(9) An authorization to the chief representative or general representative, bearing the chairman's signature or president (chief executive officer or general manager) or his authorized person;

(10) The bank's bylaws and rules on anti-money laundering; and

(11) Other materials as required by the CBRC.

Applying for a business license

Obtaining a business license can be broken into two stages. The first stage is submission of a "Preparatory Application," which is essentially an application for permission to actually apply, odd though it may be. The second stage is the true "Application for Establishment." Prior to submitting the preparatory application, one must follow the steps below.

In order to implement the licensing of a foreign-funded bank, the applicant will need to meet the following general provisions set forth in Articles 5-7, which require all materials submitted (except annual statements printed in English) to be accompanied by a Chinese translation, a photocopy of a business license, a notarized letter of guarantee for all tax and debt liabilities, and a notarized letter of good standing from a "competent authority" within the foreign-funded bank's home country. Additionally, Chinese law requires 300 million yuan ($43.8 million) (in order to conduct both foreign currency and renminbi business) as a minimum amount of registered capital.

After meeting these general provisions, the applicant must meet the following conditions, set forth in Article 8:

(1) The investor of the solely-funded or the foreign counterpart of the equity joint bank is a financial institution;

(2) The sole shareholder or largest shareholder of the solely-funded bank shall be a commercial bank with a capital adequacy ratio of no less than 8 percent;

(3) The sole shareholder or largest shareholder of a solely-funded bank shall have a RO in China, which has existed for two years or more. If the sole foreign shareholder or largest foreign shareholder of the equity joint bank is a Hong Kong bank or Macao bank, no RO is required to be established at a first step. The RO established within China refers to one under the supervision of the CBRC;

(4) By the end of the fiscal year prior to the filing of an application, the total assets of the sole shareholder or largest shareholder of the solely-funded bank, or the sole foreign shareholder or largest foreign shareholder of the equity joint bank shall not be less than $10 billion. If the sole shareholder or largest shareholder of the solely-funded bank, or the sole foreign shareholder or largest foreign shareholder of the equity joint bank is a Hong Kong bank or Macao bank, its total assets shall, by the end of the fiscal year prior to the filing of an application, be no less than $6 billion;

(5) The country or region where the investor of a solely-funded bank or the foreign counterpart of an equity joint bank is located has a sound financial regulatory system and the investor of the solely-funded bank or foreign counterpart of the equity joint bank is subject to efficient supervision of the competent authority of the said country or region; and

(6) The competent authority of the country or region where the investor of a solely-funded bank or the foreign counterpart of the equity joint bank is located approves its application.

In Issue No. 39 we will continue with this topic.