I. Legal status of foreign exchange transactions
Foreign exchange transaction itself: Foreign exchange transaction itself has not been listed as an illegal object by our laws. In other words, individuals are not prohibited from participating in foreign exchange transactions. Therefore, it is neither legal nor illegal for individuals to conduct foreign exchange transactions in China.
Foreign situation: In foreign countries, foreign exchange speculation is legal, and there are regulatory agencies similar to the CSRC to supervise it, such as foreign futures associations and the Financial Supervisory Authority of the United Kingdom, to ensure the safety and legitimacy of foreign exchange platforms.
2. Legal channels for foreign exchange transactions
Formal platform: It is legal to conduct foreign exchange transactions on legal foreign exchange trading platforms or banks. These platforms or banks are usually supervised by relevant regulatory agencies, with clear trading rules and risk management measures.
Illegal acts: Although foreign exchange trading itself is not illegal, there are some illegal acts, such as unauthorized institutions or individuals providing illegal foreign exchange trading services, and illegal foreign exchange trading platforms involve money laundering, illegal fund-raising and other criminal acts. These illegal acts are not allowed by law.
Three. Relevant provisions of China Municipality on foreign exchange control.
New regulations: China foreign exchange management will implement a series of new regulations and guidelines in 2024, aiming at optimizing the management of foreign exchange business in capital projects, improving the facilitation level of cross-border investment and financing, and simplifying business processes.
Personal foreign exchange business: individuals shall abide by the Measures for the Administration of Personal Foreign Exchange and other relevant regulations when handling foreign exchange business. If the personal settlement and sale of foreign exchange is subject to the annual gross management, those within the annual gross shall be handled in the bank with their valid identity documents; If it exceeds the annual total amount, it shall be handled at the bank with my valid identity certificate and relevant certificates of the transaction amount under the current account, and it shall be handled in accordance with relevant regulations under the capital account.
Four, how to avoid the illegal risks of foreign exchange transactions
Choose a formal platform: when conducting foreign exchange transactions, you should choose a formal foreign exchange trading platform or a bank supervised by a regulatory agency.
Understand the trading rules: before participating in foreign exchange trading, you should understand the trading rules and risk management measures of the platform to ensure that you understand and can bear the trading risks.
Beware of illegal acts: beware of illegal acts such as false propaganda and fraud to avoid losses. At the same time, if illegal foreign exchange transactions are found, they should be reported to the relevant regulatory authorities in a timely manner.
To sum up, it is not illegal for individuals to conduct foreign exchange transactions, but they should abide by relevant laws, regulations and provisions, choose a formal platform for trading, and pay attention to preventing illegal foreign exchange trading activities.