The People’s Bank of China (“PBC”) Shanghai Head Office; all branches and operations offices of the PBC; all central sub-branches of the PBC in capital cities of provinces (autonomous regions) and the central sub-branch of the PBC in Shenzhen; all state-owned commercial banks and joint-stock commercial banks; and Postal Savings Bank of China:

For the purposes of regulating the anti-counterfeit currency work of banking financial institutions and promoting the orderly development of the anti-counterfeit currency work, in accordance with the provisions of the Regulation of the People's Republic of China on the Administration of Renminbi and other relevant laws, the PBC has developed the Guidelines on the Anti-Counterfeit Currency Work of Banking Financial Institutions (see Annex), which are hereby issued to you for your compliance and implementation.

The PBC Shanghai Head Office, all branches and operations offices of the PBC, the central sub-branches of the PBC in capital cities of provinces (autonomous regions) and the central sub-branch in Shenzhen shall forward this Notice to local incorporated banking financial institutions within their respective jurisdictions.

The People’s Bank of China

February 4, 2016

Annex

Guidelines on the Anti-Counterfeit Currency Work of Banking Financial Institutions

Chapter I General Provisions

Article 1 For the purposes of specifying the functions of the anti-counterfeit currency work of banking financial institutions, regulating the anti-counterfeit currency work of banking financial institutions, strengthening the guidance to the anti-counterfeit currency work of banking financial institutions, and promoting the orderly development of the anti-counterfeit currency work of banking financial institutions, these Guidelines are developed in accordance with the Law of the People's Republic of China on the People's Bank of China, the Regulation of the People's Republic of China on the Administration of Renminbi and the Measures of the People's Bank of China for the Administration of Seizure and Authentication of Counterfeit Currency (Order No. 4 [2003], PBC).

Article 2 These Guidelines shall apply to the banking financial institutions formed within the territory of the People's Republic of China, which handle the currency deposit, withdrawal and exchange business.

Article 3 For the purposes of these Guidelines, “currency” means RMB issued by the PBC in accordance with the law, including banknotes and coins.

For the purposes of these Guidelines, “counterfeit currency” means forged and altered currency.

Article 4 Functions with respect to the anti-counterfeit currency work that banking financial institutions shall assume include:

(1) Implementing the laws, regulations and rules of the state on anti-counterfeit currency.

(2) Seizing and confiscating counterfeit currency flowing into banking financial institutions.

(3) Effectively conducting the routine management and upgrading of cash processing equipment so as to prevent the erroneous collection and payment of counterfeit currency.

(4) Conducting anti-counterfeit currency publicity activities to enhance the public's ability to fight against and identify counterfeit currency.

(5) Ensuring that cash practitioners learn and possess anti-counterfeit currency knowledge and skills.

(6) Providing clues to counterfeit currency cases to public security authorities in a timely manner, and cooperating with public security authorities in cracking down on counterfeit currency criminal activities.

Article 5 A banking financial institution shall designate a functional department to be responsible for the deployment, guidance and implementation of the anti-counterfeit currency work of its affiliated institutions and outlets.

Chapter II Routine Prevention

Article 6 A banking financial institution shall, under the principles of “assuming responsibilities by level and assigning responsibilities to specific people,” establish and improve the operating procedures for the cash business.

Article 7 A banking financial institution shall conduct full-amount clearing of currency it has paid so as to prevent the erroneous receipt and payment of counterfeit currency.

Article 8 A banking financial institution shall monitor the business of currency receipt and payment, currency counting and sorting, cash replenishment through self-service equipment, and clean-up of machines throughout the whole process.

Monitoring records shall be clear and complete, and the storage time of monitoring records shall satisfy the requirements of inspection management.

Article 9 Artificial final identification shall be conducted for the banknotes triggering an alarm in the process of receipt and payment.

Article 10 A banking financial institution shall improve anti-counterfeit currency service facilities, and equip its business outlets with the following materials and equipment:

(1) The entity's and local currency complaint hotline.

(2) Cash counting machines in compliance with quality standards.

(3) Currency publicity materials.

Article 11 A banking financial institution shall accept, investigate and handle complaints involving counterfeit currency in a timely manner, and keep a record of the complaints for recordation.

Chapter III Business Training

Article 12 A banking financial institution shall organize daily training and intensive training for the anti-counterfeit currency business, and improve the quality for the anti-counterfeit currency business of cash practitioners, so as to satisfy the requirements of the anti-counterfeit currency work.

Article 13 A banking financial institution shall include the currency receipt and payment personnel at the counter, personnel conducting clearing and counting and corresponding currency managers in the scope of anti-counterfeit currency business training.

Article 14 The anti-counterfeit currency business training of a banking financial institution shall include theoretical training and training on counterfeit currency identification skills.

Theoretical training includes basic knowledge of currency, anti-counterfeit technologies and anti-counterfeit means, counterfeit currency production techniques, production features and identification methods, laws, regulations and rules on anti-counterfeit currency, and anti-counterfeit currency work mechanism and situation, among others.

The training on counterfeit currency identification skills includes the identification of counterfeit currency and identification of features of forged or altered currency.

Article 15 A banking financial institution shall arrange for currency receipt and payment personnel at the counter, personnel conducting clearing and counting and corresponding currency managers to participate in and pass the anti-counterfeit currency business examination, and the rotation training cycle for the examination shall be three years.

In the issuance of new version of currency, a banking financial institution shall organize training and assessment in accordance with the requirements of the PBC, and effectively conduct the supporting work for the issuance of new version of currency.

Chapter IV Seizure and Identification

Article 16 A banking financial institution shall fulfill the obligation of seizing counterfeit currency in accordance with the law, regulate the seizure and identification of counterfeit currency, and protect the lawful rights and interests of currency holders.

Article 17 The seizure of counterfeit currency by a banking financial institution includes the seizure of counterfeit currency at the counter and the seizure of counterfeit currency during clearing.

The “seizure of counterfeit currency at the counter” means the seizure of any counterfeit currency found by a banking financial institution when it handles the cash business at the counter.

The “seizure of counterfeit currency during clearing” means the seizure of any counterfeit currency found by the cash processing center of a banking financial institution when it conducts cash clearing and counting.

Article 18 A banking financial institution shall seize counterfeit currency at the counter in accordance with the relevant provisions of the Regulation of the People's Republic of China on the Administration of Renminbi and the Measures of the People's Bank of China for the Administration of Seizure and Authentication of Counterfeit Currency.

Article 19 The seizure of counterfeit currency during clearing shall be handled under the following procedures:

(1) The counterfeit currency shall be seized by two or more staff members.

(2) Counterfeit currency shall be put in the special bag of uniform format, with “counterfeit currency” stamped on the seal, and the currency type, category, par value, number of pieces, currency serial number, and the name or seal of the persons who have seized the counterfeit currency as well as the reviewer, among others, indicated on the special bag.

(3) The Voucher for the Seizure of Counterfeit Currency shall be completed.

Article 20 A banking financial institution shall establish a Register for the Custody of Seized Counterfeit Currency, put the counterfeit currency in the warehouse (cabinet or chest) and assign a special person to manage it, and ensure that they are consistent with the records.

The seized counterfeit currency shall be entered in the anti-counterfeit currency information system.

Article 21 A banking financial institution shall sort out and categorize physical counterfeit currency, and deliver counterfeit currency to the local PBC branch on a monthly basis.

Article 22 A banking financial institution may conduct the currency genuineness authentication business with the authorization of the PBC branch.

A banking financial institution conducting the currency genuineness authentication business shall meet the following conditions:

(1) It has two or more currency genuineness authentication professionals who have two years or more of work experience in the cash business and have passed the training and examination of the PBC branch.

(2) It has been equipped with currency analysis and identification instrument.

(3) It has fixed currency authentication sites.

Article 23 A banking financial institution shall, in accordance with the Measures of the People's Bank of China for the Administration of Seizure and Authentication of Counterfeit Currency, accept the currency genuineness authentication applications of currency holders.

Article 24 A banking financial institution shall, according to the relevant provisions, retain the Voucher for the Seizure of Counterfeit Currency, the Currency Genuineness Authentication Certificate, and other relevant materials for five years.

Chapter V Monitoring of Counterfeit Currency

Article 25 A banking financial institution shall, under the guidance of the PBC and public security authorities, establish a counterfeit currency monitoring and response work mechanism, and provide strong information support for the resolution of counterfeit currency cases.

Article 26 A banking financial institution may establish counterfeit currency monitoring and response sites at the business outlets of the places where the specialized markets are concentrated and cash flow is relatively large within its jurisdiction.

Article 27 The counterfeit currency monitoring and response site shall be responsible for collecting the information such as that on the seized counterfeit currency, the identity of the person from whom the counterfeit currency is seized and the time of collection (see Annex 1 for the format). It shall submit the collected information to the local PBC branch at the end of each month.

Article 28 Where the counterfeit currency monitoring and response site of a banking financial institution seizes five or more counterfeit banknotes at one time at the counter, it shall immediately notify the monitoring site or economic crime investigation department of the local public security authority.

Article 29 A banking financial institution shall monitor the seizure of counterfeit currency in real time, extract valuable clues to counterfeit currency, and ensure the authenticity, objectivity and accuracy of the collected information on counterfeit currency.

Chapter VI Management of Currency Serial Number

Article 30 A banking financial institution shall carry out the work of recording and storage of and inquiry about the currency serial number of banknotes, establish and improve the rules in respect of the mechanism for producing evidence for disputes involving counterfeit currency, perform its functions in the management and use of currency serial numbers and other aspects, and regulate the work of making use of currency serial number inquiry to resolve disputes involving counterfeit currency.

Article 31 A banking financial institution shall use currency serial number recording equipment to record the currency serial number of the categories prescribed by the PBC.

Article 32 For the purposes of these Guidelines, “currency serial number recording equipment” means the cash processing equipment with currency serial number identification functions used by banking financial institutions, such as currency counting machines, automatic clearing machines and equipment, cash dispensers, and automatic teller machines.

Article 33 A banking financial institution shall develop management rules and operating procedures for such work as recording and storing currency serial numbers and using currency serial number inquiry to resolve the disputes involving counterfeit currency, establish a currency serial number retrieval system, and make an advance plan for preventing the loss of currency serial numbers.

Article 34 The elements and formats of currency serial numbers recorded by banking financial institutions and the data interface specifications shall satisfy the requirements of the PBC.

Article 35 A banking financial institution shall, after the end of each business day, keep centralized custody of the information about currency serial numbers recorded and stored on that day. The information shall be retained for at least three months.

Article 36 A banking financial institution shall establish a currency serial number inquiry information system, which shall have the following functions:

(1) Importing the original files of currency serial number records exported by the cash processing equipment.

(2) Making precise and fuzzy inquiries about recorded currency serial numbers.

(3) Exporting documents of corresponding format in accordance with the requirements of the PBC.

(4) Retaining inquiry logs.

Article 37 A banking financial institution shall, according to the match between currency serial number records and business records, post corresponding uniform signs at the conspicuous positions of three cash receipt and payment channels including cash dispensers, automatic teller machines and counters, through which currency serial numbers may be inquired.

Article 38 A banking financial institution shall, when accepting the currency serial number inquiry business, verify the valid certificates held by financial consumers (hereinafter referred to as the “inquirer”), physical counterfeit currency or the vouchers for the seizure of counterfeit currency and the certification materials for handling deposits and withdrawals, and handle the inquiry within the prescribed validity term.

Where the inquirer entrusts any other person with the inquiry, the banking financial institution shall also check the valid and legal certificate of the agent.

Article 39 For an eligible inquiry application, a banking financial institution shall complete the handling thereof within three working days after accepting the application. If the term for handling needs to be extended under any particular circumstance, the term may be extended by ten working days, and the inquirer shall be informed in advance.

Article 40 A banking financial institution shall inform the inquirer that it may file a re-inquiry application with the institution at a higher level or the local PBC branch within three working days from the date of receiving the inquiry result.

The banking financial institution accepting the re-inquiry request shall handle the request within 15 working days after accepting it. If the request cannot be handled on schedule, the term may be extended to 30 working days with the approval of the relevant person in charge, and the reasons shall be given to the inquirer. The re-inquiry result shall be notified to the inquirer in the form of the inquiry result notice.

Article 41 A banking financial institution shall establish an inquiry register to record the information on the handling person and the reviewer of each inquiry service, the inquiry number, the inquiry time, the inquiry result, and other information.

The inquiry and re-inquiry application forms and the written notices on the inquiry results shall be bound in a categorized manner and be retained for two years.

Article 42 Each outlet of a banking financial institution shall designate special persons to be responsible for the retrieval with respect to the currency serial number inquiry information system, and master the retrieval methods of the currency serial numbers recorded and stored in various forms. The retrieval work shall realize two functions, that is, precise retrieval and fuzzy retrieval. The currency serial number retrieval business register shall be established to record the information on the handling of each retrieval business.

Chapter VII Anti-Counterfeit Currency Publicity

Article 43 A banking financial institution shall fulfill its anti-counterfeit currency publicity responsibilities and obligations, promote the public's enhancement of their anti-counterfeit currency awareness, and improve their capability to identify counterfeit currency.

Article 44 A banking financial institution shall, in accordance with the principles of compliance with laws and regulations, correct orientation, highlighting innovation and paying attention to actual effects, organize anti-counterfeit currency publicity in light of local currency circulation features and the anti-counterfeit currency situation.

Article 45 A banking financial institution shall publicize the laws and regulations and rules on anti-counterfeit currency, anti-counterfeit currency knowledge, and the methods and techniques for identifying counterfeit currency, among others.

Article 46 A banking financial institution shall guarantee the input for anti-counterfeit currency publicity, make annual publicity plans, and reasonably allocate publicity materials and equipment to all business premises and publicity sites to satisfy the requirements for anti-counterfeit currency publicity.

Article 47 A banking financial institution shall, based on business premises, establish and improve publicity sites of urban communities and rural townships, and conduct anti-counterfeit currency publicity through business premises, publicity sites, communities, sub-districts, schools, enterprises, rural areas, and other channels.

Article 48 A banking financial institution shall actively carry out routine publicity activities and organize and carry out intensive publicity activities in accordance with the unified arrangements of the PBC. The publicity activities shall take into consideration the local conditions, emphasis on innovation and take multiple forms.

Article 49 A banking financial institution shall not, in public occasions or through open channels, publish opinions that are contrary to the existing anti-counterfeit currency policies of the state and the opinions that damage the currency image.

Chapter VIII Management of Machines and Equipment

Article 50 A banking financial institution shall adhere to the principles of accurate identification, advanced technologies, reliable technologies, and stable performance, establish rules for the management of cash processing machines and equipment, and regulate the selection, allocation, use and relevant management of cash processing machines and equipment, so as to ensure the normal operation of all functions of cash processing machines and equipment and satisfy the requirements of the anti-counterfeit currency work.

Article 51 For the purposes of these Guidelines, “cash processing machines and equipment” means currency counting machines, cash clearing and processing equipment, and cash self-service equipment, among others, that are used by banking financial institutions and satisfy anti-counterfeit currency requirements.

Article 52 The cash processing machines and equipment selected by banking financial institutions shall comply with the national standards, industry standards or relevant management requirements.

Article 53 A banking financial institution shall check the counterfeit detection functions of cash processing machines and equipment before putting them into use. It shall establish a machine and equipment maintenance register for the cash processing machines and equipment that have been put into use (see Annex 2 for the format), and conduct the sampling inspection of counterfeit detection functions once every half a year, and the sampling inspection rate shall not be lower than 10% of the total amount of cash processing machines and equipment.

The banking financial institution shall require suppliers to maintain the machines and equipment that are found upon inspection to have failed to meet relevant standards or failed to satisfy the requirements of the anti-counterfeit currency work, and shall not use them if they fail to meet the standards after maintenance or fail to satisfy the requirements of the anti-counterfeit currency work.

Article 54 A banking financial institution shall, before purchasing cash processing machines and equipment by bidding, make plans for the inspection of cash processing machines and equipment by reference to national standards, industry standards or relevant management requirements, organize inspection, and notify the inspection information and result to the PBC Head Office or PBC branch.

Article 55 A banking financial institution may borrow the inspection samples of cash processing machines and equipment from the local PBC branch. On the basis of inspection samples provided by the PBC, the scope of inspection samples may be increased.

Article 56 A banking financial institution shall, in light of the changes in currency anti-counterfeiting technologies and the actual circumstances of anti-counterfeit currency work, upgrade the technologies of cash processing machines and equipment in a timely manner. It shall suspend the use of cash processing machines and equipment which fails to identify new-version currency and counterfeit currency, and immediately upgrade such machines and equipment and similar types of machines and equipment. It shall not use the machines and equipment that fail to satisfy the requirements of the anti-counterfeit currency work after upgrading, and shall report the upgrading and other relevant information to the local PBC branch.

Chapter IX Information Management

Article 57 A banking financial institution shall collect, review and report the information on the anti-counterfeit currency work in a timely manner so as to realize information sharing.

Article 58 The “information on the anti-counterfeit currency work” means the information related to the anti-counterfeit currency which occurs in the daily work by means of data, text, sound, image or other carriers or their combinations. The information on anti-counterfeit currency is divided into general information and sensitive information.

General information includes seizure and authentication, currency serial number inquiry, publicity and training, management of machines and equipment, and work exchange, among others.

Sensitive information includes the discovery of 20 or more counterfeit RMB banknotes (coins) and ten or more counterfeit foreign banknotes (coins) by a banking financial institution at one time, or any event of making a payment to the public with counterfeit currency or counterfeit currency loss, and information on counterfeit currency involving the entity released by the media.

Article 59 A banking financial institution shall report the information on the anti-counterfeit currency work level by level, and report it to the local PBC branch in a timely manner.

Article 60 The requirements for the submission of information on the anti-counterfeit currency work are:

(1) General information: the banking financial institution shall report such information in accordance with the relevant provisions of the PBC.

(2) Sensitive information: the banking financial institution shall submit the information in the fixed format (see Annex 3) to the local PBC branch within one working day after the occurrence of the incident.

Article 61 Without the approval of the PBC, no banking financial institution may release to the public any information on counterfeit currency.

Chapter X Supervision and Administration

Article 62 A banking financial institution shall establish and improve the anti-counterfeit currency supervision and administration mechanism featuring reasonable division of work, clear functions and clear reporting relationships, specify the functions, procedures and rules for anti-counterfeit currency supervision and administration, and regulate the anti-counterfeit currency work.

Article 63 A banking financial institution shall conduct on-site or off-site inspection on the anti-counterfeit currency business at least once each year.

Article 64 A banking financial institution shall conduct supervision and examination of its and its affiliated institutions' anti-counterfeit currency business on an annual basis.

Article 65 A banking financial institution shall establish a reward mechanism for the anti-counterfeit currency work, and reward the entities and individuals that have made outstanding achievements.

Article 66 A banking financial institution shall submit rectification plans and take rectification measures within the prescribed time limit with respect to the regulatory violations discovered by the PBC in anti-counterfeit currency supervision and administration.

Chapter XI Supplementary Provisions

Article 67 The relevant clauses of these Guidelines shall apply, mutatis mutandis, to the anti-counterfeit foreign currency work conducted by banking financial institutions according to their own business operations.

Article 68 These Guidelines shall be subject to interpretation by the PBC.

Article 69 These Guidelines shall come into force on the date of issuance.

Annexes:

1. Information Collection Form of Counterfeit Currency Monitoring and Response Sites (omitted)

2. Cash Processing Machine and Equipment Maintenance Register (omitted)

3. Sensitive Information Submission Form (omitted)