Physical settlement of crude oil futures contracts will be through the delivery of standard warrants representing crude oil, of the requisite grade, stored in bonded oil-storage facilities designated by the INE.

Although offshore access to futures markets for crude oil is not governed by the highest level of Chinese law, policies supporting offshore access to the futures markets were published in 2015, specifically targeting crude oil and iron ore, and have assisted in creating the necessary legal framework to enable offshore market participation. Among others, these policies provide for the VAT-free delivery of crude oil futures and provide the necessary conditions for access by overseas market participants.

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