Chinese banks have introduced territorial restrictions for Russia’s business partners

They cannot open accounts outside “their” province. At the same time, due to the banks’ regular refusal to make payments to suppliers from China, they often have to open new accounts in financial institutions that continue to accept money from Russia.

There are already many such cases, but it is still difficult to assess their scale and there is no official data, said Andrey Gusev, managing partner of Nordic Star law firm. Moreover, incidents may depend on the position of specific banks or provincial authorities.

There is also an example. According to Gusev, a supplier from Sichuan province, with whom one of the importers works, decided to open an account in one of the banks in Shandong province, but was refused, as it was decided to open accounts only for local companies. In the same region, another interlocutor faced a similar problem. Some Chinese banks began to introduce such territorial restrictions in April-May.

Another importer’s supplier also did not open an account on this basis. Officially, bankers cannot refuse to carry out this operation, but they suggest waiting six months to open an account and then the same amount, which may not be acceptable for business.

Since late August, Chinese banks have been returning payments to importers from the Russian Federation even for goods already received, several businessmen said. Various reasons are cited: from inconsistencies in the data in documents and errors in details to the need to apply sanctions.