Notice of Shanghai Municipal People’s Government on Printing and Distributing the Trial Procedures of Shanghai Municipality on the Administration of Financing Guarantee Company
(August 31, 2010)
SMPG G [2010] No. 31
Attention: all District and County People’s Governments, and all relevant Commissions, Offices and Bureaus (Administrations) of the Municipal People’s Government:
We hereby print and distribute the Trial Procedures of Shanghai Municipality on the Administration of Financing Guarantee Company to you, and request you to implement them conscientiously.
Trial Procedures of Shanghai Municipality on the Administration of Financing Guarantee Company
With a view to bringing the important function of financing guarantee in small and medium-sized enterprises’ financing into full play, enhancing the supervision and administration over financing guarantee companies, regulating the financing guarantee activities, and promoting the healthy development of the financing guarantee industry in this Municipality, these Trial Procedures are formulated in accordance with the Company Law of the People’s Republic of China, the Guaranty Law of the People’s Republic of China, the Contract Law of the People’s Republic of China, and the Interim Measures on the Administration of Financing Guarantee Company (BR D [2010] No.3), and in the light of the actual circumstances of this Municipality.
I. Application Scope
1. These Trial Procedures apply to the activities of establishing financing guarantee companies, conducting financing guarantee business, and relevant management work within the jurisdiction of this Municipality.
2. The financing guarantee mentioned in these Trial Procedures refers to the guarantor’s act of promising to bear the contracted guarantee liability to the banking financial institutions or other obligees in the premise that the guaranteed person fails to perform the financing liability to the obligees.
3. The financing guarantee company mentioned in these Trial Procedures refers to those limited liability companies or incorporated companies established in accordance with the law, and engaging in financing guarantee business.
II. General Requirements
1. The financing guarantee company shall follow the principles of “being honest and trustworthy, competing fair, pursuant to laws and regulations” in operation, and pay attention to safety, liquidity and profitability, so as to play an active role in promoting the development of small and medium-sized enterprises.
2. Relevant departments of this Municipality and the district/county people’s governments shall join forces to further enhance the policy support and services and create good conditions for the sustained and healthy development of financing guarantee companies.
3. The mechanism of “department cooperation and joint action of the Municipality and the district/county” is adopted for the supervision of the financing guarantee companies in this Municipality. Relevant departments shall earnestly perform the duties, and do well such work concerning the financing guarantee companies as routine supervision, risk prevention, control and disposal, so as to ensure the healthy and steady development of the financing guarantee industry.
III. Working Mechanism
1. The Shanghai Joint Meeting for the Normalization, Development and Business Supervision of Financing Guarantee Industry (hereinafter referred to as the municipal joint meeting) shall be established. The leaders in charge of the Municipal People’s Government shall take the lead in convening the municipal joint meeting, and the member units include the Municipal Office of Finance Service, the Shanghai Office of the China Banking Regulatory Commission, the Municipal Development & Reform Commission, the Municipal Commission of Economy and Informatization, the Municipal Finance Bureau, the Municipal Administration of Local Taxation, the Municipal Commission of Commerce, the Shanghai Branch of the People’s Bank of China, the Municipal Administration of Industry and Commerce, the Municipal Public Security Bureau, the Municipal Agricultural Commission, the Municipal Housing Support and Building Administration Bureau, the Municipal Urban Planning, Land and Resources Administration, and the Legislative Affairs Office of the Municipal People’s Government. The office of the municipal joint meeting will be set up in the Municipal Office of Finance Service.
The municipal joint meeting mainly assumes two functions:
(1) to guide the normalization and development of the financing guarantee industry, deliberating and deciding major matters concerning the industry supervision; and
(2) to encourage the financing guarantee industry of this Municipality to further support and serve the small and medium-sized enterprises in financing; study and formulate policies and measures to promote the development of the industry; guide and encourage the district/county people’s governments in carrying out the work concerning financing guarantee; establish and improve a scientific and reasonable performance evaluation and comprehensive appraisal mechanism for policy-oriented financing guarantee business; coordinate in solving problems incurred in the development of the financing guarantee industry.
The member units of the municipal joint meeting shall perform their respective duties, and join forces to promote the healthy development of the financing guarantee industry in this Municipality.
2. Being the supervisory department of the financing guarantee companies and business of this Municipality, the Municipal Office of Finance Service shall implement administrative license on financing guarantee companies and business of this Municipality, issue and administrate business certificates, take charge of the entry, withdrawal, routine supervision, and risk disposal of the financing guarantee companies of this Municipality, and report to the Inter-ministerial Joint Meeting of Supervision over Financing Guarantee Business (hereinafter referred to as the inter-ministerial joint meeting); submit in a timely manner the statistical statement and organization overview of the financing guarantee industry of this Municipality, and the report on annual development of and supervision over the financing guarantee industry in accordance with the requirements; keep track of the business risk of financing guarantee of this Municipality.
The Municipal Office of Finance Service shall provide the district/county with guidance for carrying out the work related to financing guarantee.
3. The district/county people’s government shall submit to the Municipal Office of Finance Service the application report for carrying out the administration on financing guarantee business, and take charge of the start-up preliminary examination and risk disposal of the financing guarantee companies registered in its own jurisdiction after the report is submitted to the municipal joint meeting by the Municipal Office of Finance Service and is approved by the municipal joint meeting; do well the routine supervision over the financing guarantee companies registered in its own jurisdiction under the guidance of the Municipal Office of Finance Service, and submit its work report to the municipal joint meeting and its office.
The district/county people’s government shall assign a competent administrative department and fulltime staffs, and earnestly undertake the duties of administration.
IV. Establishment, Alteration and Termination
1. Establishment of the company
(1) Where a financing guarantee company is to be established in this Municipality, it shall be initiated by one or two corporate entity (ies) or natural person(s) as the main sponsor.
As a main sponsor, the corporate entity shall meet the following requirements:
A. has normalized management, good reputation, and enormous potentiality; and
B. operates for three or more years, and obtains profits in the last two consecutive account years; the accumulative net profit of last three years is not less than 10 million yuan, the asset-liability ration is not more than 70%, the net assets is not less than 50 million yuan, and as a principle, the long-term investment amount shall not exceed 60% of the net assets after this investment.
As a main sponsor, the natural person shall meet the following requirements:
A. has the economic strength of sponsoring the investment; has certain industry background and influence in the industry; can provide corresponding valid proof; and
B. has no significant adverse credit history, no significant adverse employment history, and no criminal records.
(2) The minimum registered capital for establishing a financing guarantee company in this Municipality is 100 million yuan. The registered capital shall be the paid-in money-capital. As for those financing guarantee companies under the guidance of the district/county people’s government with the purpose of mainly providing financing guarantee services to the small and medium-sized enterprises within the jurisdiction, the requirements on registered capital may be appropriately lowered.
Where the company is initiated by a single corporate entity as the main sponsor, its shareholding ratio shall not be lower than 30% in principle; where the company is initiated by two corporate entities as the main sponsor, the shareholding ratio of each party shall not be lower than 20% in principle; where a natural person initiates a company as the main sponsor, he/she shall have the equity up to certain ratio.
An ordinary sponsor shall have certain industry background, sustainable investment capacity and risk tolerance capacity, and its contribution shall not be less than five million yuan in principle.
(3) To establish a financing guarantee company, the following conditions shall be met:
A. the main sponsors and ordinary sponsors shall meet the conditions provided in the preceding clauses;
B. the articles of association shall meet the provisions of the Company Law of the People’s Republic of China;
C. some/all shareholders have sustainable investment capacity;
D. the registered capitals shall meet the provisions of these Trial Procedures;
E. the company has qualified directors, supervisors, senior managers, and qualified employees;
F. the company has perfect organizational structure, internal control and risk management system;
G. the business place of the company shall meet the requirements; and
H. other prudential conditions.
(4) The directors, supervisors and senior managers shall be qualified as provided by the inter-ministerial joint meeting, observe laws and disciplines, be honest and trustworthy, and have corresponding professional knowledge, work experience, and organization and management capacity that are necessary for the post.
(5) The employees shall participate in special trainings on guarantee or finance, have corresponding professional skills that are necessary for the post, and have good sense of legal compliance and prudent operation.
(6) Where a financing guarantee company is to be established, the main sponsor(s) shall submit the application materials to the local district/county people’s government where the company is to be registered. The application materials include:
A. application：the name, business place, registered capitals and business scope of the financing guarantee company that is to be established shall be listed in the application;
B. feasibility report;
C. articles of association (draft);
D. register of the shareholders, investment amount and ownership structure;
E. capital verification certificates of shareholder’s contribution, credit standing certificates of shareholders and relevant materials;
F. resume and qualification certificate of the purposed directors, supervisors and senior managers;
G. strategy and planning of management and development;
H. certification and/or evidence of business place;
I. legal opinion issued by a law firm and audit report issued by an accounting firm; and
J. other documents and materials that shall be submitted.
The district/county people’s government engaging in the administration of financing guarantee business shall carry out preliminary examination on the above-mentioned materials in accordance with the requirements, and upon the passing of the preliminary examination, submit the application materials and preliminary examination opinions to the Municipal Office of Finance Service. The Municipal Office of Finance Service shall issue the approval document upon reaching the conclusion that all relevant provisions are met after soliciting the opinions of relevant member units of the municipal joint meeting.
(7) The applicant shall accomplish the preparatory work within six months form the date of obtaining the approval document from the Municipal Office of Finance Service. Where the applicant fails to accomplish the preparatory work within the prescribed time limit, the corresponding reasons shall be stated, and the time limit may be appropriately extended where the case is examined and verified by the competent administrative department of the local district/county, and approved by the Municipal Office of Finance Service. Where the applicant fails to accomplish the preparatory work within the extended period, the original approval document of the Municipal Office of Finance Service shall automatically become void.
The preparatory institution shall not engage in financing guarantee business of any kind.
(8) After the completion of the preparatory work, the applicant shall send a written report to the district/county competent administrative department for preliminary acceptance. Where the preliminary acceptance is approved, the district/county competent administrative department shall send a written report to the Municipal Office of Finance Service for formal acceptance. Where the formal acceptance check is approved, the Municipal Office of Finance Service shall make an official reply approving the start of operation of the financing guarantee company, and issue the business certificate of a financing guarantee company. The financing guarantee company that is approved to start operation shall apply to the industry and commerce department for registration against the approval document and the business certificate.
Where the financing guarantee company fails, without proper reasons, to go through registration formalities with the industry and commerce department within three months from the date of obtaining it, the original business certificate issued by the Municipal Office of Finance Service shall become void automatically.
The specific time limit of examination and approval of the district/county competent administrative department and the Municipal Office of Finance Service on the application shall follow relevant provisions of the Administrative License Law of the People’s Republic of China.
The name of the financing guarantee company that is approved to be established shall be composed of such elements in proper order as the administrative division, shop name, industry description, form of organization, among which, the administrative division is “Shanghai”, the shop name shall be decided by the company, the industry description shall clearly be marked with the words “Finance Guarantee” or “Financing Guarantee”, and the type of organization is limited liability company or incorporated company. The words “Finance Guarantee” or “Financing Guarantee” shall not be used in the name without approval.
2. Set-up of branch office
(1) Where a financing guarantee company registered in this Municipality intends to set up a branch office in/out of this Municipality, the following conditions shall be met:
A. the registered capital shall not be less than 300 million yuan;
B. the company operates for three or more years, and obtains profits in the last two consecutive account years;
C. the company operates steadily and compliant to laws and regulations, and has no bad records of breaking the laws or violating the regulations;
D. registered capitals shall be added correspondingly by the financing guarantee company for each newly established branch office; and
E. other relevant conditions.
Where a financing guarantee company registered in other provinces or cities intends to set up a branch office in this Municipality, the preceding clause shall be followed in principle. Operating capitals shall be allocated correspondingly for each newly established branch office.
(2) Where a financing guarantee company registered in this Municipality intends to set up a branch office in other provinces or cities, it shall report to the district/county competent administrative department where the financing guarantee company is located for the record, report to the Municipal Office of Finance Service for approval, and report to the provincial-level supervisory department where the proposed branch office is located for examination and approval.
(3) Where a financing guarantee company registered in other provinces or cities intends to set up a branch office in this Municipality, it shall obtain the approval of the provincial-level supervisory department where the financing guarantee company is located, report to the district/county people’s government where the proposed branch office is located for preliminary examination, and report to the Municipal Office of Finance Service for examination and approval.
The relevant provisions of these Trial Procedures on setting up a company shall be referred to for the specific application procedures of setting up the branch office.
3. Alteration and termination
(1) Where one of the following items is changed, the financing guarantee company shall apply to the district/county competent administrative department for a preliminary examination:
A. change of the name;
B. alteration of the form of organization;
C. alteration of the registered capital;
D. alteration of business place of the company;
E. adjustment of business scope;
F. alteration of directors, supervisors or senior managers;
G. alteration of shareholders holding at least 5% of its total shares;
H. division or merger;
I. amendment of articles of associations; or
J. other alterations as provided.
Where the preliminary examination is passed, the district/county competent administrative department shall submit the application materials of the financing guarantee company concerning the alteration, and the corresponding opinions of preliminary examination to the Municipal Office of Finance Service for examination and approval.
Where the altered item of the financing guarantee company involves registration, the financing guarantee company shall apply to the industry and commerce department for the alteration of registration as provided upon the approval of the Municipal Office of Finance Service.
(2) Where the financing guarantee company is to be dissolved because of separation, merger, or occurrence of the dissolution conditions provided by the articles of association, the case shall be reported to the district/county competent administrative department for preliminary examination, and reported to the district/county people’s government after the preliminary examination is passed. The district/county people’s government shall report the case to the Municipal Office of Finance Service for examination and approval, and upon the approval of the Municipal Office of Finance Service, the guarantee financing company shall apply to the industry and commerce department in a timely manner to go through relevant registration formalities against the approval document.
(3) Where the financing guarantee company has major illegal business activities, and the fact of failing to cancel the company will seriously endanger the market order, or harm the public interests, the supervisory department shall cancel the company, unless otherwise provided by laws and administrative regulations.
(4) Where a financing guarantee company is to be dissolved or cancelled, a liquidation group shall be formed according to the law, and shall pay relevant debts in a timely manner according to the debt liquidation plan. The Municipal Office of Finance Service and the district/county competent administrative department shall guide and supervise the liquidation process.
Prior to the release of the guarantee liability, the shareholders of the company shall not distribute the company’s assets or properties or obtain any interests or benefits from the company.
(5) Where a financing guarantee company fails to pay its due debts, and becomes insolvent to settle all debts or obviously lacks the solvency, it shall go through the bankruptcy procedures according to the law.
V. Business Scope
1. The financing guarantee company may engage in some or all of the following financing guarantee business upon the approval of the Municipal Office of Finance Service:
(1) loan guarantee;
(2) bill acceptance guarantee;
(3) trade financing guarantee;
(4) project financing guarantee;
(5) L/C guarantee; and
(6) other financing guarantee business.
2. The financing guarantee company may concurrently engage in some or all of the following business upon the approval of the Municipal Office of Finance Service:
(1) guarantee of preservation under a lawsuit;
(2) performance guarantee business such as tender guarantee, advance payment guarantee, project performance guarantee, payment guarantee of the remaining balance;
(3) intermediary services related to the guarantee business such as financing consultation and financial consultant;
(4) investment with its own capitals; and
(5) other business as provided.
3. The financing guarantee company may provide re-guarantee for the guarantee liability of any other financing guarantee company, and handle the bond issuance guarantee business, in the premise that the following conditions are met:
(1) the registered capital shall not be less than 300 million yuan;
(2) the company operates consecutively for not less than two years;
(3) the company has no bad records such as breaking the laws or violating the regulations for the last two years; and
(4) other conditions as provided.
4. The financing guarantee company shall not engage in any of the following activities:
(1) accepting deposit;
(2) offering loans;
(3) being entrusted to offer loans;
(4) being entrusted to make investment; or
(5) other activities prohibited as provided.
VI. Risk Control
1. The financing guarantee company shall establish and perfect the corporate governance, and perfect the rules of procedure, decision-making procedures, and internal auditing system; establish the business operation procedures, decision-making procedures, follow-up supervision mechanism, and risk warning and disposal mechanism that meet the principle of prudent operation.
2. The financing guarantee company shall establish and perfect the financial and accounting system in accordance with the requirements of the financial rules of financial enterprises and the accounting standards for business enterprises, and truthfully and accurately record and reflect the enterprise’s financial position, operating results and cash flows.
3. The guarantee fees collected by a financing guarantee company may be determined through negotiation between the financing guarantee company and the guaranteed party at their own discretion in accordance with the risk degree of the project guaranteed, but it shall not violate relevant regulations of the State.
4. The financing guarantee liability balance to a single guaranteed party by a financing guarantee company shall not be more than 10％ of its net assets; the financing guarantee liability balance to a single guaranteed party and its affiliated party shall not be more than 15％ of its net assets; the financing guarantee liability balance to a single guaranteed party for bond issuance shall not be more than 30％ of its net assets.
5. The financing guarantee liability balance of a financing guarantee company shall not be more than ten times of its net assets, unless otherwise provided by the State.
6. The investment conducted by a financing guarantee company with its own capital shall be limited to such fixed-income financial products with comparatively high credit ratings as treasury bonds, financial bonds, debt financing instruments of large enterprises, and other investments that have no conflict of interest while the total amount is not more than 20% of the net assets.
7. A financing guarantee company shall not provide financing guarantee to its parent company or subsidiary company.
8. A financing guarantee company shall allocate 50% of its guarantee income as its unearned premium reserve, and also allocate the indemnity reserve at the proportion of not less than 1% of the guarantee balance at the end of the current year. Where the accumulated indemnity reserve accounts for not less than 10% of the total guarantee balance of the current year, the method of surplus allocation shall be adopted.
9. A financing guarantee company shall conduct risk classification management of its guarantee liabilities, and measure its guarantee liability risks exactly and accurately.
VII. Supervision and Administration
The Municipal Office of Finance Service shall, jointly with relevant member units of the municipal joint meeting, do a good job of the supervision over the financing guarantee companies and business in this Municipality. The district/county competent administrative departments shall be responsible for the routine supervision, statistics, summarization and analysis of those financing guarantee companies registered within their respective jurisdictions.
The supervision contents include off-site supervision, on-spot inspection, information disclosure, report of major risks, and emergency management.
1. Off-site supervision
(1) An information system for the administration of financing guarantee companies shall be established; the information submission, business situation, credit standing, supervision situation, risk warning, and other information of the financing guarantee companies of the whole Municipality and their branch offices shall be brought into this system so as to realize the comprehensive administration.
(2) The district/county competent administrative department shall, in accordance with the requirements of these Trial Procedures, establish and perfect the systems of collection, collation and statistical analysis of the information and materials of the financing guarantee companies, and the supervisory points system to conduct the continuous monitoring over the operation and risk situations, and do a good job of routine off-site supervision. The district/county competent administrative department shall comprehensively analyze and evaluate the annual development and supervision situation of the financing guarantee industry within its jurisdiction at the end of each year, and submit the report on the previous year’s development and supervision of the financing guarantee industry within its jurisdiction to the district/county people’s government and the Municipal Office of Finance Service before the end of each January; complete the previous year’s institutional overview reports on the financing guarantee companies under supervision before the end of each March.
(3) The financing guarantee company shall submit the business report and financial and accounting statement of the last month to the district/county competent administrative department before the 10th of each month; submit the report on legal compliance operation and utilization of capitals of the last quarter to the district/county competent administrative department before the 15th of the first month of each quarter. The district/county competent administrative department shall submit the above-mentioned materials to the Municipal Office of Finance Service within 5 days upon the receipt of the same.
The Municipal Office of Finance Service shall put forward the requirements on the capital quality and the capital adequacy ratio of the financing guarantee companies in good time in accordance with the needs of the prudent supervision.
(4) After the establishment and operation of the financing guarantee company, the bank that has cooperative relationship with such company shall conduct real-time monitoring on relevant capital flows, and report the unusual situation to relevant departments in a timely manner.
(5) The Municipal Office of Finance Service and the district/county competent administrative department are entitled to ask the financing guarantee companies to provide specific information, or make an appointment with the director(s), supervisor(s) or senior manager(s) for a supervisory interview, and ask for explanation on relevant situations and problems, or for necessary rectification and improvement according to supervisory requirements. In case of necessary, the Municipal Office of Finance Service and the district/county competent administrative department may notify the creditor of the irregularities or risks of the financing guarantee company under supervision.
(6) The Municipal Office of Finance Service and the Municipal Administration of Industry and Commerce shall, in accordance with their respective duties, conduct annual examination and annual inspection on the status of operation of the financing guarantee company.
2. On-spot inspection
(1) The Municipal Office of Finance Service and the district/county competent administrative department may conduct on-spot inspection over the financing guarantee companies according to supervisory requirements, and the financing guarantee companies shall cooperate and provide relevant documents and materials in accordance with the requirements. The on-spot inspection shall be conducted by at least two inspectors, who shall present the notice of inspection and relevant credentials to the financing guarantee companies on the spot.
(2) In case of necessary, the Municipal Office of Finance Service and the district/county competent administrative department may employ accounting firms, law firms, credit rating institutions, or other social intermediaries to carry out special audit, due diligence or credit rating on financing guarantee companies, and report the results to the municipal joint meeting.
3. Information disclosure
(1) The financing guarantee company shall establish the information disclosure system, and regularly make public the information concerning finance and operation to the Municipal Office of Finance Service, the district/county competent administrative department, shareholders and cooperative banks of the company.
(2) The financing guarantee company shall report in a timely manner to the Municipal Office of Finance Service and the district/county competent administrative department those important resolutions of the general meetings of shareholders, shareholder meetings, and directors’ meetings.
4. Report of major risks and emergency management
(1) The Municipal Office of Finance Service and the district/county competent administrative department shall establish the emergency management mechanism for major unexpected risks, establish the discovery-report-disposal system for emergencies in the financing guarantee industry, draw up emergency response planning for the financing guarantee industry and make clear the handling organ and its duties, handling measures and procedures, so as to promptly and effectively handle the emergencies in the financing guarantee industry.
(2) The financing guarantee company shall submit the briefing to the district/county competent administrative department within three hours from the occurrence of major risks, and report in detail within 12 hours. According to relevant provisions of the inter-ministerial joint meeting, the major risks include:
A. mass disturbances incurred by the financing guarantee company;
B. the financing guarantee company involves in guarantee fraud, or guarantee compensation or investment losses amounting to 5% or more of its net assets;
C. the due major claims of the financing guarantee company are not paid off, which causes illiquidity or insolvency;
D. main assets of the financing guarantee company are sealed up, detained, or frozen;
E. the financing guarantee company is suspected of noncompliance, and investigated by the administrative agencies or judicial organs;
F. the major contributor of the financing guarantee company engages in false capital contribution, or flight of capital contribution or the major contributor causes other significant adverse effects to the company;
G. 1/2 or more directors, supervisors or senior managers of the financing guarantee company resign within three months;
H. the major principals of the financing guarantee company disappears, dies abnormally, or is taken through coercive measures by judicial organs in accordance with the law; or
I. other situations that shall be reported.
(3) The district/county competent administrative department shall make accurate judgment on the nature, trend and risk degree of the major risks of the financing guarantee company occurred within its jurisdiction, report to the district/county people’s government in a timely manner those major risks that may endanger the financial order, affect the social stability, or induce the systematic risks, properly handle the case in accordance with relevant provisions, and report to the Municipal Office of Finance Service at the same time.
(4) The Municipal Office of Finance Service shall, jointly with relevant parties, promptly handle major risks of the financing guarantee industry of this Municipality in accordance with the provisions, and report to the municipal joint meeting and the inter-ministerial joint meeting in a timely manner.
VIII. Legal Liability
The act of violating laws or regulations shall be handled in accordance with the provisions of relevant laws and regulations, and the Interim Procedures on the Administration of Financing Guarantee Company.
1. The person who engages in the supervision over the financing guarantee company of this Municipality and has any of the following acts shall be given administrative sanctions; where the act constitutes a crime, the wrongdoer shall be prosecuted for criminal liability in accordance with the law:
(1) violating the provisions in examining and approving the establishment, alteration, termination, and business scope of a financing guarantee company;
(2) violating the provisions in conducting the on-spot inspection on a financing guarantee company;
(3) failing to report major risks and the related responses in accordance with the relevant provisions; or
(4) other acts violating the laws, regulations or relevant provisions.
2. Where the financing guarantee company violates the provisions of relevant laws or regulations or the Interim Procedures on the Administration of Financing Guarantee Company, and where such laws or regulations have corresponding provisions on punishment, the company shall be punished in accordance with such provisions; where such laws or regulations have no corresponding provisions on punishment, the Municipal Office of Finance Service shall order a rectification, and may give warnings or impose fines; where the act constitutes a crime, the wrongdoer shall be prosecuted for criminal liability in accordance with the law.
3. Those who violate the provision of Article 8 of the Interim Procedures on the Administration of Financing Guarantee Company and engage in financing guarantee business without authorization shall be banned and punished by relevant departments in accordance with the law; those who use the words “Finance Guarantee” or “Financing Guarantee” in their company name without authorization shall be ordered a rectification by the Municipal Office of Finance Service jointly with relevant departments, and be punished in accordance with the law.
IX. Miscellaneous
1. Where an existing financing guarantee company with comparatively strong capital strength, certain scale of business and a leading position in the industry needs to be confirmed of registration in accordance with the provisions, or a financing guarantee company to be set up has main sponsors with strong capital strength and influence in the industry both at home and abroad, it may send its application to the district/county people’s government where the company is located and send the copy to the Municipal Office of Finance Service simultaneously; after the examination and verification by the district/county people’s government and the approval of the Municipal Office of Finance Service, the Municipal Office of Finance Service shall directly attend to the company’s establishment and administration, and the district/county people’s government shall cooperate in the related work.
2. Relevant municipal departments and the district/county people’s governments shall further enhance the supporting strength, and study and formulate policies and measures to promote the healthy and steady development of the financing guarantee industry.
3. The Municipal Trade Association of Guarantee shall enhance the self-construction and the self-discipline management, effectively perform the duties of self-discipline, rights protection, service and guidance, and play an active role in the healthy and orderly development of the financing guarantee industry of this Municipality.
4. The financing guarantee companies with foreign investment shall follow these Trial Procedures and the provisions of available relevant laws and regulations concerning foreign investment. The applicant shall obtain the documents approving the start of the preparations from the Municipal Office of Finance Service, and apply to the supervisory department for acceptance check upon the completion of the preparatory work; the Municipal Office of Finance Service approves the start of operation of the financing guarantee company and issues the business certificate; after the applicant goes through the relevant formalities with the Municipal Commission of Commerce, the industry and commerce department shall complete the registration formalities.
5. Those non-corporate financing guarantee institutions established in this Municipality shall, in principle, be administrated by taking reference to these Trial Procedures.
6. Those financing guarantee companies established before the implementation of these Trail Procedures shall be normalized and rectified in accordance with relevant provisions of the State, and reach the requirements before March 31, 2011.
7. As for those relevant matters not provided in these Trial Procedures, the Interim Procedures on the Administration of Financing Guarantee Company shall prevail.
8. The Municipal Office of Finance Service is responsible for the interpretation of these Trial Procedures.
9. These Trial Procedures shall be effective as of October 1, 2010.