As of November 1, 2024, the People’s Bank of China (PBOC) and the State Administration for Market Regulation (SAMR) implemented the Administrative Measures for Beneficial Ownership Information (order [2024] No. 3, the Measures). These new requirements aim to enhance market transparency, maintain market and financial order, and prevent and curb money laundering and terrorist financing activities.
What’s changing?
The Measures require entities in China to file detailed beneficial ownership information with relevant registration systems. For existing entities registered before November 1, 2024, compliance must be achieved by November 1, 2025.
After making a commitment, entities exempt from filing include those:
- With registered capital (or capital contribution) not exceeding CNY 10 million (or equivalent foreign currency)
- Whose shareholders or partners are all natural persons, provided no one else exercises control or derives benefits through other means
Who does this affect?
The filing obligation applies to:
- Companies
- Partnership enterprises
- Branches of foreign companies
- Other entities specified by the PBOC and SAMR
Who qualifies as a beneficial owner?
A beneficial owner is defined as a natural person who meets any of the following criteria:
- Ultimately owns 25% or more of equity, shares, or partnership interests, directly or indirectly.
- Ultimately holds 25% or more of profit rights or voting rights, despite not meeting the criterion in item 1.
- Exercises actual control over the entity through agreements or closely related persons or influence, such as appointing senior managing officials, determining financial or managerial decisions, etc., despite not meeting the criterion in item 1.
If no one meets these criteria, the person responsible for the entity’s daily operations and management will be deemed as the beneficial owner.
What information must be filed?
Entities must submit detailed beneficial ownership information, including:
- Name, gender, nationality, and date of birth
- Habitual residence or employer address
- Contact details
- Type, number, and validity period of identity document
- Type of beneficial ownership, and the date when the ownership is formed and terminated (if applicable)
Implications for businesses
The regulation introduces significant compliance requirements for businesses, particularly in corporate governance. However, it also enhances transparency, reduces risks of financial crimes, and aligns with global anti-money laundering standards. Any omission or inaccurate filing will be enforced as a correction by government authority or may even have a fine of up to CNY 50,000 imposed.
How CSC can help
Navigating these requirements can be complex. CSC offers a comprehensive suite of services to ensure our clients’ compliance, including:
- Collection and verification of ownership information
- Identification of beneficial owner (BO)
- Filing preparation and submission
- Handling inquiries from government authorities
- Ongoing updates and filing if BO changes
As November 1, 2025 is the deadline for the existing entities, it’s advised for business to take actions as early as possible to ensure full compliance. CSC’s expertise and global reach make us the ideal partner to guide your organization through these changes seamlessly.
To learn more about our services or to get started, please get in touch.
