The five commitments are:
1 China will revoke the original regulation that establishment of foreign-funded institutions must get approval by the State Council. Foreign-funded financial institutions can apply for setting up commercial institution in any city within China under the premise of meeting requirements.
2 Control of targets on foreign exchange service by foreign financial institutions is to be lifted.
3 China will cancel the current business scale limitation as regulated for foreign firms in RMB market admission, but foreign financial institutions must meet three basic requirements for running RMB business: first, business in China over three years, second, making profit for two consecutive years, third, meeting requirement of caution as stipulated by the People's Bank of China for foreign exchange loan of solely foreign-owned banks, joint venture banks, solely foreign-run financial firms and joint venture firms.
4 China will loose control on setting up joint venture banks or joint venture financial firms, that is to cancel the regulation that the Chinese side must be a financial institution. Foreign financial providers can choose any Chinese company as their partners.
5 China will increase business scope for RMB operation by foreign funded companies, and it will also open wider on RMB business services in regions and targets to foreign firms.
The new regulations, published by the State Council, will come into effect on February 1, 2002. The old rules with the same title, promulgated in 1994, will become history on the same day.
(People's Daily December 31, 2001)
