OREANDA-NEWS. August 31, 2012. ICBC settled the first FX transaction in China under the new FX administration for trade in goods. The transaction involves FX payment (import) and FX collection (export) for Sinochem Plastics Co., Ltd and Sinochem Hebei Fuheng Co., Ltd, two subsidiaries under Sinochem. This is also the first import/export FX settlement since the new FX administration for trade in goods is in force. From now on, companies save considerable time when making FX payment for import or collecting FX for export via ICBC, since it is faster without going through tedious steps, reported the press-centre of ICBC. 

In a bid to facilitate trade and upgrade the service and management on the foreign exchange involved in import and export, State Administration of Foreign Exchange ("SAFE") announced a nationwide reform on FX administration system for trade in goods beginning from August 1, 2012.

The new system brings three benefits: First, companies can effectively use FX working capital since there is no need to go through the procedures of verification and writing-off export proceeds in foreign exchange; Instrument for the collection, verification and writing-off of export proceeds in foreign exchange is cancelled. Second, SAFE dynamically manages and classifies companies into different categories. Fewer documents involved. Third, fewer steps, less cost for banks to process FX payment/collection. SAFE's FX monitoring system for trade in goods replaces former FX payment/collection verification system, online verification system for FX settlement (export) and trade facility registration system.

ICBC upgrades its business workflow and process in accordance with the new FX administration system for trade in goods, said an executive with ICBC. ICBC counter staff now save 73% time in handling one FX receipt on export, 64% time in making one FX payment on import. For import and export companies, this means higher working capital turnover. ICBC gives top priority to implement rules and procedures according to the new FX administration system for trade in goods. Trainings were organized for ICBC corporate clients engaged in import/export to understand the new system and discuss the issues which the companies concern most such as the simpler procedures, company reporting obligation, transition between old and new policies.

Sinochem executives said, the reform brings the companies to the next phase of growth. Sinochem has also much benefited form the reform. Under the new system, companies no longer need to go through the procedures of verification and writing-off export proceeds in foreign exchange and spend considerably less time in bank to collect FX (export) or pay FX (import). Companies have more working capital on hand.