Table of Contents
Chapter I: General Provisions
Article 1 This Law is enacted for the purposes of establishing the status and functions of the People’s Bank of China, clarifying its organizational structure, ensuring the correct formulation and implementation of the state’s monetary policies, establishing and improving the macro-control system of the central bank, and maintaining financial stability.
Article 2 The People’s Bank of China is the central bank of the People’s Republic of China. The People’s Bank of China shall, under the leadership of the State Council, formulate and implement monetary policies, prevent and mitigate financial risks, and maintain financial stability.
Article 3 The objective of monetary policy shall be to maintain the stability of the currency’s value and thereby promote economic growth.
Article 4 The People’s Bank of China shall perform the following functions: (1) issuing and implementing orders and rules related to its functions; (2) formulating and implementing monetary policies in accordance with law; (3) issuing Renminbi and administering the circulation of Renminbi; (4) supervising and administering the interbank lending market and the interbank bond market; (5) implementing foreign exchange administration and supervising and administering the interbank foreign exchange market; (6) supervising and administering the gold market; (7) holding, administering, and operating the state’s foreign exchange reserves and gold reserves; (8) administering the state treasury; (9) maintaining the normal operation of the payment and settlement system; (10) guiding and deploying the anti-money laundering work of the financial industry and monitoring funds flows related to anti-money laundering; (11) being responsible for statistics, investigation, analysis, and forecasting of the financial industry; (12) participating in international financial activities as the central bank of the state; and (13) other functions prescribed by the State Council.
Article 5 The People’s Bank of China shall submit to the State Council for decision and then implement monetary policies and decisions on matters such as the annual money supply, interest rates, and exchange rates, and then implement them. The People’s Bank of China shall, after obtaining the approval of the State Council, implement other monetary policy matters decided by it, and submit them to the Standing Committee of the National People’s Congress for filing.
Chapter II: Organizational Structure
Article 6 The People’s Bank of China shall have a Governor and several Deputy Governors. The Governor of the People’s Bank of China shall be nominated by the Premier of the State Council and decided by the National People’s Congress; when the National People’s Congress is not in session, the decision shall be made by its Standing Committee. The Deputy Governors of the People’s Bank of China shall be appointed and removed by the Premier of the State Council.
Article 7 The People’s Bank of China shall implement a system under which the Governor assumes overall responsibility. The Governor shall direct the work of the People’s Bank of China, and the Deputy Governors shall assist the Governor in his work.
Article 8 The People’s Bank of China shall establish a monetary policy committee. The functions, composition, and working procedures of the monetary policy committee shall be prescribed by the State Council and submitted to the Standing Committee of the National People’s Congress for filing.
Article 9 The People’s Bank of China shall, in accordance with the needs of performing its functions, establish branch offices as its dispatched agencies. The People’s Bank of China shall exercise unified leadership and administration over its branch offices. The branch offices of the People’s Bank of China shall perform their functions in accordance with the authorization of the People’s Bank of China.
Chapter III: Renminbi
Article 10 The legal currency of the People’s Republic of China is the Renminbi. No entity or individual shall refuse to accept payment made in Renminbi for all public and private debts within the territory of the People’s Republic of China.
Article 11 The unit of the Renminbi is the yuan, and the units of the fractional Renminbi are the jiao and the fen. The Renminbi shall be uniformly printed and issued by the People’s Bank of China. The People’s Bank of China shall, when issuing a new version of Renminbi, announce the issuance date, face value, design, pattern, and specifications.
Article 12 Any entity or individual shall be prohibited from printing or selling tokens to circulate in the market in lieu of Renminbi. The forging or altering of Renminbi is prohibited. The sale or purchase of forged or altered Renminbi is prohibited. The transportation, holding, or use of forged or altered Renminbi is prohibited.
Chapter IV: Business Operations
Article 13 The People’s Bank of China may, for the purpose of implementing monetary policy, engage in the following business operations using the monetary policy instruments prescribed in the preceding article: (1) requiring banking financial institutions to deposit reserve funds at the required reserve ratio; (2) determining the central bank base interest rate; (3) conducting rediscount operations for banking financial institutions that have opened accounts with the People’s Bank of China; (4) providing loans to commercial banks; (5) buying and selling government bonds, other government securities, and financial bonds in the open market; and (6) other monetary policy instruments determined by the State Council.
Article 14 The People’s Bank of China shall not provide overdrafts to the government, and shall not directly subscribe for or underwrite government bonds or other government securities.
Article 15 The People’s Bank of China shall organize or assist in organizing banking financial institutions to establish a clearing system, coordinate clearing matters among banking financial institutions, provide clearing services, and formulate specific measures. The People’s Bank of China, together with the banking regulatory authority under the State Council, shall formulate rules on payment and settlement.
Chapter V: Financial Supervision and Administration
Article 16 The People’s Bank of China shall have the right to conduct inspection and supervision of financial institutions and other entities and individuals for the purpose of performing its functions such as implementing monetary policy, maintaining financial stability, and providing financial services.
Article 17 The People’s Bank of China shall, in accordance with law, monitor the financial markets, conduct stress tests on the financial markets, and, in conjunction with the relevant financial regulatory authorities under the State Council, establish a mechanism for coordinating financial supervision and administration.
Article 18 The People’s Bank of China shall have the right to require banking financial institutions to submit balance sheets, income statements, and other financial, accounting, and statistical statements and materials as required. The People’s Bank of China shall, in conjunction with the relevant financial regulatory authorities, establish a unified sharing platform for financial industry statistical data.
Chapter VI: Financial Accounting and Financial Affairs
Article 19 The People’s Bank of China shall implement an independent financial budget management system. The budget of the People’s Bank of China shall be incorporated into the central budget after being examined by the financial department under the State Council, and shall be subject to the budget execution supervision of the financial department under the State Council.
Article 20 The net profit of the People’s Bank of China for each fiscal year, after making full provisions for the general reserve fund and making allocations in accordance with the proportion determined by the financial department under the State Council, shall all be turned over to the central finance. The losses of the People’s Bank of China shall be offset by the central finance.
Chapter VII: Legal Liability
Article 21 Where a person prints or sells tokens to circulate in the market in lieu of Renminbi, the People’s Bank of China shall order him to cease the illegal act and impose a fine of not more than RMB 200,000.
Article 22 Where a person forges or alters Renminbi, or sells or purchases forged Renminbi, or transports, holds, or uses forged or altered Renminbi knowing that it is forged or altered, criminal liability shall be pursued in accordance with law.
Article 23 Where the People’s Bank of China commits any of the following acts, the directly responsible person in charge and other directly liable persons shall be subject to administrative sanctions in accordance with law; where a crime is constituted, criminal liability shall be pursued: (1) providing loans in violation of regulations; (2) providing guarantees for entities or individuals; or (3) using the currency issued without authorization.
Chapter VIII: Supplementary Provisions
Article 24 This Law shall come into force on March 18, 1995. The 2003 Amendment shall come into force on February 1, 2004.
Translation note: This is an unofficial English translation for reference purposes. The original Chinese text shall prevail in all legal matters.
