LehmanBrown: China accountants, Beijing accountants, Shanghai accountants, Hong Kong accountants, Guangzhou accountants, China accounting services, China audit,China consulting, China taxation, China due diligence, taxation, legal services,company setup, recruitment, financial accounting, chief financial officer,bookkeeping, office administration, payroll, company policies and procedures,management accounting, market growth strategy, learning centre, cash flow management, cashflow, business strategy, systems solutions, efficiency improvement services, management information systems, process reviews, business management services, management consulting, corporate finance, market entry strategy, mergers and acquisitions, business due diligence, financial due diligence, business investigation, investor relations, divestitures, turnarounds,business broking.

Foreign Exchange FAQ's

What rules have been issued regarding the repayment of Forex loans?

The People's Bank of China (PBOC) and SAFE issued the Urgent Notice on the prohibition of the Prepayment of Forex Loans in August 1998 making it illegal for Chinese companies (including FIEs) to purchase Forex with RMB for the early repayment of Forex loans.

Furthermore, in the absence of prepayment provisions in the loan agreement, prepayments are prohibited. If prepayments are provided for, they may be made only with a lender's own Forex reserves. However, it is unclear under the new rules whether or not the acceleration of a loan by a lender will be viewed as prepayment. Since the new regulations neglect to deal with the issue of acceleration, foreign lenders may have reason to be concerned about their ability to achieve early loan repayment in default situations.


	© 2005 LehmanBrown Site Map \| Terms of Use & Disclaimers \| Privacy Policy All rights reserved