On September 16, China will implement new rules governing how banks are allowed to participate in China’s rapidly growing financial derivatives markets. In addition to various bureaucratic requirements, domestic banks want their foreign counterparts to guarantee the credit of their subsidiaries in China. Unsurprisingly, foreign bankers are quite concerned that this violates the "equal treatment" principle – "It defeats the purpose of a local subsidiary!" complained one source who works for a foreign bank in Shanghai – but Chinese bankers are also concerned that the funds they sank into Western financial titans like A-rated Lehman Brothers vanished without a trace, defeating the purpose of having a ratings system. Perhaps they are also concerned that Western banks might be inspired by the example of SASAC, which said it is going to allow certain SOEs to default on commodity derivatives contracts they didn’t understand – a dangerous precedent, to say the least. Foreign investors are also interested in the bankruptcy proceedings of Taiwan-based galvanized-steel maker FerroChina, which is seen as a test of China’s 2007 bankruptcy law. Under the deal, which one observer called a "reasonable outcome," some foreign creditors will recoup as much as 60% of their debts, while others, such as foreign holders of FerroChina’s outstanding bonds, will receive nothing. At the macroeconomic level, China has put its forex where its mouth is, and agreed to buy US$50 billion worth of bonds denominated in the International Monetary Fund’s Special Drawing Rights (SDRs), a step toward offsetting its dependence on dollar-denominated instruments.