The People’s Bank of China recently issued Directive No. 1 of 2019 (the “Directive”) to cancel the enterprise bank account licenses in batches across the entire country beginning from February 25, 2019, and achieve complete cancellation by the end of 2019. Meanwhile, the administration of enterprise bank accounts will be enhanced and both interim and ex post supervision will be strengthened across the board.
According to the Directive, the first batch of license cancellations would take place in Jiangsu and Zhejiang Province, and subsequent areas would be separately decided depending on the preparation status in the other provinces (autonomous regions and municipalities).
The cancellation of enterprise bank account licenses refers to the change from an approval system to a recordation system for applications from legal persons, unincorporated enterprises, and individual industrial and commercial entities looking to establish a basic savings account or temporary savings account at financial institutions in areas where the licensing of enterprise bank accounts is cancelled. As a result, Articles 6, 29, 31, and 38 of the Measures for the Administration of RMB Bank Settlement Accounts (People’s Bank of China Directive No. 5 of 2003) as well as provisions relating to the approval of bank accounts and bank operating licenses (account opening registration certificates) under Articles 18, 19, 21, 23, 28, 32, 36, 54, 55 and 63 of the same will no longer be enforced.