The CBRC Issued A Notice on Cleaning Up And Regulating the Business of Non-financial Subsidiaries of Trust Companies.
On July 30, the General Office of the China Banking and Insurance Regulatory Commission issued a notice on cleaning up and regulating the business of non-financial subsidiaries of trust companies.
From the date of issuance of the circular, trust companies are not allowed to create new domestic level non-financial subsidiaries, and established domestic level non-financial subsidiaries are not allowed to create new investments in domestic and foreign enterprises.
The trust company's investments in the following enterprises fall within the scope of liquidation under the Notice: first, the enterprises in which the trust company's domestic first-tier non-financial subsidiaries have invested domestically and abroad that it has chosen to retain in accordance with the provisions of the Notice; second, the trust company's remaining domestic first-tier non-financial subsidiaries and the enterprises in which it has invested domestically and abroad. The trust company's investment in the above-mentioned enterprises shall be liquidated by transferring equity interests and other means, and the liquidation period shall not exceed three years. If there is a surviving fund business in the above-mentioned enterprises, the trust company may not be subject to the aforementioned period, but should complete the liquidation of the investment within one year after the liquidation of the relevant project. If there are difficulties in liquidation, the trust company may submit a report to the local CBIRC to extend the liquidation period once, and the extension period shall not exceed one year.
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