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China has promulgated a set of administrative rules governing auto financing companies (AFCs) as part of its commitments to fulfilling the country's WTO entry obligations.
The rules were issued Friday by the China Banking Regulatory Commission (CBRC), with approval from the State Council, the commission announced Saturday.
Upon its entry into the WTO in December, 2001, China was committed to allowing the establishment of a non-bank financial institution to provide auto financing services.
Accordingly, China's regulatory authority started drafting the Administrative Rules Governing Auto Financing Companies, and the final rules came as a result of wide collection of views and comments, a study of China's auto financing market, and numerous revisions of the drafts, a spokesman for the CBRC said.
The AFCs provide loans for vehicle sales and engage in other financial activities.
Containing five chapters with 42 articles, the new rules set forth an AFC's functions, conditions for an AFC's incorporation, change and termination, the business lines permitted to an AFC, and penalties on non-compliance activities of an AFC.
"The rules will contribute to the cultivation of an auto financing market in China characterized with diversified sources of financing and provision of professional services," the CBRC spokesman said.
"This approach will ultimately contribute to the growth of the auto industry and the healthy and sustained development of China's economy," he noted.
Consistent with the promulgation of the rules, a set of corresponding implementation rules formulated by the CBRC will be promulgated soon, according to a CBRC source.
(Xinhua News Agency October 06, 2003)
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