial permit.

Article 68 In case of violation of any of the provisions of the Regulations by the business institution of a foreign-invested bank, the banking regulatory authority of the State Council may, in addition to the punishments as stipulated by Articles 63 through 67 of the Regulations, take the following measures by distinguishing different circumstances:
1. ordering the business institution of a foreign-invested bank to dismiss and replace the director and senior executive in direct charge and any other functionary who is under direct responsibilities;
2. giving a warning to the director and senior executive in direct charge and other functionary who is under direct responsibilities, and imposing upon such person a fine of more than CNY50,000 but less than CNY500,000 in case the conduct of the business institution of a foreign-invested bank does not constitute a crime; or
3. canceling the qualification of the director and senior executive in direct charge for taking a post within the territory of the People's Republic of China for some period or even for life, or prohibiting the director and senior executive in direct charge and other functionary who is under direct responsibilities from engaging in the banking industry within the territory of the People's Republic of China for some period or even for life.

Article 69 If the representative office of a foreign bank has violated any provision of the Regulations and conducted operating activities, the banking regulatory authority of the State Council shall order it to make corrections thereto and give it a warning, and shall, if the illegal gains are not less than CNY500,000, impose upon it a fine of more than the amount of but less than five times the illegal gains; if no illegal gains are involved or if the illegal gains are less than CNY500,000, a fine of more than CNY500,000 but less than CNY2 million shall be imposed; in case of serious circumstance, such representative office shall be shut down by the banking regulatory authority of the State Council; and in case a crime is constituted, criminal responsibilities shall be prosecuted in accordance with the law.

Article 70 If the representative office of a foreign bank is found under any of the following circumstances, the banking regulatory authority of the State Council shall order it to make corrections thereto, give it a warning, and impose upon it a fine of more than CNY100,000 but less than CNY300,000; in case of serious circumstance, the qualification of the chief representative for taking a post within the territory of the People's Republic of China shall be revoked for some period or the foreign bank represented by the chief representative shall be requested to dismiss and replace the chief representative; in case of especially serious circumstance, the representative office shall be shut down by the banking regulatory authority of the State Council:
1. changing the place of office without approval;
2. failing to submit the materials to the banking regulatory authority of the State Council according to the relevant provisions; or
3. violating the Regulations or any other provision of the banking regulatory authority of the State Council.

Article 71 Any foreign-invested bank that violates any other laws and regulations of the People's Republic of China shall be handled by the competent authority in accordance with the law.

Chapter VII Supplementary Provisions

Article 72 The Regulations shall apply mutatis mutandis to the banking institutions established in the mainland of China by financial institutions from such regions as Hong Kong Special Administrative Region, Macao Special Administrative Region, and Taiwan Region, unless otherwise prescribed by the State Council.

Article 73 The Regulations shall come into force as of December 11, 2006. The Administrative Regulations of the People's Republic of China on Foreign-invested Financial Institutions promulgated by the State Council on December 20, 2001 shall be repealed simultaneously.