Under a pilot scheme restricted to Shanghai's fast-growing Pudong area, qualified multinationals would be allowed to open accounts at domestic banks to centralise their treasury operations, China's foreign exchange regulator said.
Chinese subsidiaries of multinationals would be allowed to lend foreign exchange to their overseas counterparts, the State Administration of Foreign Exchange (SAFE) said in a statement in Chinese on its Web site, www.safe.gov.cn.
Foreign investors would be permitted to exchange their yuan profits into foreign currency and lend the money to overseas units, the SAFE said. They can enter yuan forwards and swaps.
Multinationals have set up 60 regional headquarters in Shanghai's Pudong area, which "pose challenges to the existing policy environment and management mechanism", the agency said.
The statement did not make clear when the changes would take effect or whether they were already in operation for the 60 firms.
The authorities would also relax controls on Chinese multinationals to let them make loans to overseas subsidiaries to support their "outward-bound" strategy, the statement said.
The yuan is convertible on the current account, which covers trade, but China still restricts most capital-account deals.