On December 5th, the "Implementation Measures for Upgrading the Functions of Free Trade Accounts in the Shanghai Free Trade Zone (Trial)" (hereinafter referred to as the "Trial Measures"), issued by the Shanghai Headquarters of the People's Bank of China, officially came into effect. It is understood that the Trial Measures significantly enhance the functions of the existing free trade account system, further improving the level of liberalization and facilitation of cross-border trade and investment.
According to a Financial Times reporter, on the day the pilot measures were officially implemented, all participating Chinese banks, including the Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, China Construction Bank, and Bank of Communications, as well as foreign banks such as HSBC China and Citibank China, completed the business implementation.
Industrial and Commercial Bank of China
On December 5th, the Industrial and Commercial Bank of China (ICBC) processed a cross-border RMB loan for an advanced manufacturing company using its upgraded free trade account, marking the completion of its first transaction. The funds will reportedly be used to purchase goods domestically, facilitating the cross-border flow of RMB funds.
"As one of the first pilot banks, ICBC Shanghai Branch actively promoted the policy to eligible clients, which received positive responses from advanced manufacturing and high-tech enterprises," said a relevant person in charge of ICBC Shanghai Branch. When handling overseas lending for these clients, the branch adopted the "document-free" method for cross-border capital account receivables and payables for the first time, achieving payment and settlement simultaneously.
Agricultural Bank of China
A leading integrated circuit chip manufacturer is one of the beneficiaries of the two free trade account function upgrade transactions completed by the Agricultural Bank of China on December 5th. This company is a leading enterprise in China's semiconductor field and a top 100 unicorn enterprise under CCID Consulting. With years of experience in the industry, it leverages its deep technological accumulation and innovative product development capabilities to provide core support for high-end automotive chip manufacturing.
"After the upgrade, funds can be received and paid based solely on payment instructions, eliminating the need to submit contracts, invoices, or other documents. This significantly improves the efficiency of fund transfers and provides strong support for the self-reliance and controllability of my country's chip industry in the financial sector," said a representative from the company.
Bank of China
On the day the trial measures were officially implemented, Bank of China helped five companies directly handle various businesses based on payment instructions, such as cross-border financing and overseas lending under the upgraded free trade account, covering multiple industries including chip semiconductors, petrochemicals, and automobiles.
In addition, the Bank of China has successfully piloted foreign currency transfers for goods and services trade between non-resident free trade accounts (FTN accounts, which are free trade accounts of overseas institutions) and domestic accounts, facilitating fund settlement between non-resident enterprises and domestic enterprises.
China Construction Bank
On the first day of the new policy's implementation, China Construction Bank processed upgrades for the free trade account functions of several key enterprises, empowering their global operations.
Oriental International Venture Co., Ltd. is one such example. According to reports, in response to the core needs of cross-border operations in the foreign trade sector, China Construction Bank's Shanghai branch upgraded the free trade account function for the company, improving the efficiency of cross-border fund receipts and payments. "This move not only injects financial momentum into the implementation of the company's strategy, but also drives domestic labor-intensive industries to connect with the large market under the Regional Comprehensive Economic Partnership (RCEP), enhancing their resilience in transnational operations and steadily achieving high-quality development," said a relevant负责人 from China Construction Bank's Shanghai branch.
Bank of Communications
On December 5, Bank of Communications upgraded the free trade account functions for two companies.
"The selection of the first batch of pilot enterprises focuses on multinational corporate groups, with preference given to companies registered in the new area. The selection scope includes state-owned enterprises, private enterprises, and foreign-invested enterprises." According to a relevant person in charge of the Shanghai branch of Bank of Communications, the bank's selection process strictly follows policy standards, focusing on the overall operating capabilities of enterprises, taking into account core indicators such as the company's years of operation, financial performance, and international balance of payments, while also verifying compliance records and the genuine needs of cross-border business.
HSBC China
On December 5, HSBC China announced that, as one of the first foreign banks to pilot the upgrade of Shanghai Free Trade Zone accounts, it has opened an upgraded free trade account for a multinational company participating in the pilot program within the Shanghai Free Trade Zone.
“As the latest measure for China’s high-level financial opening-up, this pilot policy not only adds to the functions of the free trade account, but also brings a multiplier effect to the liberalization and facilitation of cross-border trade and investment,” said Zeng Su, Managing Director of Global Payments Solutions at HSBC China. “After opening accounts for enterprises, we will actively explore the facilitation and innovation of financial services based on the upgraded free trade account, so as to better serve the cross-border trade and investment needs of enterprises.”
Citibank China
On the first day of the trial implementation, Citibank China opened upgraded free trade accounts for four corporate clients in Shanghai.
“The Shanghai Free Trade Zone is at the forefront of China’s financial reform. This upgrade of the free trade account will further enhance the efficiency and convenience of cross-border financial services in the free trade zone,” said Zhang Wenjie, President of Citigroup China and CEO of Citigroup China. He added that Citigroup China assisted clients in upgrading their accounts on the first day of the new policy’s implementation, demonstrating their commitment to supporting the opening up of China’s financial market.
