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New rules introduced to allow PRC corporate to lend to its offshore parent company

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Matthias Voss

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Victor Ho

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Yvonne Ho

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Jane Jiang

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Matthew Bisley

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Cindy Lo

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07 December 2012

In November 2012, new regulatory rules were introduced by the State Administration of Foreign Exchange of the PRC (SAFE) to allow a PRC corporate to make loans to its offshore parent company.
At about the same time two transactions involving foreign invested enterprises (FIEs) in the PRC lending in RMB to their offshore affiliates, with the approval of the People's Bank of China (PBOC) under a pilot scheme, were reported.

In this eBulletin we will highlight the relevant regulatory changes and discuss how they may benefit foreign investors.
 
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