China Banking Regulatory Commission No. 4 Order
Administrative Rules Governing the Auto Financing Company
The Rules is stipulated in accordance with relevant laws and regulations to serve the need of developing auto financing business and regulating the business activities of the non-bank financial institutions engaging in auto financing business.
are defined as non-bank financial legal entities charted by the China Banking Regulatory Commission in compliance with relevant laws, regulations and the Rules to provide loans for auto buyers and dealers in the mainland of China.
Auto financing companies are supervised and regulated by the China Banking Regulatory Commission.
Incorporation, Change and Termination
The establishment of an auto financing company shall be subject to the approval of the China Banking Regulatory Commission.
Without the approval of the China Banking Regulatory Commission, no individual or entity shall be allowed to establish an auto financing company, or engage in auto financing business,
or include in the name of a company such names as “auto financing” or “auto loan” that indicate the company’s engagement in auto financing business
An investor of an auto financing company shall satisfy following requirements:
It shall be a corporate legal entity incorporated in and outside China.
If the investor is a non-financial entity, its total assets of the previous year shall be no less than RMB4 billion yuan or an equivalent amount in convertible currencies;
its annual business revenue of the previous year shall be no less than RMB2 billion yuan or an equivalent amount in convertible currencies.
If the investor is a non-bank financial institution, its registered capital shall be no less than RMB300 million yuan or an equivalent amount in convertible currencies;
It shall have sound business performance and remain profitable for the last three consecutive years;
It shall comply with the laws of the countries where it is incorporated and shall have a clean record;
In case of the largest investor, it shall be an auto enterprise or a non-bank financial institution.
The auto enterprise refers to an enterprise that manufactures and sells the whole unit of an automobile.
The largest investor refers to the investor with the largest share of capital and its capital contribution accounting for no less than 30 percent of the total equity of the auto financing company.