The China Banking and Insurance Regulatory Commission issued revised administrative rules for trust companies, overhauling the 2007 framework to reinforce the “trustee” positioning, deepen sector restructuring and strengthen risk prevention, supervision and resolution arrangements. The measures narrow and clarify the scope of trust activities, raise the minimum registered capital requirement, and set more detailed expectations for governance, internal controls, disclosure, audit and market exit. The revised measures comprise eight chapters and 75 articles and recast trust business into three categories: asset service trusts, asset management trusts and public welfare and charitable trusts, while emphasising “seller fulfils duties, buyer bears risks” and rejecting rigid payment expectations. Permitted activities are adjusted across proprietary asset and liability business and “other business”, including removing external guarantees from proprietary business, tightening safety and liquidity requirements for proprietary assets, adding certain liquidity funding options (including shareholder or related-party liquidity loans, targeted bond issuance, and liquidity support loans from the Trust Industry Security Fund Company), and expanding specified advisory, custody and distribution-type services while deleting several non-core intermediary businesses. Governance requirements include a board-level committee for settlor and beneficiary rights protection chaired by an independent director, strengthened shareholder assessment and reporting expectations, tighter related-party transaction controls, and operationalised triggers and parameters for deferred pay and clawback. Operational rules also cover end-to-end trust business management requirements and mandate at least annual external audits covering trust business, proprietary business and other activities, with item-by-item audits for qualifying trust business to be specified in separate asset management trust rules. A public consultation ran from 11 April to 11 May 2025, with most feedback adopted or earmarked for supporting supervisory rules. Trust companies are required to identify and lock in the scale of legacy business requiring rectification, set remediation plans and timetables, and reduce exposures in an orderly manner, with progress used as an input to classification-based supervision; business already subject to post-transition case-by-case handling under the asset management rules is to continue rectification in line with those requirements and previously submitted plans.
China Banking and Insurance Regulatory Commission 2025-09-12
China Banking and Insurance Regulatory Commission revises Trust Company Administrative Measures raising minimum registered capital and restructuring permitted business lines
The China Banking and Insurance Regulatory Commission revised rules for trust companies, updating the 2007 framework to enhance trustee roles, sector restructuring, and risk management. Key changes include narrowing trust activities, raising capital requirements, and detailing governance, internal controls, and market exit expectations. The rules categorize trust business into asset service, asset management, and public welfare trusts, and adjust permitted activities, governance, and operational requirements.