Two Departments Optimize Four Policies to Promote Integrated Domestic and Foreign Currency Cash Pool Business Pilot for Multinational Corporations

On December 18, 2024, the People’s Bank of China (PBOC) and the State Administration of Foreign Exchange (SAFE) announced their decision to optimize the pilot policies (the “Policies”) for the integrated domestic and foreign currency cash pool business for multinational corporations in 10 provinces and cities, covering regions such as Shanghai, Beijing, Jiangsu, Zhejiang, Guangdong, Hainan, Shanxi, Ningbo, Qingdao, and Shenzhen.

The main contents of the Policies include: first, allowing intracompany lending between domestic member enterprises of multinational corporations in different currencies for cross-border current account payments; second, simplifying the filing process and the review of materials related to foreign-related receipts and payments; third, permitting multinational corporations to independently determine the collection ratio of foreign debt and outbound loans based on macro-prudential principles; and fourth, supporting multinational corporations’ host enterprises to handle centralized receipts and payments between their domestic member enterprises or foreign entities through the main domestic fund account on behalf of overseas member enterprises.