Shen Guanglang and Wang, Shenzhen Finance, No.7, 2005.
In recent years, a new term "offshore business operation" has appeared in China's economic life, and the corresponding offshore financial market has also quietly emerged in Shenzhen and Shanghai. How to correctly understand offshore business activities and offshore financial services, and how to choose an appropriate model to effectively supervise them and make them become positive productive forces are topics that we need to explore and study at present.
1. After the "pilot" and development of 16, China has initially formed an offshore financial market.
1989 In May, China Merchants Bank was approved to open an offshore bank in Shenzhen, which was the first offshore financial service in China. Subsequently, Shenzhen Development Bank, Guangdong Development Bank and its Shenzhen branch, China Industrial and Commercial Bank and China Agricultural Bank Shenzhen branch successively obtained offshore banking licenses, and the offshore financial market in China began to develop. 1At the end of 1998, affected by the Southeast Asian financial crisis, the quality of offshore assets of domestic banks deteriorated, and the central bank and the State Administration of Foreign Exchange suspended the offshore assets business of all Chinese banks. In June 2002, the head office of the People's Bank of China issued a document approving China Merchants Bank and Shenzhen Development Bank to fully resume offshore business, while allowing Bank of Communications and Shanghai Pudong Development Bank, which are headquartered in Shanghai, to conduct offshore business, and the offshore financial market started in Shanghai. Although many local governments and other commercial banks have great interest and desire to operate offshore business, so far, the central bank has only issued offshore bank licenses to the above four Chinese banks, and all of them are prudently supervised according to the standards of "pilot" and "trial" in management. Taking the data on June 30, 2004 as an example, the operating conditions of offshore business of four licensed banks are shown in table 1.
Table 1 List of Main Operating Indicators of Offshore Business of Four Licensed Banks
As of June 30, 2004 (millions of US dollars)
China Merchants Bank, Shenzhen Development Bank, Pudong Development Bank and Bank of Communications projects
The deposit balance is 38,426,29,996,33,458,19,071.
The loan balance is 7,352 5,75610,425 7 150.
The balance of non-performing loans is 37,565,438+065,438+0,654,38+0,9565,438+0,000.
Profit 305 147 50 55
Settlement amount is 368,298122, 150 9 1 068 5 1, 04 1.
Data source: Statistics table of enjoyment data of overseas Chinese banks in June 2004.
To be exact, the above four banks are all "fully licensed Chinese banks" among offshore banks. Because China Industrial and Commercial Bank Shenzhen Branch, China Agricultural Bank Shenzhen Branch, Guangdong Development Bank Head Office and its Shenzhen Branch are only allowed to engage in offshore debt business, that is, they hold limited offshore business licenses or "half boards", and their total business scale is about 6,543.80 billion US dollars. In addition to Chinese banks, financial institutions that can provide services to non-residents in Chinese mainland include branches of foreign banks in China and some joint venture banks (such as Huashang Bank and Xiamen International Bank). Most domestic branches of foreign banks provide all-round services to non-residents through their internal electronic systems in the form and name of so-called "global services", that is, "taking orders at home and handling them overseas". At the end of 2004, the balance of foreign currency deposits in domestic and foreign financial institutions was nearly $9 billion. It is conservatively estimated that if 1/4 of the above deposits come from non-residents, it will be US$ 2.3 billion. If the US$ 3.3 billion offshore deposits from Chinese banks are added, the scale of offshore deposits in Chinese mainland will reach US$ 6 billion. This is an emerging financial market that has begun to take shape, and we must pay attention to it, especially the regulatory authorities.
Second, offshore business operation is an unavoidable objective existence, which is having a great impact on China's economy.
The concept of offshore finance originated from offshore commercial operation. The latter refers to non-residents, mainly international business companies (IBC), who invest and trade in countries or regions other than their registered places to obtain commercial profits. Because of its simple registration, low taxes and being able to avoid the supervision of local government and laws, IBC has become a widely used commercial and investment tool for many large companies, including Fortune 500 companies. Avoiding supervision, convenient operation and low operating cost determine the inevitability of offshore commercial activities, and there is a reason for existence if there is market demand. In this sense, our attitude towards "offshore phenomenon" should first admit its objectivity, face it positively, participate in this internationally recognized and accepted commercial and financial activities with an open mind, and abide by the corresponding rules of the game.
In the past 20 years, Chinese mainland is the fastest growing and most dynamic region in the world, and it has formed a "magnet" effect, attracting offshore companies from all over the world to engage in trade related to China. Recently, China has become the sixth largest trading country in the world (in 2004, China's total import and export trade reached 1 1. 15 trillion US dollars) and the largest FDI recipient in the world (in 2004, China attracted more than 50 billion US dollars). Statistics show that among the above-mentioned sources of FDI, Hong Kong, BVI, Cayman and other "offshore islands" are the top, and most of them from the United States, Japan and the European Union operate offshore. In addition, China's foreign investment is also growing rapidly, and IBC will definitely become the best operating tool. It can be seen that the concept of offshore has entered our economic life with irreversible momentum, and Chinese mainland's offshore business activities will continue to flourish, which will have a noticeable impact on China's economy. We can't avoid this objective existence, so we can only study it carefully, make the best use of the situation, avoid its adverse effects, and turn external favorable conditions into internal development impetus to serve our economic construction.
Third, the offshore financial resources centered on Chinese mainland are the national strategic resources that China must strive for. We must cultivate our own offshore financial market and offshore financial center.
Offshore financial activities serve offshore commercial operations, and offshore commercial operations promote the development of offshore finance, which constitute what we call offshore financial resources.
At present, financial resources have become the international strategic resources that countries compete for. Although the United States has a huge deficit in current account for a long time, the main reason why the economy can maintain rapid growth is that it has maintained its absolute advantage in the competition of international financial resources. A large number of low-cost international hot money has balanced the balance of payments deficit of the United States and boosted the economic growth of the United States. International financial resources include not only foreign direct investment financial resources, but also offshore financial resources from other countries and regions. Offshore business activities with Chinese mainland as the actual investment destination are important international strategic resources that China can and should make use of.
International offshore commercial institutions operating in Chinese mainland have only two choices when choosing financial services: one is offshore financial center (OFC), including IFC, RFC and bookkeeping center; Second, offshore financial institutions in China. Obviously, if the regulatory authorities do not open offshore business to Chinese financial institutions, a large amount of offshore financial resources will flow to OFC, and we can't stop the operation of these offshore commercial and financial activities in any case, and gain huge commercial benefits in China.
Opening offshore business to Chinese-funded financial institutions will bring overseas funds attracted to the mainland and domestic funds flowing overseas into the business scope of China financial institutions, provide services of the same quality as those in the international financial market, and also give us an opportunity to develop the economy by using low-cost international resources. Why not? Therefore, cultivating a fair and healthy offshore financial market and then building an offshore financial center should be the strategic choice of the regulatory authorities. The economic and social benefits of such resources in China's economic life cannot be ignored because of negative factors such as risks.
Four, familiar with and master the characteristics and operating rules of offshore financial market, and in line with relevant international practices is the principle and starting point for our effective supervision of offshore financial business.
Since the formation of European money market, offshore financial market has gone through half a century. During this period, the major offshore financial markets in the world gradually differentiated, forming four regulatory models. Their respective characteristics are shown in Table 2.
Table 2 Supervision Mode of International Offshore Financial Market
Typical market characteristics of the model
There is no separate offshore account in London and Hongkong, which operates together with onshore accounts, with unrestricted access to funds and equality between residents and non-residents.
Separation of IBF inside and outside the United States
JOM in Japan
Offshore business can only be conducted in a special account (IBF). Offshore transactions are separated from onshore transactions, and the infiltration of offshore onshore funds is strictly prohibited.
Tax Avoidance Cayman, Bahamas Bermuda and BVI Paper Company (Shell Branch) are common law systems with low taxes and basically no control.
Infiltrate Jakarta and Bangkok
There are three kinds of ACU in Singapore: out → in, in → out, in = out.
Now let's analyze which model is more suitable for China today.
Let's look at "internal and external integration" first. Its characteristics tell us that this kind of supervision mode needs very high supervision ability and market maturity. In this mode, there is no obvious difference between offshore account and onshore accounts, and funds can flow freely. In essence, the domestic monetary capital account is completely open and in line with the international market. This is obviously not suitable for China, where foreign exchange control is still implemented and there is still a timetable for opening up under capital.
Let's look at the "internal and external separation" mode, strictly distinguish between onshore accounts and offshore account, prohibit the free exchange of offshore and onshore funds, and separate the offshore market from separate supervision. At present, this kind of supervision mode is adopted in the pilot of offshore banks in China-"offshore account and onshore accounts are strictly distinguished, and offshore funds and onshore funds of banks shall not offset each other".
The question now is: Is this "isolated" supervision effective? Does this simple management mean the loss of huge opportunity cost of the overall economy? Do you want to continue this supervision mode?
One thing we have to admit is that in the early days of offshore banks, everyone crossed the river by feeling the stones. The conservative and isolated supervision of the central bank reduced the possible risks caused by "ignorance" to a certain extent and was a necessary protection for new things. However, with the continuous development of offshore business, the effectiveness and dynamic role of this "isolated" supervision has been questioned. Experience tells us that as long as the costs and benefits of offshore funds and onshore funds are different, the effect of isolation strategy is relative and limited. Because the funds in the market, like water, need a "moth-sucking pipe" to flow in a balanced way, and the mutual penetration of funds in different fields is a natural need, which is eternal and absolute. According to the data of relevant projects of the Ministry of Commerce (Mei Xinyu. 2004), about 300? In the case of huge capital flight of 50 billion dollars, it is still an important task for China's foreign exchange management authorities to crack down on arbitrage. Capital flight means that onshore funds are transferred to the offshore market through illegal channels, and a large number of overseas banks and overseas accounts can make these funds "legally" live abroad. On the other hand, due to the "profit-seeking" nature of capital, it is not restricted by any conditions. As long as the capital price in Chinese mainland market can meet the minimum requirements of capital cross-border flow and investment income for capital transfer, the above-mentioned fleeing huge capital may be attracted back to China market. Recently, due to the expectation of RMB appreciation, a large number of fleeing capital "absconded" to return to China, which shows that in China, where foreign exchange control is implemented, the isolated supervision of offshore business is limited or partially ineffective.
The Mundell-Fleming model holds that it is impossible for a country to achieve the independence of monetary policy, fixed exchange rate and capital control at the same time. At present, the RMB exchange rate in China is nominally "managed floating", but in essence it is pegged to the US dollar. For a long time, we have implemented a fixed exchange rate, so in the case that the independence of RMB policy is beyond doubt and a fixed exchange rate is implemented, the cross-border flow of capital is inevitable in theory. This shows from another angle that isolated supervision is unrealistic for foreign exchange control countries, and further requires us to keep pace with the times and take the road of "moderate penetration" in offshore business management. In the final analysis, Dayu's water control is "it is better to be sparse than to wear a hundred paces", and so is capital control. Even if the RMB really realizes "elastic floating" in the near future, the relaxation of capital controls is the general trend. At present, the outstanding problem is that the "foreign investment approval authority" has seriously hindered the pace of China enterprises going abroad and greatly weakened the competitiveness of China enterprises in the field of international investment and trade. With the increasing of foreign exchange reserves and the influx of short-term capital, strictly controlling the inflow of short-term capital and relaxing the outflow of capital should be the current policy direction of foreign exchange control.
The example of "ACU" account in Singapore can give us some enlightenment: when attracting short-term and medium-and long-term international capital to focus on domestic demand, we can appropriately liberalize the "out → in" account transactions, so that international offshore capital can be included in the scope of supervision in terms of scale, time, investment period and investment field; When domestic capital mainly needs to go abroad, let go of the "in → out" transaction, reasonably guide foreign investment, and promote the facilitation of international investment.
Theoretical analysis and foreign experience tell us that it is necessary for the regulatory authorities to adopt a "moderate penetration" regulatory model at this stage, and adopt a "scientific supervision, strict supervision and gradual relaxation" regulatory approach to offshore business. The author believes that the method of "making use of the situation and combining unblocking" is the most effective and operational management mode for offshore international capital at present.
Verb (abbreviation of verb) The choice of offshore financial supervision mode in China: We should consider changing from "strict isolation" to "moderate penetration".
China's offshore financial business itself is a part of the international offshore financial market, and internationalization is its essence and characteristic. International offshore financial markets have their own systems and practices. From the origin and development of the international offshore financial market, we can see that the international offshore financial market has two basic characteristics:
The first is to evade supervision. The formation of offshore financial market is the result of evading supervision. Avoiding supervision is the premise of the existence of offshore financial market and the biggest driving force for the innovation and development of offshore financial market. Without supervision, there will be no relaxation, and there will be no escape from offshore markets outside supervision. As long as there are access control, credit control, interest rate control and foreign exchange control in onshore business, there will be corresponding offshore markets to escape these controls. Therefore, it is futile and unrealistic to try to bring offshore business into onshore supervision, which violates the objective essence of offshore market evading supervision.
The second is the liberalization of operations. Offshore financial market is a "quite free" market. There is no unified regulatory body and regulatory rules in the world. Its operation completely follows the rules of the free market, with no market restrictions and market access, no credit interest rate control, foreign exchange control and basically no tax control. It has absolute independent innovation ability in providing products and services. As long as you can find financial demanders in the offshore market, you can innovate any financial supply at any time. For example, in the offshore syndicated loan market, in addition to the necessary legal documents, the amount of a syndicated loan can be freely determined, and the interest rate can be freely negotiated. Even the loan method, risk protection, capital use, repayment method and legal text are discussed one by one, and there are established norms from beginning to end, including arrangement, distribution and transfer. Offshore financial market is the biggest testing ground and model room for financial liberalization.
When formulating regulatory policies, we must fully study the above characteristics and laws of offshore financial markets, break through onshore thinking and determine effective regulatory measures, rather than rigid approval and audit systems.
Six, some suggestions on the key points of offshore financial supervision under the current economic situation.
With the acceleration of economic opening and internationalization, the problems faced by Chinese mainland's offshore business and offshore finance will become more and more complicated. Under the background of economic financialization and financial globalization, as well as the existing domestic capital account control and RMB foreign exchange control, we believe that the China government's supervision of offshore financial business should focus on the following aspects:
(1) The financial supervision department should focus on strengthening the management and supervision of the market access of offshore banking institutions and the risk supervision of offshore banks. In terms of market access, first of all, all financial institutions engaged in non-resident business should be included in the scope of supervision. No matter foreign banks, Chinese banks, joint venture banks or other financial institutions, as long as they engage in non-resident business, they should be included in the supervision, and institutions that have not obtained licenses should be ordered to stop operating beyond the scope; Secondly, straighten out policies, implement national treatment for Chinese and foreign-funded offshore financial institutions, and establish the regulatory concept of "the same license, the same policy and the same treatment". As far as risk supervision of offshore banks is concerned, we should pay attention to the following points:
1. Capital adequacy ratio should be the core of supervision. This is the ultimate line of defense for offshore financial institutions to resist risks, and it is also a comprehensive indicator of supervision. It is suggested that the authorized capital of offshore business should be approved under the premise of unified supervision of corporate capital, so as to measure the scale and quality control scope of offshore business.
2. The liquidity of funds is the focus of supervision. At present, the offshore business has reflected the characteristics of wholesale, that is, "big inflow and big outflow", so monitoring the liquidity index of offshore banks is the need to ensure the daily normal operation of offshore banks.
3. Strengthen the supervision of non-performing assets. While historical non-performing offshore assets are required to decrease year by year, offshore banks should be strictly required to control the non-performing rate of new assets. The regulatory authorities should not restrict the offshore business fields and business varieties because of the high non-performing rate of offshore assets, and should implement prudent supervision of offshore assets on the basis of accepting international practices and the concept of business liberalization.
4. Strict supervision and inspection. While strengthening on-site supervision, we should attach importance to off-site supervision, guide commercial banks to establish and improve the internal control system of offshore business, and urge commercial banks to improve their due diligence ability and level.
(2) The focus of foreign exchange supervision should be on the effective implementation of residents' foreign exchange control policies, and the scope of supervision should not be extended to overseas non-residents. Capital account is the focus of foreign exchange supervision at present, and at the same time, it is necessary to prevent the illegal flow of capital mixture under current account. To this end, first, strictly monitor the international offshore short-term capital inflow, mainly monitoring the review of residents' foreign exchange collection accounts and their uses; Second, to manage capital outflow well, we should not only crack down on illegal arbitrage of foreign exchange evasion, but also encourage residents to make reasonable capital expenditures for foreign investment; Third, strictly control business policies, adjust the relevant policies of "in → out" and "out → in" transactions of offshore assets cross-border flow according to the situation and time, and shut out major international economic and financial risks. For example, in the near future, we should focus on the impact of international offshore funds flowing into the domestic currency market on the RMB exchange rate and the impact of the real estate market on real estate prices.
(3) The focus of tax supervision is the legitimacy and rationality of residents' foreign transactions. Offshore companies enjoy relevant tax preferences in the place of registration, which is beyond the scope of management and regulation of China's tax law. Therefore, the focus of tax supervision should be on transactions between onshore companies and offshore companies, especially related transactions. In addition to examining the authenticity and legality of offshore and onshore transactions, we should also focus on supervising transaction prices to prevent tax evasion through "AG, low price" transfer pricing. At the same time, we should reform the tax system on the basis of international tax practices, establish China's "APA" and establish an international consultation mechanism for tax collection and management.
(4) Strengthen the study and research on international practices, and appropriately translate international practices into domestic legislation. Supervisors and offshore employees should master relevant overseas legal knowledge, appropriately introduce overseas professional lawyers and other intermediaries, and outsource legal review procedures. It is a long-term process to transform WTO rules and international practices into domestic systems, and it is also a major issue that needs to be studied.