Interim Measures for the Equity Management of Commercial Banks

· Document Number：Order No. 1 [2018] of the China Banking Regulatory Commission

· Area of Law： Banking & Finance

· Level of Authority： Departmental Rules

· Date issued：01-05-2018

· Effective Date：01-05-2018

· Status： Effective

· Issuing Authority： China Banking Regulatory Commission

Order of the China Banking Regulatory Commission
(No. 1 [2018])
The Interim Measures for the Equity Management of Commercial Banks, as adopted at the 1st chairman's meeting of the China Banking Regulatory Commission in 2018, are hereby issued, and shall come into force on the date of issuance.
Chairman: Guo Shuqing
January 5, 2018
Interim Measures for the Equity Management of Commercial Banks
Chapter I General Provisions
Article 1 For the purposes of strengthening the administration of equities of commercial banks, regulating the acts of shareholders of commercial banks, protecting the lawful rights and interests of commercial banks, depositors and other clients, as well as the lawful interests of shareholders, and promoting the sustainable and sound development of commercial banks, these Measures are developed according to the Company Law of the People's Republic of China, the Banking Supervision Law of the People's Republic of China, the Law of the People's Republic of China on Commercial Banks and other laws and regulations.
Article 2 These Measures shall apply to the commercial banks formed within the territory of the People's Republic of China in accordance with the law. If any law or administrative regulation otherwise provides for the change of shareholders or adjustment to shareholders' shareholding ratio by foreign-funded banks, such provisions shall prevail.
Article 3 Commercial banks shall conduct equity management under the principles of categorized management, good qualifications, clear relationships, specific rights and responsibilities, and openness and transparency.
Article 4 An investor and its affiliates and persons acting in concert, either separately or jointly, intending to initially or accumulatively hold more than 5% of total capital or total shares of a commercial bank, shall file an application with the CBRC or its local office for approval in advance. The official reply for the administrative licensing of proposed holding of more than 5% of total shares of a commercial bank through a domestic or overseas stock market shall be valid for six months. The specific requirements and procedures for approval shall be subject to relevant provisions issued by the CBRC.
An investor and its affiliates and persons acting in concert that hold, either separately or jointly, not less than 1% but not more than 5% of a commercial bank's total capital or total shares shall, within ten working days of the date of obtaining corresponding equities, report to the CBRC or its local office. The specific requirements and procedures for reporting shall be otherwise prescribed by the CBRC.
Article 5 Shareholders of a commercial bank shall have good social reputation, good credit records, tax payment records and financial status, comply with the laws and regulations, and satisfy the regulatory requirements.
Article 6 The relationship between a commercial bank's shareholder and its controlling shareholder, actual controller, affiliates, persons acting in concert, ultimate beneficiaries and other parties shall be clear and transparent.
The shareholding ratio of a shareholder and its affiliates and persons acting in concert shall be calculated on a consolidated basis.
Article 7 Shareholders of a commercial bank shall abide by laws, regulations, regulatory provisions and the company's bylaws, exercise their shareholders' rights and perform their statutory obligations in accordance with the law.
A commercial bank shall strengthen the management of equity affairs and improve its corporate governance structure.
The CBRC and its local offices shall conduct equity supervision of commercial banks in accordance with the law, and investigate and punish the violations of laws and regulations of commercial banks and their shareholders and other relevant entities and persons.
Article 8 A commercial bank and its shareholders shall, according to the laws, regulations and regulatory requirements, fully disclose the relevant information and accept social supervision.
Article 9 Commercial banks, the CBRC and its local offices shall strengthen the management of commercial banks' major shareholders.
“Major shareholders of a commercial bank” means shareholders that hold or control not less than 5% of the shares or voting rights of the commercial bank or that hold less than 5% of total capital or total shares of the commercial bank but have significant impact on the business management of the commercial bank.
For the purpose of the preceding paragraph, “significant impact” includes but is not limited to, dispatching directors, supervisors or senior executives to commercial banks, affecting the financial and business management decision-making of commercial banks via agreements or by other means, and other circumstances identified by the CBRC or its local offices.
Chapter II Shareholders' Responsibilities
Article 10 Shareholders of a commercial bank shall fulfill the obligation of capital contribution in strict accordance with the laws and regulations and the provisions issued by the CBRC.
A shareholder of a commercial bank shall purchase shares of the commercial bank with its own funds obtained from legal sources, rather than entrusted funds, debt funds and other funds not owned by itself, unless otherwise prescribed by any law or regulation.
Article 11 When purchasing shares of a commercial bank, a major shareholder shall undertake in writing to comply with laws and regulations, regulatory provisions and the company's bylaws and make a statement on the purpose of purchasing shares of the commercial bank.
Article 12 No shareholder of a commercial bank may authorize any other person to or accept any other person's authorization to hold equity of the commercial bank.
A major shareholder of a commercial bank shall state its equity structure level by level up to its actual controller and ultimate beneficiary, as well as its relationship as an affiliate or a person acting in concert with any other shareholder.
Article 13 A shareholder of a commercial bank that plans to transfer the equity of the commercial bank it holds shall notify the transferee that it should meet the conditions as set forth by laws and regulations and by the CBRC.
Article 14 The same investor and its affiliates and persons acting in concert shall not purchase shares of more than two commercial banks as a major shareholder or control more than one commercial bank.
The purchase of shares of a commercial bank by an investor holding shares of a commercial bank upon authorization by the State Council, a banking financial institution or an entity as otherwise prescribed by laws and regulations, or merger and acquisition or restructuring of a high-risk commercial bank by an investor upon approval of the CBRC shall not be subject to the provisions of the preceding paragraph.
Article 15 The same investor and its affiliates and persons acting in concert purchasing shares of a commercial bank shall follow the requirements for shareholding ratio as prescribed by the CBRC.
Article 16 A commercial bank's major shareholder and its controlling shareholder or actual controller shall not fall under any of the following circumstances:
(1) Being listed as an object subject to joint punishment for dishonesty by relevant departments.
(2) Seriously evading bank debts.
(3) Providing false materials or making false statement.
(4) Assuming significant liability for a commercial bank's business failure or material violation of laws and regulations.
(5) Rejecting or obstructing the lawful implementation of supervision and administration by the CBRC or its local office.
(6) Having been investigated and punished by the financial supervision department or relevant government departments due to violations of laws and regulations, and having caused adverse impact.
(7) Other circumstances that may cause adverse impact on a commercial bank's business management.
Article 17 A major shareholder of a commercial bank shall not transfer any equity it holds within five years from the date of obtaining the equity.
As to equity transfer as a result of risk disposal measures approved by the CBRC or its local office, or ordered by the CBRC or its local office, or involving judicial enforcement, or made between different entities controlled by the same investor, or under any other particular circumstance, the provisions of the preceding paragraph shall not apply.
Article 18 A major shareholder of a commercial bank shall exercise its rights as a capital contributor in strict accordance with laws and regulations, regulatory provisions and the company's bylaws, fulfill the obligations of capital contributor, and shall not abuse shareholders' rights or utilize its influence to intervene in the decision-making power and management power that the board of directors and the senior management are entitled to in accordance with the company's bylaws, or directly intervene in or utilize influence to intervene in the business management of the commercial bank bypassing the board of directors and the senior management, conduct tunneling, or damage the lawful rights and interests of any depositor, the commercial bank or any other shareholder in any other form.
Article 19 A major shareholder of a commercial bank shall, according to the regulatory provisions, make a written commitment to supply additional capital to the commercial bank when necessary, and report its capital replenishment ability to the CBRC or its local office on an annual basis through the commercial bank.
Article 20 A major shareholder of a commercial bank shall establish an effective risk isolation mechanism to prevent risk contagion and transfer among shareholders, the commercial bank and other affiliates.
Article 21 A major shareholder of a commercial bank shall effectively manage the concurrent holding of positions by any of the members of its board of directors, members of its board of supervisors and its senior executives in the commercial bank or in any other affiliate as a member of the board of directors, a member of the board of supervisors or a senior executive to prevent conflicts of interest.
Article 22 A shareholder of a commercial bank shall comply with laws and regulations and the relevant provisions of the CBRC on affiliated transactions, shall not conduct inappropriate affiliated transactions with the commercial bank, or use its influence on the business management of the commercial bank to seek illicit benefits.
Article 23 Where a shareholder of a commercial bank pledges its equity in the commercial bank, it shall comply with laws and regulations and the relevant provisions of the CBRC on the pledge of equity of commercial banks, and shall not damage the interests of any other shareholder or the commercial bank.
Article 24 Where a commercial bank is involved in any major risk incident or serious violation of law or regulation, and risk disposal, takeover or any other measure is taken against it by the CBRC or its local office, shareholders shall actively cooperate with the CBRC and its local office in risk disposal and other work.
Article 25 Financial products may hold shares of a listed commercial bank, but the shares accumulatively held in the same commercial bank by the financial products controlled by a single investor, issuer or manager and its actual controller, affiliates and persons acting in concert shall not exceed 5% of total shares of the commercial bank.
A major shareholder of a commercial bank shall not hold shares of the commercial bank through financial products issued, managed or controlled by it by any other means.
Chapter III Duties of Commercial Banks
Article 26 The board of directors of a commercial bank shall be diligent, and assume ultimate responsibility for the management of equity affairs.
The board chairman of a commercial bank is the first responsible person for handling the equity affairs of the commercial bank. The board secretary shall assist the board chairman with his work, and is the person directly responsible for handling the equity affairs.
The board chairman and board secretary shall faithfully, honestly and diligently perform their duties. Those who fail to fulfill their duties with due diligence shall undertake legal liabilities according to the law.
Article 27 A commercial bank shall establish and improve an equity information management system and equity management rules, and effectively conduct equity information registration, management of affiliated transactions, information disclosure and other work.
A commercial bank shall strengthen communication with its shareholders and investors, and be responsible for such work as applying for administrative licensing relating to equity affairs, reporting of shareholders' information and relevant matters, and submission of materials.
Article 28 A commercial bank shall include the regulatory requirements for the management of shareholders and shareholders' rights and obligations in its bylaws and specify the following content in the company's bylaws:
(1) Shareholders shall comply with laws and regulations and regulatory provisions.
(2) Major shareholders shall supply additional capital to the commercial bank when necessary.
(3) Shareholders who fail to apply to the regulatory departments for approval or fail to report to the regulatory departments, despite being required to do so, shall not exercise the right to request convening of a general meeting of shareholders, the voting right, right of nomination, proposal right, and right of disposition, among others.
(4) For a shareholder that makes any false statement, abuses shareholders' rights or otherwise damages the interests of the commercial bank, the CBRC or its local office may restrict or prohibit affiliated transactions between the commercial bank and the shareholder, restrict the limit of equity held in the commercial bank, and equity pledge ratio, among others, and restrict its right to request convening of a general meeting of shareholders, the voting right, right of nomination, proposal right, and right of disposition, among others.
Article 29 A commercial bank shall strengthen the examination of shareholders' qualifications, verify information on its major shareholders and their controlling shareholders, actual controllers, affiliates, persons acting in concert and ultimate beneficiaries and keep abreast of any changes therein, judge shareholders' influence on the business management of the commercial bank, and in accordance with the law, report or disclose the relevant information in a timely, accurate and complete manner.
Article 30 The board of directors of a commercial bank shall assess, at least on an annual basis, major shareholders' qualifications, performance of commitments, implementation of the company's bylaws or agreements, compliance with laws and regulations and regulatory provisions, and submit the assessment report to the CBRC or its local office in a timely manner.
Article 31 A commercial bank shall establish equity custody rules to put its equity under centralized custody of a custody institution satisfying the requirements. The specific requirements for custody shall be otherwise prescribed by the CBRC.
Article 32 A commercial bank shall reinforce the management of affiliated transactions, accurately identify affiliates, strictly implement the rules for the approval of affiliated transactions and information disclosure rules, and report the information on affiliated transactions to the CBRC or its local office in a timely manner.
A commercial bank shall manage its major shareholders and their controlling shareholders, actual controllers, affiliates, persons acting in concert and ultimate beneficiaries as its own affiliates according to the penetration principle.
Article 33 The balance of credit granted by a commercial bank to a major shareholder or its controlling shareholder, actual controller, affiliate, person acting in concert, or ultimate beneficiary as a single entity shall not exceed 10% of the net capital of the commercial bank. The total balance of credit granted by a commercial bank to a single major shareholder and its controlling shareholder, actual controller, affiliates, persons acting in concert and ultimate beneficiaries shall not exceed 15% of the net capital of the commercial bank.
The credit granted as mentioned in the preceding paragraph includes loans (including trade financing), bill acceptance and discounts, overdrafts, bond investments, investments by specific purpose vehicles, issuance of letters of credit, factoring, guarantees, loan commitments, and other services of which credit risks are substantially borne by a commercial bank or wealth management products issued by a commercial bank. The commercial bank shall confirm the final debtor according to the penetration principle.
Where a commercial bank's major shareholder or its controlling shareholder, actual controller, affiliate, person acting in concert, or ultimate beneficiary, among others, is a financial institution, the commercial bank shall, when conducting interbank business with it, comply with laws and regulations and the relevant provisions of regulatory departments on the interbank business.
Article 34 In the case of the purchase and sale or lease of any self-use movable property or immovable property, purchase and sale of credit assets, receipt and disposition of capital for debt payment, credit enhancement, credit evaluation, asset appraisal, legal, information, technical, infrastructure and other service transactions, sale on commission and other transactions conducted by a commercial bank with any of its major shareholders or its controlling shareholder, actual controller, affiliate, person acting in concert or ultimate beneficiary, the commercial bank shall comply with laws and regulations, and relevant provisions issued by the CBRC and follow the commercial principles, and provide transaction conditions no favorable than those provided for non-affiliates, so as to prevent risk contagion and tunneling.
Article 35 A commercial bank shall strengthen the management of equity pledge and release of pledge, record pledge-related information on the roster of shareholders, and assist shareholders in undergoing pledge registration at relevant institutions in a timely manner.
Chapter IV Information Disclosure
Article 36 A major shareholder of a commercial bank shall report the following information to the commercial bank in a timely, accurate and complete manner.
(1) Its operating status, financial information and equity structure.
(2) Source of funds for purchasing shares of the commercial bank.
(3) Its controlling shareholder, actual controller, affiliates, persons acting in concert, and ultimate beneficiaries and any changes therein.
(4) Any conservatory measure in litigation or enforcement against its equity in the commercial bank.
(5) Pledge or release of pledge of its equity in the commercial bank.
(6) Change in name.
(7) Business combination or division.
(8) It has received any regulatory measure such as suspending business operation for rectification, designated custody, take-over, and revocation, or it enters dissolution, bankruptcy or liquidation procedures.
(9) Any other circumstance that may change its qualifications as a shareholder or its equity in the commercial bank.
Article 37 A commercial bank shall disclose its equity information on its official website or through other channels via semi-annual reports or annual reports in a truthful, accurate and complete manner. The information to be disclosed shall cover:
(1) total number of shares and shareholders at the end of the reporting period and changes in shares during the reporting period;
(2) shareholding ratios of its top ten shareholders at the end of the reporting period;
(3) information on major shareholders and their controlling shareholders, actual controllers, affiliates, persons acting in concert and ultimate beneficiaries at the end of the reporting period;
(4) affiliated transactions with the major shareholders and their controlling shareholders, actual controllers, affiliates, persons acting in concert and ultimate beneficiaries during the reporting period;
(5) information on the pledge of bank's equity by major shareholders;
(6) information on directors and supervisors nominated by shareholders; and
(7) other information as prescribed by the CBRC.
Article 38 Where the relevant information on major shareholders may cause any material change in the qualification conditions of shareholders or any material change in the equity of the commercial bank, the commercial bank shall disclose such information in a timely manner.
Article 39 As to equity affairs which shall be submitted to the CBRC or its local office for approval but have not yet been approved, the commercial bank shall make an explanation at the time of information disclosure.
Chapter V Supervision and Administration
Article 40 The CBRC and its local offices shall strengthen the penetrated supervision of shareholders of commercial banks, and strengthen the examination, recognition and identification of major shareholders and their controlling shareholders, actual controllers, affiliates, persons acting in concert and ultimate beneficiaries, who shall be subject to the identification of the CBRC or its local offices.
The CBRC and its local offices shall have the right to take the following measures to obtain the information on commercial banks' shareholders and their controlling shareholders, actual controllers, affiliates, persons acting in concert and ultimate beneficiaries:
(1) Requiring shareholders to disclose, level by level, their shareholders, actual controllers, affiliates, persons acting in concert and ultimate beneficiaries.
(2) Requiring shareholders to submit balance sheets, income statements and other financial accounting reports and statistical statements, materials on the company's development strategies and business management, and audit reports issued by certified public accountants.
(3) Requiring shareholders and related persons to explain relevant matters.
(4) Questioning shareholders and related persons.
(5) Conducting field visits or investigations on shareholders' operating conditions.
(6) Other regulatory measures that may be taken in the opinion of the CBRC or its local offices.
For a commercial bank's shareholders and their controlling shareholders, actual controllers, affiliates, persons acting in concert and ultimate beneficiaries relevant to the suspected illegal matters, the CBRC and its local offices shall have the right to consult and copy relevant financial accounting, property registration and other documents and materials in accordance with the law, and register and keep in advance the documents and materials that may be transferred, concealed, destroyed or forged.
Article 41 The CBRC and its local offices shall have the right to require a commercial bank to specify in its bylaws shareholders' rights and obligations and the content of regulatory provisions and requirements that shall be observed and implemented by shareholders; and have the right to require a commercial bank or its shareholders to make a statement on the authenticity of information provided by it about the relevant qualifications, affiliation or funds to purchase shares, among others, and undertake to assume the consequences of providing false information or making false statements.
Article 42 The CBRC and its local offices shall have the right to assess the business activities of commercial banks' major shareholders and their controlling shareholders, actual controllers, affiliates, persons acting in concert and ultimate beneficiaries, so as to judge the impact of such business activities on the safe and stable operation of the commercial banks and the bank groups.
Article 43 The CBRC and its local offices shall have the right to require commercial banks to reduce the maximum proportion of balance of credit granted to one or more or even all shareholders and their controlling shareholders, actual controllers, affiliates, persons acting in concert, and ultimate beneficiaries to its net capital, restrict or prohibit transactions between the commercial bank and one or more or even all shareholders and their controlling shareholders, actual controllers, affiliates, persons acting in concert and ultimate beneficiaries, based on the risk conditions of affiliated transactions between the commercial bank and its shareholders.
Article 44 The CBRC and its local offices shall have the right to restrict the number of commercial banks in which the same shareholder and its affiliates and persons acting in concert may invest, the limit of equity of a commercial bank that they may hold, and their equity pledge ratio, among others, based on the requirements for prudential supervision.
Article 45 The CBRC and its local offices shall establish a mechanism for the dynamic monitoring of shareholders to evaluate the qualifications of major shareholders of commercial banks, and their compliance with the company's bylaws and performance of commitments, exercise of shareholders' rights and obligations and compliance with laws and regulations and regulatory provisions, at least on an annual basis.
The CBRC and its local offices shall include the evaluation in the routine supervision and administration, and take such regulatory measures as ordering rectification within the prescribed time limit, as the case may be.
Article 46 Where a major shareholder of a commercial bank is a financial institution, the CBRC or its local office shall establish an effective mechanism for information exchange and sharing with the regulatory authority of such financial institution.
Article 47 Where a commercial bank falls under any of the following circumstances in equity management, the CBRC or its local office shall order it to take corrective action within a prescribed time limit; if it fails to do so within the prescribed time limit, or its conduct seriously endangers the stable operation of the commercial bank or damages the lawful rights and interests of any depositor or any other client, appropriate regulatory measures may be taken against it according to different circumstances under the provision of Article 37 of the Banking Supervision Law of the People's Republic of China, with the approval of the person in charge of the CBRC or its local office at the provincial level.
(1) Failing to apply for approval or report in a timely manner as required.
(2) Providing statements, reports and other documents or materials that are false or conceal important facts.
(3) Failing to develop the company's bylaws according to the relevant provisions to specify shareholders' rights and obligations.
(4) Failing to conduct equity custody as required.
(5) Failing to disclose information according to the relevant provisions.
(6) Failing to conduct affiliated transactions according to the relevant provisions.
(7) Failing to manage equity pledge according to the relevant provisions.
(8) Refusing or impeding the investigation and verification by the regulatory departments.
(9) Otherwise violating the requirements for equity management.
Article 48 Where a commercial bank's shareholder or its controlling shareholder, actual controller, affiliate, person acting in concert or ultimate beneficiary, among others, falls under any of the following circumstances, and causes a commercial bank's violation of the rules for prudential operations, the CBRC or its local office may, in accordance with the provision of Article 37 of the Banking Supervision Law of the People's Republic of China, order the controlling shareholder of the commercial bank to transfer equity, and restrict the relevant rights of the said shareholder of a commercial bank to participate in business management, including the right to request convening of a general meeting of shareholders, voting right, right of nomination, proposal right, and right of disposition, among others:
(1) Making false or insufficient capital contribution, withdrawing paid-in capital or withdrawing paid-in capital in any disguised form.
(2) Illegally using entrusted funds, debt funds or any other funds not owned by it to invest in the commercial bank.
(3) Holding equity on a commission basis in violation of regulations.
(4) Failing to report as required.
(5) Refusing to provide documents and materials to the commercial bank or the CBRC or its local office, providing false document and materials, concealing important information, or delaying the provision of relevant documents and materials.
(6) Violating any commitment or the company's bylaws.
(7) A major shareholder or its controlling shareholder or actual controller fails to meet regulatory requirements prescribed in these Measures.
(8) Conducting affiliated transactions in violation of any regulation.
(9) Conducting equity pledge in violation of any regulation.
(10) Refusing or impeding the investigation and verification of the CBRC or its local office.
(11) Failing to cooperate with the CBRC or its local office in risk disposal.
(12) Otherwise abusing shareholders' rights or failing to fulfill shareholders' obligations and thus damaging the interests of the commercial bank, any depositor or any other shareholder.
Article 49 Where a commercial bank fails to manage equity in accordance with these Measures, the CBRC or its local office may adjust the corporate governance assessment result or regulatory rating of the commercial bank.
Where a member of the board of directors of a commercial bank fails to raise an objection to any violation of law or regulation in equity management during the performance of his or her duties, he or she shall not be evaluated as competent in the latest performance evaluation.
Article 50 The CBRC and its local offices shall establish a database of commercial banks' equity management and shareholders' misconduct records, and share information with relevant departments or government bodies through the national credit information sharing platform.
A shareholder who commits any violation of laws or regulations and refuses to take corrective action may be subject to disciplinary actions given by the CBRC and its local offices, separately or jointly with the relevant departments and entities, and be subject to circulation of a notice of criticism, public reprimand, or prohibition from purchasing shares of the commercial bank for a certain period of time or even all his or her life.
Chapter VI Legal Liability
Article 51 Where a commercial bank fails to examine, verify or disclose information of any shareholder or its controlling shareholder, actual controller, affiliate, person acting in concert or ultimate beneficiary as required, the CBRC or its local office shall, in accordance with the provisions of Articles 46 and 48 of the Banking Supervision Law of the People's Republic of China, order the bank to take corrective action and impose a fine of not less than 200,000 yuan but not more than 500,000 yuan on it; and give a warning to the liable board chairman and board secretary and other relevant liable persons, and impose a fine of not less than 50,000 but not more than 500,000 on them.
Article 52 Where a commercial bank falls under any of the circumstances prescribed in Article 47 of these Measures and the circumstances are relatively serious, the CBRC or its local office shall, in accordance with the provisions of Articles 46, 47 and 48 of the Banking Supervision Law of the People's Republic of China, impose a fine of not less than 200,000 yuan but not more than 500,000 yuan on it. If the circumstances are particularly serious or no corrective action is taken within the prescribed time limit, the CBRC or its local office may order the commercial bank to suspend business operation for rectification or revoke its business permit. It shall give a warning to the liable board chairman and board secretary and other relevant liable persons and impose a fine of not less than 50,000 yuan but not more than 500,000 yuan on them, and if the circumstances are serious, cancel their qualifications for serving as a director or senior executive.
Article 53 Where an investor holds more than 5% of total capital or total shares of a commercial bank without approval, the CBRC or its local office shall, in accordance with the provision of Article 79 of the Law of the People's Republic of China on Commercial Banks, order it to take corrective action, and confiscate its illegal income, if any, and impose a fine of not less than one time but not more than five times the illegal income on it if the illegal income is not less than 50,000 yuan. If there is no illegal income or the illegal income is less than 50,000 yuan, a fine of not less than 50,000 yuan but not more than 500,000 yuan shall be imposed on it.
Article 54 Where a commercial bank's shareholder or its controlling shareholder, actual controller or affiliate, person acting in concert, or ultimate beneficiary obtains the approval, by concealment, fraud or any other improper means, to hold more than 5% of total capital or total shares of the commercial bank, the CBRC or its local office shall revoke the relevant administrative licensing in accordance with the provisions of the Administrative Licensing Law of the People's Republic of China.
Chapter VII Supplementary Provisions
Article 55 For the purposes of these Measures, “not less than” and “more than” shall include the figure itself, and “not more than” and “less than” shall exclude the figure itself.
Article 56 The following terms in these Measures shall have the following meanings:
(1) The term “controlling shareholder” means a shareholder whose capital contribution accounts for more than 50% of the total capital of a limited liability company or whose shareholding accounts for more than 50% of the total stock of a joint stock company limited, or a shareholder whose capital contribution or shareholding is less than 50% of the total capital or stock but whose voting rights as entitled by its capital contribution or shareholding can have a significant impact on the resolutions of the shareholders' meeting or the general meeting of shareholders, as provided for in Article 216 of the Company Law of the People's Republic of China.
(2) The term “actual controller” means a person who is not a shareholder but is able to exercise actual control over the acts of the company by means of investment relationships, agreements or other arrangements, as provided for in Article 216 of the Company Law of the People's Republic of China.
(3) The term “affiliates” means that a party has the power to control, jointly control or exercise a significant impact on another party, or two or more parties are subject to control, joint control or significant influence from the same party, as provided for in the Accounting Standards for Business Enterprises No. 36—Disclosure of Affiliates. But any two enterprises controlled by the state shall not be deemed as having affiliation only by virtue of being under the common control of the state.
(4) The term “acting in concert” means the act or fact of an investor working together with other investors through an agreement or any other arrangement to jointly increase the quantity of voting shares under their control in a company. Relevant investors acting in concert are persons acting in concert.
(5) The term “ultimate beneficiary” means a person that is actually entitled to return on equity of the commercial bank.
Article 57 These Measures shall apply, mutatis mutandis, to rural cooperative banks, rural credit cooperatives, loan companies, rural mutual cooperatives, financial asset management companies, trust companies, enterprise group finance companies, financial leasing companies, auto finance companies, money brokerage companies, and consumer finance companies formed within the territory of the People's Republic of China according to the law, and other financial institutions formed with the approval of the CBRC, unless otherwise prescribed by the CBRC.
Article 58 These Measures shall be subject to interpretation by the CBRC.
Article 59 These Measures shall come into force on the date of issuance. For any discrepancy between the provisions issued by the CBRC on equity management of commercial banks before these Measures come into force and these Measures, these Measures shall prevail.