Measures on Administration of Auto Finance Companies Is Soliciting for Public Comments

On December 29, 2022, the China Banking and Insurance Regulatory Commission (“CBIRC”) issued the Notice to Solicit for Public Comments on Measures on Administration of Auto Finance Companies (Draft for Solicitation of Comments) (“Draft”). The main revisions are as follows: strengthening risk-based supervision; adapting to the market demand for high-quality development of the automobile industry; strengthening corporate governance and internal control; implementing open policy. The Draft eliminates equity investment business, and also sets higher requirements for funders, strengthens shareholders’ support for auto finance companies, appropriately expands the scope of shareholders’ deposits and cancels the regulations on the term of fixed deposits. In addition, the Draft increases risk management requirements, adds liquidity risk supervisory indicators, and improves major emergency reporting, on-site inspections, extended investigations and tripartite talks.