China Proposes Comprehensive Financial Law, Opens Draft for Public Consultation
On March 20, 2026, China's key financial regulators—including the Ministry of Justice, the People’s Bank of China, the China Securities Regulatory Commission, the State Administration of Foreign Exchange, and the Financial Supervision Bureau—jointly released the draft of the Financial Law of the People's Republic of China for public consultation, inviting feedback until April 19.
The proposed legislation, the country's first comprehensive framework for financial governance, spans 11 chapters and 95 articles, aiming to consolidate existing regulatory experience and modernize oversight across the sector. It outlines principles and mechanisms for financial institutions, markets, products, services, and risk management, while emphasizing legal accountability and operational transparency.
Key provisions include:
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Central Bank and Monetary Policy: Clarifies the role of the central bank and supports a robust framework for macroprudential management and currency stability.
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Financial Institutions Oversight: Introduces full-cycle regulation covering licensing, operations, and exit procedures; significant organizational changes require regulatory approval.
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Market Function and Infrastructure: Establishes standards for market operations, transaction principles, and risk management of financial infrastructure.
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Products, Services, and Compliance: Promotes diversified, professional financial products and services, strengthens compliance management, and combats fraudulent practices.
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Risk Management and Crisis Preparedness: Builds mechanisms for early detection, resolution, and mitigation of financial risks, including market-wide threats.
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Cross-Border and Investor Considerations: Enhances transparency and oversight to facilitate participation by both domestic and foreign investors, including stronger protections for financial consumers.
The consultation process has involved extensive research, industry and expert input, and iterative drafting to ensure the law reflects current practice and evolving market needs. Public feedback can be submitted online, via email, or by post.
For international financial institutions and investors, the draft offers a window into China's evolving regulatory landscape, highlighting increased clarity, structured oversight, and strengthened risk governance across the financial sector.
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