Measures of the China Banking and Insurance Regulatory Commission for On-site Inspections (for Trial Implementation)
Measures of the China Banking and Insurance Regulatory Commission for On-site Inspections (for Trial Implementation)
Measures of the China Banking and Insurance Regulatory Commission for On-site Inspections (for Trial Implementation)
Order of the China Banking and Insurance Regulatory Commission [2019] No.7
December 24, 2019
The Measures of the China Banking and Insurance Regulatory Commission for On-site Inspections (for Trial Implementation), which were adopted at the Sixth Commission Affairs Meeting of the China Banking and Insurance Regulatory Commission in 2019, are hereby issued and shall come into effect as of January 28, 2020.
Guo Shuqing, Chairman
Measures of the China Banking and Insurance Regulatory Commission for On-site Inspections (for Trial Implementation)
Chapter I General Provisions
Article 1 These Measures are formulated in accordance with relevant laws and regulations including the Law of the People's Republic of China on Banking Supervision and Administration, the Insurance Law of the People's Republic of China, the Commercial Bank Law of the People's Republic of China with a view to fully implementing the policies and plans of the Central Committee of the Communist Party of China ("CPC") and the State Council on financial work, strengthening the supervision over and administration of the banking and insurance industries, regulating on-site inspection activities, enhancing on-site inspection quality and effect and promoting the sound development of the industries.
Article 2 For the purpose of these Measures, "on-site inspections" refer to the administrative law enforcement activities legally carried out by the China Banking and Insurance Regulatory Commission (hereinafter referred to as the "CBIRC") and its local offices to supervise and inspect the operation and management of banking and insurance institutions.
Article 3 On-site inspection is an important and integral part of the supervision and administration by the CBIRC and its local offices, through giving full play to the role in error detection and irregularity correction, validation and verification, evaluation and guidance, warning and deterrence, etc., with the aim to supervise and urge banking and insurance institutions to implement macro and regulatory policies of the State, raise their operation management level, conduct legitimate and prudent operation, implement their entity responsibilities for risk prevention and control, thus safeguarding the security of the banking and insurance industries, and better serving the development of the real economy.
Article 4 The CBIRC and its local offices shall carry out on-site inspections according to their duties, authority and procedures determined by laws, administrative regulations, rules and normative documents.
Article 5 The CBIRC and its local offices as well as personnel carrying out on-site inspections (hereinafter referred to as "inspectors") shall carry out inspections in accordance with the law, conduct civilized law enforcement, strictly implement the spirit of the eight-point frugality code of the CPC Central Committee, and observe the discipline for confidentiality and clean administration. The CBIRC and its local offices shall strengthen the on-site inspection discipline and the institutional construction for clean administration and enhance the supervision over inspectors' clean administration and duty performance.
Article 6 Where the CBIRC and its local offices carry out on-site inspections in accordance with the law, institutions under inspection and their staff members shall cooperate therewith and ensure the authenticity, accuracy, completeness and timeliness of pertinent documents and materials provided as well as relevant situation reported by them. If an institution under inspection or any of its staff members fails to cooperate in the inspection or authentically report the situation, or refuses or obstructs the inspection, etc., the CBIRC or its local office concerned may, in light of the seriousness of the circumstances, take regulatory measures against and impose administrative punishments on the institution and individual concerned in accordance with the law.
During the inspection, institutions under inspection shall provide necessary office facilities and work support for on-site inspections.
None of institutions under inspection and their staff members may disclose the inspection situation or relevant information to the public without the consent of the CBIRC or its local offices.
Article 7 For the purpose of these Measures, on-site inspections shall include, among others, routine inspections, temporary inspections and audit investigations.
Routine inspections are those included in annual on-site inspection plans, which shall, in light of the inspection scope, be divided into comprehensive inspections over risk management and internal control effectiveness, etc., special inspections over certain business sectors or regions, and follow-up inspections of the implementation of rectification of major problems identified in previous on-site inspections of institutions under inspection.
Temporary inspections are those outside the scope of annual on-site inspection plans that are carried out in line with major work deployments or temporary work tasks.
Audit investigations are the activities in which special investigation of specific matters is carried out according to simplified on-site inspection processes.
Article 8 The CBIRC and its local offices shall establish and improve the on-site inspection management information system to realize the sharing of inspection resources and improve the efficiency of on-site inspections.
Article 9 The CBIRC and its local offices shall prepare budget for the funds for on-site inspection projects in strict accordance with the procedures prescribed by laws and regulations, strengthen budget management and use inspection funds in a compliant manner.
Article 10 The CBIRC and its local offices shall arrange inspection forces commensurate with inspection tasks, strengthen the training of on-site inspection professionals, establish and improve the directory database of random inspectors, refine the expertise fields of talents, raise the on-site inspection level, and take on-site inspections as an important way to foster a team for regulating the banking and insurance industries and to improve the regulatory capacity.
Article 11 All departments and local offices of the CBIRC shall strengthen communication and coordination during on-site inspections and establish effective linkage mechanisms for on-site inspections.
Chapter II Division of Duties
Article 12 In light of the division of regulatory duties, the on-site inspection work of the CBIRC and its local offices shall be subject to hierarchical project establishment and implementation, and on-site inspections shall be carried out as per the working mechanism of "whoever establishes the project and organizes the implementation shall assume the responsibility".
Article 13 The CBIRC shall be responsible for the overall planning for on-site inspection work throughout the system, and in light of the division of regulatory duties, organize on-site inspections of relevant banking and insurance institutions, as well as major special inspections, temporary inspections and audit investigations throughout the system, and conduct overall planning, guidance, assessment and evaluation of on-site inspections carried out by its local offices.
Article 14 All local offices of the CBIRC shall, be responsible for the overall planning for on-site inspection work within their respective jurisdictions and in light of the division of regulatory duties, organize on-site inspections of banking and insurance institutions within their respective jurisdictions, complete the on-site inspection tasks assigned by higher-level departments, and guide, assess and evaluate the on-site inspection work of lower-level departments.
Article 15 The CBIRC may, when needed, directly carry out on-site inspections of institutions under the regulation of banking and insurance regulatory bureaus, and banking and insurance regulatory bureaus may directly carry out on-site inspections of institutions under the regulation of banking and insurance regulatory sub-bureaus within their respective jurisdictions.
Article 16 The on-site inspection departments of the CBIRC and its local offices shall be responsible for the centralized management of on-site inspections.
The departments of the CBIRC and its local offices that undertake on-site inspection tasks shall be responsible for the project establishment, organization and implementation of on-site inspections, put forward suggestions on rectification, adoption of regulatory measures and administrative punishments, evaluate the rectification of institutions under inspection through regulatory talk, follow-up inspection and audit investigation, etc., and promptly communicate with relevant departments on on-site inspections.
Other departments of the CBIRC and its local offices for institutional and functional regulation shall, actively cooperate in carrying out on-site inspections, be responsible for putting forward suggestions on on-site inspection project establishment, strengthen information sharing, and provide data, materials and relevant information required for on-site inspections.
Article 17 The CBIRC and its local offices shall, strengthen the work linkage with relevant government departments to communicate on inspection situations, share inspection information in accordance with the law, and actively explore the use of credit reporting information, industrial and commercial registration information, tax payment information and other external data to assist on-site inspection work; cooperate in the building of a cross-departmental joint spot check mechanism for random selection of both inspectors and inspection targets, and where necessary, work with other departments to carry out on-site inspections of relevant business sectors of banking and insurance institutions.
Article 18 The CBIRC and its local offices shall, in accordance with the provisions of regulatory memorandums and other cooperation agreements and as per the principle of reciprocity, carry out inspections of overseas institutions and businesses of Sino-funded banking and insurance institutions, strengthen the communication and collaboration with overseas regulators, and cooperate with overseas regulators in effectively carrying out inspections of domestic institutions and businesses of foreign-funded banking and insurance institutions.
Chapter III Project Establishment Management
Article 19 The CBIRC and its local offices shall, implement hierarchical project establishment in light of the division of regulatory duties; strengthen the management of on-site inspection project establishment, and in light of the status of legality and compliance, status of rating, degree of system importance, risk profile, status of past inspections, etc., of banking and insurance institutions and based on the directory database of random inspection targets and the inventory of items subject to random spot checks, determine the frequency and scope of on-site inspections and ensure the scientificity, rationality and feasibility of inspection items.
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Order of the China Banking and Insurance Regulatory Commission [2019] No.7
December 24, 2019
The Measures of the China Banking and Insurance Regulatory Commission for On-site Inspections (for Trial Implementation), which were adopted at the Sixth Commission Affairs Meeting of the China Banking and Insurance Regulatory Commission in 2019, are hereby issued and shall come into effect as of January 28, 2020.
Guo Shuqing, Chairman
Measures of the China Banking and Insurance Regulatory Commission for On-site Inspections (for Trial Implementation)
Chapter I General Provisions
Article 1 These Measures are formulated in accordance with relevant laws and regulations including the Law of the People's Republic of China on Banking Supervision and Administration, the Insurance Law of the People's Republic of China, the Commercial Bank Law of the People's Republic of China with a view to fully implementing the policies and plans of the Central Committee of the Communist Party of China ("CPC") and the State Council on financial work, strengthening the supervision over and administration of the banking and insurance industries, regulating on-site inspection activities, enhancing on-site inspection quality and effect and promoting the sound development of the industries.
Article 2 For the purpose of these Measures, "on-site inspections" refer to the administrative law enforcement activities legally carried out by the China Banking and Insurance Regulatory Commission (hereinafter referred to as the "CBIRC") and its local offices to supervise and inspect the operation and management of banking and insurance institutions.
Article 3 On-site inspection is an important and integral part of the supervision and administration by the CBIRC and its local offices, through giving full play to the role in error detection and irregularity correction, validation and verification, evaluation and guidance, warning and deterrence, etc., with the aim to supervise and urge banking and insurance institutions to implement macro and regulatory policies of the State, raise their operation management level, conduct legitimate and prudent operation, implement their entity responsibilities for risk prevention and control, thus safeguarding the security of the banking and insurance industries, and better serving the development of the real economy.
Article 4 The CBIRC and its local offices shall carry out on-site inspections according to their duties, authority and procedures determined by laws, administrative regulations, rules and normative documents.
Article 5 The CBIRC and its local offices as well as personnel carrying out on-site inspections (hereinafter referred to as "inspectors") shall carry out inspections in accordance with the law, conduct civilized law enforcement, strictly implement the spirit of the eight-point frugality code of the CPC Central Committee, and observe the discipline for confidentiality and clean administration. The CBIRC and its local offices shall strengthen the on-site inspection discipline and the institutional construction for clean administration and enhance the supervision over inspectors' clean administration and duty performance.
Article 6 Where the CBIRC and its local offices carry out on-site inspections in accordance with the law, institutions under inspection and their staff members shall cooperate therewith and ensure the authenticity, accuracy, completeness and timeliness of pertinent documents and materials provided as well as relevant situation reported by them. If an institution under inspection or any of its staff members fails to cooperate in the inspection or authentically report the situation, or refuses or obstructs the inspection, etc., the CBIRC or its local office concerned may, in light of the seriousness of the circumstances, take regulatory measures against and impose administrative punishments on the institution and individual concerned in accordance with the law.
During the inspection, institutions under inspection shall provide necessary office facilities and work support for on-site inspections.
None of institutions under inspection and their staff members may disclose the inspection situation or relevant information to the public without the consent of the CBIRC or its local offices.
Article 7 For the purpose of these Measures, on-site inspections shall include, among others, routine inspections, temporary inspections and audit investigations.
Routine inspections are those included in annual on-site inspection plans, which shall, in light of the inspection scope, be divided into comprehensive inspections over risk management and internal control effectiveness, etc., special inspections over certain business sectors or regions, and follow-up inspections of the implementation of rectification of major problems identified in previous on-site inspections of institutions under inspection.
Temporary inspections are those outside the scope of annual on-site inspection plans that are carried out in line with major work deployments or temporary work tasks.
Audit investigations are the activities in which special investigation of specific matters is carried out according to simplified on-site inspection processes.
Article 8 The CBIRC and its local offices shall establish and improve the on-site inspection management information system to realize the sharing of inspection resources and improve the efficiency of on-site inspections.
Article 9 The CBIRC and its local offices shall prepare budget for the funds for on-site inspection projects in strict accordance with the procedures prescribed by laws and regulations, strengthen budget management and use inspection funds in a compliant manner.
Article 10 The CBIRC and its local offices shall arrange inspection forces commensurate with inspection tasks, strengthen the training of on-site inspection professionals, establish and improve the directory database of random inspectors, refine the expertise fields of talents, raise the on-site inspection level, and take on-site inspections as an important way to foster a team for regulating the banking and insurance industries and to improve the regulatory capacity.
Article 11 All departments and local offices of the CBIRC shall strengthen communication and coordination during on-site inspections and establish effective linkage mechanisms for on-site inspections.
Chapter II Division of Duties
Article 12 In light of the division of regulatory duties, the on-site inspection work of the CBIRC and its local offices shall be subject to hierarchical project establishment and implementation, and on-site inspections shall be carried out as per the working mechanism of "whoever establishes the project and organizes the implementation shall assume the responsibility".
Article 13 The CBIRC shall be responsible for the overall planning for on-site inspection work throughout the system, and in light of the division of regulatory duties, organize on-site inspections of relevant banking and insurance institutions, as well as major special inspections, temporary inspections and audit investigations throughout the system, and conduct overall planning, guidance, assessment and evaluation of on-site inspections carried out by its local offices.
Article 14 All local offices of the CBIRC shall, be responsible for the overall planning for on-site inspection work within their respective jurisdictions and in light of the division of regulatory duties, organize on-site inspections of banking and insurance institutions within their respective jurisdictions, complete the on-site inspection tasks assigned by higher-level departments, and guide, assess and evaluate the on-site inspection work of lower-level departments.
Article 15 The CBIRC may, when needed, directly carry out on-site inspections of institutions under the regulation of banking and insurance regulatory bureaus, and banking and insurance regulatory bureaus may directly carry out on-site inspections of institutions under the regulation of banking and insurance regulatory sub-bureaus within their respective jurisdictions.
Article 16 The on-site inspection departments of the CBIRC and its local offices shall be responsible for the centralized management of on-site inspections.
The departments of the CBIRC and its local offices that undertake on-site inspection tasks shall be responsible for the project establishment, organization and implementation of on-site inspections, put forward suggestions on rectification, adoption of regulatory measures and administrative punishments, evaluate the rectification of institutions under inspection through regulatory talk, follow-up inspection and audit investigation, etc., and promptly communicate with relevant departments on on-site inspections.
Other departments of the CBIRC and its local offices for institutional and functional regulation shall, actively cooperate in carrying out on-site inspections, be responsible for putting forward suggestions on on-site inspection project establishment, strengthen information sharing, and provide data, materials and relevant information required for on-site inspections.
Article 17 The CBIRC and its local offices shall, strengthen the work linkage with relevant government departments to communicate on inspection situations, share inspection information in accordance with the law, and actively explore the use of credit reporting information, industrial and commercial registration information, tax payment information and other external data to assist on-site inspection work; cooperate in the building of a cross-departmental joint spot check mechanism for random selection of both inspectors and inspection targets, and where necessary, work with other departments to carry out on-site inspections of relevant business sectors of banking and insurance institutions.
Article 18 The CBIRC and its local offices shall, in accordance with the provisions of regulatory memorandums and other cooperation agreements and as per the principle of reciprocity, carry out inspections of overseas institutions and businesses of Sino-funded banking and insurance institutions, strengthen the communication and collaboration with overseas regulators, and cooperate with overseas regulators in effectively carrying out inspections of domestic institutions and businesses of foreign-funded banking and insurance institutions.
Chapter III Project Establishment Management
Article 19 The CBIRC and its local offices shall, implement hierarchical project establishment in light of the division of regulatory duties; strengthen the management of on-site inspection project establishment, and in light of the status of legality and compliance, status of rating, degree of system importance, risk profile, status of past inspections, etc., of banking and insurance institutions and based on the directory database of random inspection targets and the inventory of items subject to random spot checks, determine the frequency and scope of on-site inspections and ensure the scientificity, rationality and feasibility of inspection items.
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