China alert - Issue 21, June 2011
With the increasing internationalisation of RMB, there will be more opportunities for foreign investors to invest or reinvest in China using RMB rather than foreign currency. However, the approval procedure can be complicated, and there can be tax costs that are not obvious at first glance. Recently, the relevant authorities have issued circulars in relation to RMB investment and reinvestment including Yin Fa  No. 145 (Circular 145), Peoples' Bank of China (PBOC) Announcement  No. 1 (Circular 1) and Hui Zi Han  No. 7 (Circular 7).