China's National People's Congress Standing Committee is reviewing a draft Financial Law during its June 23-26 session after a public consultation period from March 20 to April 19. The 11-chapter, 95-article proposal would create a foundational framework for the financial sector by consolidating principles now spread across separate banking, securities, insurance and other laws into a unified system.
The draft defines financial activities broadly to include deposits, loans, insurance, securities, futures and derivatives, funds, trusts, payments and credit reporting, and states that all such activities are subject to supervision. It requires approval, registration, filing or other authorization for financial institutions, financial business activities and financial products and services, extends oversight to financial holding companies, non-bank payment institutions and certain third-party service providers, and prohibits structures or marketing practices used to circumvent regulatory requirements.
It confirms the People's Bank of China as the central bank and assigns it responsibility for monetary policy, macroprudential management, financial stability, payment and clearing oversight, statistics and reserve management. The draft also states that the renminbi includes both physical and digital forms.
The proposal sets governance, capital, shareholder and exit requirements for financial institutions, establishes unified standards for markets and financial infrastructure, and provides regulators with investigation and corrective tools. It also formalizes resolution measures including restructuring, takeover, trusteeship, bridge arrangements, write-downs, debt-to-equity conversion, industry protection funds, a financial stability fund and the central bank's lender-of-last-resort role.