China's SAFE Draft Would Expand Payment Institutions' FX Services for New Trade Formats

According to Jin10, China's State Administration of Foreign Exchange (SAFE) has published a draft notice on further optimizing current-account foreign-exchange administration for public comment. The draft would allow payment institutions, in addition to providing foreign-exchange services for cross-border e-commerce, to offer agency foreign-exchange settlement and sales, as well as related fund payment and receipt services, to market entities engaged in new trade formats such as market procurement trade and comprehensive foreign trade services. It would also lower the threshold for domestic foreign-exchange settlement in operating leases, remove the eligibility restriction based on lessees' foreign-exchange income, and allow lessees to buy foreign exchange to pay rent to lessors when transactions are genuine and compliant.