Sec. 131. Findings on Chinese financial industrial policy
309 words·~1 min read·
/bill/117/hr/3524/rh/section-131·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Congress makes the following findings: The People’s Republic of China operates a system of state-owned financial institutions including retail banks, investment banks, asset managers, and insurers which are given favorable treatment under Chinese law while foreign financial institutions have strict restrictions on their ability to operate in the PRC. In order to join the World Trade Organization
(WTO)in 2001, the PRC Government committed to opening the credit card payment business to foreign firms by 2006. After years of the PRC refusing to open its payment market, the United States brought a case against the PRC before the WTO. In 2012, the WTO mandated that the PRC open its card payment market to global competitors. Even after the WTO’s ruling, the PRC Government refused to comply with the ruling and maintained a rule that required all yuan-denominated payment cards to use the PRC’s Union Pay network. Only in 2020, after the Chinese payment market had grown to $27 trillion, did the PRC Government approve the application of foreign firms to enter the market. The PRC continues to maintain aggressive capital controls, limiting access to the Chinese market to foreign investors while hamstringing its own citizens ability to control their money. On November 5, 2018, Chinese President Xi Jinping announced that the PRC would launch a technology innovation stock exchange. The Shanghai Stock Exchange STAR Market launched on July 22, 2019. On October 24, 2020, Chinese billionaire Jack Ma referred to pawnshop mentality of state-owned banks. Shortly thereafter, the initial public offering of his firm Ant Financial was canceled by Chinese regulators. The PRC Government is pioneering the use of a fully digitized yuan, which is set to be the world’s first central bank backed digital currency, and the People’s Bank of China and the Hong Kong Monetary Authority have already begun testing the cross-border functionality of the digital currency.