The Chinese government has issued new regulations for the management of foreign labor service enterprises to protect workers sent overseas and boost the development of foreign labor cooperation.

The regulations, which will go into effect starting on Aug. 1, were posted on the central government’s website on Monday.

Foreign labor service enterprises will each be required to create a bank account containing no less than 3 million yuan (US$47.62 million) to be deposited in banks designated by authorities in order to cover potential risks, according to the new rules.

The funds will mainly be used to cover service fees, wages, compensation for losses and emergency expenses when labor service enterprises fail to pay, the circular said.

Foreign labor service providers are not allowed to charge any service fees or ask for deposits or financial guarantees from the workers they have signed labor contracts with, the circular said.

Foreign labor service corporations should not allow other companies or individuals to recruit workers on their behalf or allow their employees to work for businesses related to gambling or pornography, it said.

Foreign labor service corporations should also buy personal accident insurance for their workers, except when foreign employers have promised to cover insurance fees, the circular said.

Foreign labor service companies should send administrative staff to accompany teams of overseas workers consisting of more than 100 people, according to the regulations.

They should also help workers protect their legal rights, the regulations said, adding that companies will be obliged to provide compensation that foreign employers fail to provide.