Chinese copper imports are expected to come under renewed pressure as foreign exchange rules limit scope to use the metal as a financing vehicle, Dow Jones reported. Imports have been weakening since late 2010, but traders fear worse is to come as Beijing clamps down on companies using letters of credit or deferred payments to generate funds pre-delivery. Standard Bank estimates that 40-80% of the 600,000 metric tons of copper that has accumulated since October 2010 in bonded warehouses – where it is exempt from China’s 17% value-added tax – is tied to this financing mechanism. Under the new rules, companies that re-export copper are required to wait until contracts have been delivered before settling or transferring foreign exchange earnings. Export revenue must also be audited before being converted into local currency. Deferred payments and advance payments can be made on only 20% of the value of a company’s imports from the previous 12 months, down from 25%.