Circular of the General Office of China Banking and Insurance Regulatory Commission on Releasing the Provisions of the China Banking and Insurance Regulatory Commission on the Procedures of Establishment and Implementation of On-site Inspection Projects (for Trial Implementation)
Circular of the General Office of China Banking and Insurance Regulatory Commission on Releasing the Provisions of the China Banking and Insurance Regulatory Commission on the Procedures of Establishment and Implementation of On-site Inspection Projects (for Trial Implementation)
Circular of the General Office of China Banking and Insurance Regulatory Commission on Releasing the Provisions of the China Banking and Insurance Regulatory Commission on the Procedures of Establishment and Implementation of On-site Inspection Projects (for Trial Implementation)
Yin Bao Jian Ban Fa [2020] No.84
September 6, 2020
All banking and insurance regulatory bureaus:
The CBIRC has drafted the Provisions of the China Banking and Insurance Regulatory Commission on the Procedures of Establishment and Implementation of On-site Inspection Projects (for Trial Implementation) under the 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) to standardize the procedures of establishment and implementation of on-site inspection projects, which are hereby issued for your implementation in accordance therewith. Sample forms of the relevant on-site inspection documents are also issued together with the Provisions for your reference.
Provisions of the China Banking and Insurance Regulatory Commission on the Procedures of Establishment and Implementation of On-site Inspection Projects (for Trial Implementation)
Chapter I General Provisions
Article 1 The Provisions are enacted in accordance with the Measures of the China Banking and Insurance Regulatory Commission for On-site Inspections (for Trial Implementation) to standardize the procedures of establishment and implementation of on-site inspection projects.
Article 2 The China Banking and Insurance Regulatory Commission ("CBIRC") or a local office of the CBIRC (“local CBIRC office”) to conduct an on-site inspection of a subject of regulation shall establish an on-site inspection project and organize the implementation of the project in accordance with the Provisions.
According to the memorandums of understanding on regulatory cooperation and other cooperation agreements as well as the principle of reciprocity, when the CBIRC or a local CBIRC office is to conduct an on-site inspection of an overseas institution of a subject of regulation, or an overseas regulator is to conduct an on-site inspection of a Chinese domestic institution of a subject of regulation under the jurisdication of that overseas regulator in collaboration with a Chinese regulator and in the name of the Chinese regulator, it shall establish an on-site inspection project and organize the implementation of the project in accordance with the Provisions.
Article 3 Projects of on-site inspection shall be established on a hierarchical basis. The CBIRC and its local offices are responsible for establishing projects of on-site inspection of their respective direct subjects of regulation based on their respective regulatory jurisdictions.
Depending on regulatory needs, a higher-level agency may establish a project of on-site inspection of a direct subject of regulation under the jurisdiction of a lower-level agency, or may designate or advise a lower-level agency to establish a project of on-site inspection of a subject of regulation under the jurisdiction of that lower-level agency.
If the local CBIRC office of a place where a subject of regulation resides (hereinafter referred to as the "local regulator") deems that a major risk may exist with a non-local branch of that local corporate body, it may advise the local regulator of that branch to establish a project of on-site inspection of the branch.
Article 4 The dedicated on-site inspection department of the CBIRC or of a local CBIRC office shall manage the on-site inspections at the corresponding administrative level, prepare an annual on-site inspection project plan for the corresponding level, countersign off on the establishment of ad hoc projects at the corresponding level, apply unified codes to on-site inspection notices, standardize the format of on-site inspection documents, and prepare summaries of on-site inspection information.
A local CBIRC office without a dedicated on-site inspection department set up under it shall designate one or two of its departments to manage the on-site inspections of the corresponding administrative level.
Chapter II Establishment of Projects
Article 5 On-site inspection projects are established as annual projects or ad hoc projects.
Routine inspections are subject to the annual project establishment procedure; ad hoc inspections are subject to the ad hoc project establishment procedure; and either the annual project establishment procedure or the ad hoc project establishment procedure may apply to audit investigations.
Article 6 The CBIRC shall prepare an annual on-site inspection project plan following the procedure below:
1. Collecting project proposals. The department managing on-site inspections shall collect project proposals from the respective departments for institutional, functional and conduct regulation and various banking and insurance regulatory bureaus at the corresponding level. These departments and agencies shall make project proposals based on annual regulatory priorities, the compliance, regulatory rating, systemic importance and frequency of being inspected of the subjects of regulation, etc., and in a problem- and risk-oriented manner, which shall cover the targets of inspection, the content of inspection, the departments to undertake on-site inspection tasks, etc.
2. Soliciting opinions. After summarizing the proposed projects based on certain criteria, the department managing on-site inspections shall solicit opinions from the proposed departments to undertake an on-site inspection task, as well as the opinions of the relevant CBIRC offices depending on the situation.
3. Giving feedbacks. The proposed departments to undertake an on-site inspection task shall decide whether to adopt the proposed project, by taking into overall consideration factors including their annual work arrangements and inspection resources, as well as the "double random inspection" requirement. If a proposed project is adopted, the target of inspection, content of inspection, manner of implementation, estimated time of inspection, number of inspectors, and cost budget, among other information, shall be made clear; or if a proposed project is rejected, reasons for the rejection shall be clearly stated.
4. Issuing a project establishment plan. Based on the feedback, the department managing on-site inspections shall coordinate or integrate inspection projects or inspection resources and prepare an annual on-site inspection project plan, which shall be reported to the Commission Affairs Meeting or Special Chairman Meeting of the CBIRC for deliberation, and shall be released and implemented after it has been signed off on by the main head of the CBIRC.
The CBIRC’s annual on-site inspection project establishment plan shall generally be released no later than the end of March each year.
Article 7 A banking and insurance regulatory bureau or sub-bureau shall prepare an annual on-site inspection project plan by referring to the CBIRC’s project establishment procedure and based on the regulatory realties and inspection resources in its jurisdiction, which shall be released and implemented after it has been signed off on by the main head of the corresponding administrative level.
The annual on-site inspection project plan of a banking and insurance regulatory bureau or sub-bureau shall generally be released no later than the end of April each year.
Article 8 If it is necessary to cancel an inspection project or make an adjustment to the content of inspection, manner of implementation or time of inspection or make any other adjustment to an inspection project due to reasons such as a change of regulatory priorities, inspection resources, or the matters to be inspected, the department managing on-site inspections shall organize the departments undertaking the on-site inspection task at the corresponding level in the middle of each year to submit the adjustments and reasons, prepare a plan of mid-term adjustments to annual on-site inspection projects, which shall be implemented after it has been signed off on by the main head of the corresponding administrative level.
Article 9 The CBIRC or a local CBIRC office may establish ad hoc projects outside its annual on-site inspection project plan to conduct on-site inspections based on regulatory needs, subject to the approval of the main head of the corresponding administrative level.
If the department for institutional, functional or conduct regulation under the CBIRC or under a local CBIRC office needs to establish an ad hoc project, it should have the application countersigned off on by the department managing on-site inspections at the corresponding level before submitting it, and after it receives the approval for the establishment of the ad hoc project, forward the approval in a timely manner to the department managing on-site inspections at the corresponding level .
Article 10 A banking and insurance regulatory bureau shall prepare a summary of its annual on-site inspection project plan and mid-term adjustment plan, and submit it to the CBIRC.
A banking and insurance regulatory bureau or sub-bureau shall, within ten working days of the approval for establishment of an ad hoc project given by the main head of the corresponding administrative level, report the establishment of the ad hoc project to the CBIRC or the competent banking and insurance regulatory bureau.
......
Yin Bao Jian Ban Fa [2020] No.84
September 6, 2020
All banking and insurance regulatory bureaus:
The CBIRC has drafted the Provisions of the China Banking and Insurance Regulatory Commission on the Procedures of Establishment and Implementation of On-site Inspection Projects (for Trial Implementation) under the 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) to standardize the procedures of establishment and implementation of on-site inspection projects, which are hereby issued for your implementation in accordance therewith. Sample forms of the relevant on-site inspection documents are also issued together with the Provisions for your reference.
Provisions of the China Banking and Insurance Regulatory Commission on the Procedures of Establishment and Implementation of On-site Inspection Projects (for Trial Implementation)
Chapter I General Provisions
Article 1 The Provisions are enacted in accordance with the Measures of the China Banking and Insurance Regulatory Commission for On-site Inspections (for Trial Implementation) to standardize the procedures of establishment and implementation of on-site inspection projects.
Article 2 The China Banking and Insurance Regulatory Commission ("CBIRC") or a local office of the CBIRC (“local CBIRC office”) to conduct an on-site inspection of a subject of regulation shall establish an on-site inspection project and organize the implementation of the project in accordance with the Provisions.
According to the memorandums of understanding on regulatory cooperation and other cooperation agreements as well as the principle of reciprocity, when the CBIRC or a local CBIRC office is to conduct an on-site inspection of an overseas institution of a subject of regulation, or an overseas regulator is to conduct an on-site inspection of a Chinese domestic institution of a subject of regulation under the jurisdication of that overseas regulator in collaboration with a Chinese regulator and in the name of the Chinese regulator, it shall establish an on-site inspection project and organize the implementation of the project in accordance with the Provisions.
Article 3 Projects of on-site inspection shall be established on a hierarchical basis. The CBIRC and its local offices are responsible for establishing projects of on-site inspection of their respective direct subjects of regulation based on their respective regulatory jurisdictions.
Depending on regulatory needs, a higher-level agency may establish a project of on-site inspection of a direct subject of regulation under the jurisdiction of a lower-level agency, or may designate or advise a lower-level agency to establish a project of on-site inspection of a subject of regulation under the jurisdiction of that lower-level agency.
If the local CBIRC office of a place where a subject of regulation resides (hereinafter referred to as the "local regulator") deems that a major risk may exist with a non-local branch of that local corporate body, it may advise the local regulator of that branch to establish a project of on-site inspection of the branch.
Article 4 The dedicated on-site inspection department of the CBIRC or of a local CBIRC office shall manage the on-site inspections at the corresponding administrative level, prepare an annual on-site inspection project plan for the corresponding level, countersign off on the establishment of ad hoc projects at the corresponding level, apply unified codes to on-site inspection notices, standardize the format of on-site inspection documents, and prepare summaries of on-site inspection information.
A local CBIRC office without a dedicated on-site inspection department set up under it shall designate one or two of its departments to manage the on-site inspections of the corresponding administrative level.
Chapter II Establishment of Projects
Article 5 On-site inspection projects are established as annual projects or ad hoc projects.
Routine inspections are subject to the annual project establishment procedure; ad hoc inspections are subject to the ad hoc project establishment procedure; and either the annual project establishment procedure or the ad hoc project establishment procedure may apply to audit investigations.
Article 6 The CBIRC shall prepare an annual on-site inspection project plan following the procedure below:
1. Collecting project proposals. The department managing on-site inspections shall collect project proposals from the respective departments for institutional, functional and conduct regulation and various banking and insurance regulatory bureaus at the corresponding level. These departments and agencies shall make project proposals based on annual regulatory priorities, the compliance, regulatory rating, systemic importance and frequency of being inspected of the subjects of regulation, etc., and in a problem- and risk-oriented manner, which shall cover the targets of inspection, the content of inspection, the departments to undertake on-site inspection tasks, etc.
2. Soliciting opinions. After summarizing the proposed projects based on certain criteria, the department managing on-site inspections shall solicit opinions from the proposed departments to undertake an on-site inspection task, as well as the opinions of the relevant CBIRC offices depending on the situation.
3. Giving feedbacks. The proposed departments to undertake an on-site inspection task shall decide whether to adopt the proposed project, by taking into overall consideration factors including their annual work arrangements and inspection resources, as well as the "double random inspection" requirement. If a proposed project is adopted, the target of inspection, content of inspection, manner of implementation, estimated time of inspection, number of inspectors, and cost budget, among other information, shall be made clear; or if a proposed project is rejected, reasons for the rejection shall be clearly stated.
4. Issuing a project establishment plan. Based on the feedback, the department managing on-site inspections shall coordinate or integrate inspection projects or inspection resources and prepare an annual on-site inspection project plan, which shall be reported to the Commission Affairs Meeting or Special Chairman Meeting of the CBIRC for deliberation, and shall be released and implemented after it has been signed off on by the main head of the CBIRC.
The CBIRC’s annual on-site inspection project establishment plan shall generally be released no later than the end of March each year.
Article 7 A banking and insurance regulatory bureau or sub-bureau shall prepare an annual on-site inspection project plan by referring to the CBIRC’s project establishment procedure and based on the regulatory realties and inspection resources in its jurisdiction, which shall be released and implemented after it has been signed off on by the main head of the corresponding administrative level.
The annual on-site inspection project plan of a banking and insurance regulatory bureau or sub-bureau shall generally be released no later than the end of April each year.
Article 8 If it is necessary to cancel an inspection project or make an adjustment to the content of inspection, manner of implementation or time of inspection or make any other adjustment to an inspection project due to reasons such as a change of regulatory priorities, inspection resources, or the matters to be inspected, the department managing on-site inspections shall organize the departments undertaking the on-site inspection task at the corresponding level in the middle of each year to submit the adjustments and reasons, prepare a plan of mid-term adjustments to annual on-site inspection projects, which shall be implemented after it has been signed off on by the main head of the corresponding administrative level.
Article 9 The CBIRC or a local CBIRC office may establish ad hoc projects outside its annual on-site inspection project plan to conduct on-site inspections based on regulatory needs, subject to the approval of the main head of the corresponding administrative level.
If the department for institutional, functional or conduct regulation under the CBIRC or under a local CBIRC office needs to establish an ad hoc project, it should have the application countersigned off on by the department managing on-site inspections at the corresponding level before submitting it, and after it receives the approval for the establishment of the ad hoc project, forward the approval in a timely manner to the department managing on-site inspections at the corresponding level .
Article 10 A banking and insurance regulatory bureau shall prepare a summary of its annual on-site inspection project plan and mid-term adjustment plan, and submit it to the CBIRC.
A banking and insurance regulatory bureau or sub-bureau shall, within ten working days of the approval for establishment of an ad hoc project given by the main head of the corresponding administrative level, report the establishment of the ad hoc project to the CBIRC or the competent banking and insurance regulatory bureau.
......