 Smart Tips/FAQs
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| 1. |
Are all commercial customers eligible to open RMB Trade Settlement Accounts (i.e. RMB Savings Account and/or RMB Current Account, hereafter "RMB TSE Accounts"), with Hang Seng Bank? |
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Commercial customers with genuine needs in trade settlement (including mercantile & service trade) are eligible to open RMB TSE Accounts with Hang Seng Bank in accordance with the normal account opening procedure.
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| 2. |
Following the latest regulatory development on the Renminbi Business, what are the enhanced RMB Cross-border Trade Settlement services that can be offered by banks in Hong Kong from 11 February 2010? |
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| Services |
After 11 Feb 2010 |
| Service Coverage |
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Apart from trade services, RMB business loans, cheque and credit card services for commercial customers can also be provided |
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| Deposit & Withdrawal |
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Applicable to RMB receipts & payments derived from both mercantile & service trade transactions
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Commercial customers can determine the use of RMB funds maintained in their RMB TSE Accounts (except those RMB funds derived from exchange) as long as it relates to trade settlement and does not involve the flow of these funds back to the Mainland
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For outflow of RMB to the Mainland, it must be related to RMB trade settlement and comply with applicable rules and requirements announced by the Mainland Authorities
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| Currency Exchange |
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Commercial customers can convert HKD/other foreign currencies into RMB for payment to their trade counterparties in the Mainland or for repayment of trade loans. The exchanged amount is capped by the trade settlement amount or the loan repayment amount
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No upper limit is set for RMB funds maintained in RMB TSE Accounts or for conversions from RMB into HKD/ other foreign currencies
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| Remittances |
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RMB remittances to and out of the Mainland for the purpose of trade settlement are allowed provided that they comply with the rules and requirements stipulated by the Mainland Authorities
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Remittances conducted by Mainland counterparties are verified by the Mainland Authorities and Mainland banks
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| Interbank transfers/ cheques |
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Both third-party and/or same name account transfers between corporates are allowed
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| Trade Services |
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Apart from mercantile trade, service trade can also be settled in RMB
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| Lending |
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Trade Finance (e.g. Import and Export Trade Finance) denominated in RMB
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Different types of RMB business loans
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| RMB Bonds |
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Any Hong Kong or overseas corporate can issue RMB bonds in Hong Kong, subject to the applicable governing rules in Hong Kong
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Commercial customers can subscribe for RMB bonds with the RMB funds in the RMB TSE Accounts and pledge them as collateral for financing
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| 3. |
Can commercial customers open or maintain both the Designated Business Customer ("DBC") Account and the RMB TSE Accounts with Hang Seng Bank? |
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Both types of accounts can be opened if the relevant conditions are fulfilled, but they should be maintained and operated separately. These two account types are subject to different regulatory requirements. According to the regulatory requirements, the transfer of RMB funds from the RMB TSE Accounts to the DBC Account is not allowed.
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| 4. |
Can commercial customers deposit or withdraw RMB cash from the RMB TSE Accounts? |
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Yes. RMB cash deposit and withdrawal are processed according to the usual practice in handling other currencies.
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| 5. |
Can the RMB deposits be pledged for loan financing? |
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Yes, deposits denominated in either RMB or other foreign currencies can be pledged for loan financing.
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| 6. |
Does the Mainland Designated Enterprises ("MDEs") qualification still exist? Can I conduct RMB trade settlements with non-MDEs? |
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The MDE qualification still exists. MDEs are allowed to settle both exports and imports in the RMB. For non-MDEs in Shenzhen, Guangzhou, Zhuhai, Dongguan and Shanghai, they are allowed to settle their imports and exports with the RMB. However, for non-MDEs in Shanghai, they are advised to consult the local tax administration for export tax rebate issues if they choose to receive RMB for their exports.
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| 7. |
Can RMB trade settlement with Mainland counterparties located outside the pilot cities, i.e. Guangzhou, Shenzhen, Zhuhai, Dongguan and Shanghai, be conducted? |
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It is subject to the approval of Mainland authorities, including branches of the People's Bank of China ("PBoC") in the respective provinces.
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| 8. |
Will the "Pilot Program of RMB Settlement of Cross-border Trade Transactions" be extended to more Mainland locations? |
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Currently, pilot locations include 5 cities, four in Guangdong Province and Shanghai. It is expected that more locations will be added shortly.
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| 9. |
Is there any restriction on the remittance amount conducted via the RMB TSE Account? How can I make sure that the RMB inward remittances received are initiated by MDEs? As a recipient, do I have to submit any proof in this regard? |
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For RMB outward remittance, the remittance amount is up to the transaction amount of underlying trade transactions. For RMB inward remittance, Mainland authorities and banks will verify the identity of the remitter and the underlying trade transactions before the outward remittance can be effected. Therefore, participating banks and recipients in Hong Kong are not required to undertake further identity verification with regards to RMB inward remittances.
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| 10. |
Can two-way exchange between the RMB and HKD/ or other foreign currencies be conducted freely? |
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HKD/other foreign currencies can be exchanged into RMB for the purpose of cross-border trade settlement only. The amount exchanged shall be paid directly to your trading counterparties in the Mainland or for repayment of trade finance. There is no restriction on the conversion from RMB into HKD/other foreign currencies.
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| 11. |
I was told that corporates outside China are allowed to open an offshore RMB Trade Settlement Account on the Mainland. What is the purpose of the account? What documents are required for opening such an offshore account? |
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Companies outside Mainland China can open an offshore account with Mainland banks for the purpose of cross-border trade settlement. Yet, cash withdrawal is not allowed.
Documents required for opening an offshore account with Mainland banks include but are not limited to, Certificate of Incorporation, Identification document(s) of directors & signatories, Memorandum and Articles of Association, etc. Other documents may be required by the respective PBoC local office and the Mainland bank. All documents submitted to PBoC should be in Chinese or translated into Chinese.
Since the account operation is subject to the administration of the relevant local PBoC branch, account opening bank is required to obtain respective PBoC branch's prior approval before account opening.
The above information is for reference only. Customers who are interested in opening an offshore account may contact Hang Seng Bank (China) Limited for updated application details.
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| 12. |
How to hedge the exchange rate risk from settling purchases in the RMB and receiving payments from buyers in other foreign currencies (e.g. EUR, USD, etc)? |
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Eligible customers may consider hedging against exchange rate risk by entering into RMB non-deliverable forward (NDF) contracts.
Please contact our Relationship Managers for details.
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| 13. |
Are RMB trade settlement services of Hang Seng Bank available for locations outside Hong Kong? |
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Our Macau Branch also offers RMB trade settlement services. Furthermore, Hang Seng Bank (China) Limited is one of our correspondent banks on the Mainland and is a Mainland settlement bank offering RMB trade settlement services to commercial banks outside the Mainland, as well as MDEs on the Mainland.
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| Notes: |
| All the information set out in this web page is provided to the best of the Bank's knowledge and understanding of the relevant laws, rules, regulations, directions and guidelines governing or otherwise applicable to the Renminbi Trade Settlement Accounts, (i.e. Renminbi Savings Account and/or Renminbi Current Account) and/ or Renminbi Trade Settlement Services. Please refer to any updates which may be published or issued by the Bank at any time and from time to time and any latest guidelines issued by the regulatory authorities governing the same from time to time. Please also visit the Bank's branches or contact the staff of the Bank for the most updated information on the above.
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