The new regulations came on July 1st! Is personal overseas investment loose or tight? Recently, the State Council officially issued the "Regulations on Foreign Investment", which is the first administrative regulation specifically governing overseas investment and will come into effect on July 1st. Simply put, this time individual residents have also been officially included in the regulatory scope. Previously, they mainly managed enterprises, but now individual overseas investments must also follow the new rules. The overall direction is to support reasonable overseas expansion while strengthening compliance supervision, shifting from vague areas to clear rules. What does the new regulation mainly talk about? one ️⃣ The first clarification of personal identity: Residents who make cross-border investments must undergo identity verification. In the future, requirements for information disclosure, funding sources, and anti money laundering will become stricter, and compliance costs will definitely increase. two ️⃣ Expansion of regulatory scope: not only managing money and equity, but also extending to "people". For example, without permission, it is not allowed to send people or provide technical guidance to transfer restricted technology. three ️⃣ Penetrating regulation: focus on "direct or indirect" control. Offshore companies, trusts VIE、 Multi layer SPV and other architectures will depend on who the ultimate actual controller and beneficiary are, appearances are useless, it depends on the essence. four ️⃣ Fines for violations are clearer: Penalty: confiscation of illegal gains+a fine of 1% -10% of the investment amount. Prohibited investment: In severe cases, external investments cannot be made for 1-3 years. Overall, it's not a one size fits all ban on everyone going out to sea, but rather turning gray things into white and making the path to compliance clearer. However, the cost of violating regulations has clearly increased. The impact on ordinary mainland users one ️⃣ In the future, personal purchases of overseas properties, stocks, funds, establishment of companies, trusts, etc. will be considered as external investments. two ️⃣ The annual foreign exchange purchase limit of $50000 cannot be used for these capital investments, and the risk of going through the gray channel in the past is now higher. three ️⃣ The detailed rules have not been fully formulated in the short term, and there will be no immediate requirement for large-scale reporting. However, the regulatory framework has been established, and the penetration review will gradually strengthen. Suggestion: Friends who have plans to go abroad should quickly organize their structure during the window period to ensure that the ultimate beneficiaries are clear and the funds are legal. It is best to go through formal channels such as QDII, prioritize compliance, and operate rationally. The impact on cryptocurrency users one ️⃣ Although cryptocurrency is not directly named in the new regulations, its impact is still significant because it is already a strictly regulated field (classified as illegal financial activities in the September 24, 2021 notice). two ️⃣ After the new regulations are added: By holding or trading on overseas exchanges, wallets, DeFi, it is easy to be seen as "indirect overseas investment", and it is easier to be detected by penetrating hidden structures under supervision. three ️⃣ Large scale fund inflows and outflows (especially USDT, etc.), technical support, project promotion, and other behaviors will face stricter foreign exchange and anti money laundering reviews. four ️⃣ Once identified as a violation, in addition to the previous punishment, there may be an additional financial penalty plus a 1-3 year ban on investment. Practical suggestion: Ordinary retail investors: Holding low profile is not a problem, but do not frequently engage in large transactions. The source of funds should be clean. The project party 关键意见领袖 Practitioners: Special caution should be taken when dealing with domestic user services, technology output, etc. The overall trend is to further narrow the gray space, and it is strongly recommended that everyone prioritize the compliance path. If you are really unsure, please consult a professional lawyer. Overall, compliance is the king after July 1st. It is still possible to legally go abroad, but transparency and regulatory requirements have increased. Friends in the cryptocurrency industry should be more cautious and not take chances. The purpose of policies is to regulate the market, not to completely block it. Everyone should take a rational view and prepare in advance.