JC Master Legal News Issue 1202

  Key Takeaways for This Issue

The draft Financial Law is now open to public consultation.

Recently, the Ministry of Justice and four other departments released the “Financial Law of the People’s Republic of China (Draft)” (hereinafter referred to as the “Draft”), inviting public comments. The deadline for submitting feedback is April 19.

The Ministry of Industry and Information Technology has launched the 2026 certification and re‑evaluation process for “Little Giant” enterprises specializing in niche fields.

On March 23, the General Office of the Ministry of Industry and Information Technology issued the “Notice on Conducting the Recognition and Re‑examination of Specialized, Sophisticated, Distinctive, and Innovative ‘Little Giant’ Enterprises for 2026.”

The National Medical Products Administration has issued a notice soliciting public comments on the establishment of a pharmaceutical traceability system.

On March 23, the Comprehensive Department of the National Medical Products Administration drafted and publicly solicited comments on the “Notice of the Comprehensive Department of the National Medical Products Administration on Accelerating the Development of a Drug Traceability System (Draft for Comments).” The period for submitting feedback is from March 24 to April 23.

Finance and Capital Markets

FINANCE & CAPITAL MARKETS

The draft Financial Law is now open to public consultation.

Recently, the Ministry of Justice and four other departments released the “Financial Law of the People’s Republic of China (Draft)” (hereinafter referred to as the “Draft”), inviting public comments. The deadline for submitting feedback is April 19.

The Draft comprises 11 chapters and 95 articles, setting forth the following key provisions: First, it clarifies the overarching, directional requirements for financial work. Second, it establishes a modern central banking system. Third, it regulates the conduct and activities of financial institutions. Fourth, it enhances the standardization of financial products and services. Fifth, it optimizes the functions of the financial market system. Sixth, it comprehensively strengthens financial supervision. Seventh, it improves the mechanisms for managing and resolving financial risks. Eighth, it coordinates high-quality financial development with financial security. Ninth, it reinforces legal accountability. The Draft mandates full‑cycle management of financial institutions throughout their admission, operations, and exit phases, stipulating that the establishment of financial institutions and their branches, as well as any material changes thereto, must be subject to approval. It also proposes the establishment and improvement of risk‑management systems for operators of financial infrastructure, thereby strengthening safeguards for the timely and reliable performance of financial infrastructure services.

Business and Corporations

COMMERCIAL & CORPORATE

The State Administration for Market Regulation has ceased implementing the evaluation and certification of standard‑innovation‑oriented enterprises.

Recently, the State Administration for Market Regulation issued the “Notice on Ceasing the Implementation of the Evaluation and Certification of Standard‑Innovative Enterprises.”

The notice clarifies the following: First, the “Administrative Measures for the Tiered Cultivation of Standard‑Innovative Enterprises (Trial)” (Guo Shi Jian Biao Chuang Gui [2023] No. 4) is hereby repealed, and no related administrative activities shall be conducted under this measure as of the date of its issuance. Second, market regulation authorities at all levels are required to cease all procedures and project arrangements pertaining to the tiered cultivation of standard‑innovative enterprises, and to notify enterprises that have already completed the evaluation that, effective immediately, they may no longer engage in any production or business activities, promotional campaigns, or applications for awards and honors under the designation “Standard‑Innovative Enterprise.” Furthermore, such entities shall not display, exhibit, or use plaques, certificates, or other markings associated with the “Standard‑Innovative Enterprise” designation. Third, market regulation authorities at all levels are tasked with providing appropriate explanations and communication to the relevant enterprises and carrying out follow-up measures to ensure that all related evaluation and certification activities are terminated in accordance with the provisions of this notice.

The Ministry of Industry and Information Technology has launched the 2026 certification and re‑evaluation process for “Little Giant” enterprises specializing in niche fields.

On March 23, the General Office of the Ministry of Industry and Information Technology issued the “Notice on Conducting the Recognition and Re‑examination of Specialized, Sophisticated, Distinctive, and Innovative ‘Little Giant’ Enterprises for 2026.”

The Notice, in accordance with the Measures for the Hierarchical Cultivation of High‑Quality SMEs, clarifies the procedures for the recognition of the eighth batch of “Little Giant” enterprises specializing in niche fields and demonstrating innovation, as well as the review arrangements for enterprises recognized or re‑certified in 2023. Provincial-level specialized, refined, distinctive, and innovative SMEs may apply for recognition, while the fifth batch of such enterprises and the second batch that have passed re‑certification are eligible to apply for re‑review. Online submission will be open from April 25 to May 25, 2026, and paper documents must be submitted in accordance with local requirements. Applying enterprises must meet the criteria set forth in the Measures; financial data shall be based on audited reports that have been filed and assigned a code on the Ministry of Finance’s unified supervision platform, and original electronic copies must be uploaded. Enterprises are no longer required to provide third‑party evidence of market share or certain patent certificates; relevant data will be verified through information sharing with the National Intellectual Property Administration and other authorities. The Ministry of Industry and Information Technology plans to leverage data extraction, artificial intelligence, and big data to strengthen anti‑fraud reviews, and will take lawful action against enterprises and accounting offices found to have falsified data or fraudulently obtained funds. Each provincial SME authority is responsible for preliminary review and recommendation, public announcement, and record‑keeping of application materials. Regions with a large number of recommendations but a low pass rate will face point deductions or quota restrictions in related support policies. Enterprises that hold controlling interests in, or belong to the same group as, already‑recognized “Little Giant” companies, or that produce similar flagship products, shall not be recommended. Provincial authorities must conduct centralized recommendation and public announcement between May 25 and June 30, 2026, and submit formal recommendation documents and summary tables by June 30. Re‑reviews shall follow the principle of “re‑evaluating only at the highest applicable designation level.” For enterprises that fail the re‑review, the provincial authorities shall, concurrently with this round of submissions, carry out a re‑review of specialized, refined, distinctive, and innovative SMEs. The designations of enterprises recognized or re‑certified in 2023 will remain valid until the issuance of the next re‑review list; thereafter, the new list shall prevail.

The National Medical Products Administration has issued a notice soliciting public comments on the establishment of a pharmaceutical traceability system.

On March 23, the Comprehensive Department of the National Medical Products Administration drafted and publicly solicited comments on the “Notice of the Comprehensive Department of the National Medical Products Administration on Accelerating the Development of a Drug Traceability System (Draft for Comments).” The period for submitting feedback is from March 24 to April 23.

The document centers on end-to-end traceability across all pharmaceutical products and the entire supply chain, requiring marketing authorization holders, domestic responsible parties, manufacturers, distributors, and users to complete registration of product traceability codes and implement the principle of “one code per product, with traceability linking product and code.” It mandates that, at every stage—production, wholesale, retail, and use—every product be assigned a unique code, activated, scanned throughout the supply chain, and have its traceability information uploaded. Furthermore, traceability activities are to be integrated into the quality management system. The notice underscores that operators of traceability systems must adhere to a public‑interest orientation, ensure data security, and provide support for product recalls and early warning. It also encourages the adoption of digital and intelligent technologies capable of handling multiple code formats to promote deep integration between ERP, WMS, SCM, and other systems and the pharmaceutical traceability system. At the same time, drug regulatory authorities at all levels are required to strengthen oversight and coordination across departments, leveraging traceability data for risk‑based early warning and joint regulatory efforts.

The Ministry of Industry and Information Technology is promoting the digital transformation of enterprises in industrial parks.

On March 24, the Ministry of Industry and Information Technology announced via the Chinese Government Website that it will accelerate the implementation of digital transformation among enterprises in more industrial parks.

The Ministry of Industry and Information Technology has proposed accelerating the digital transformation of enterprises across production, operations, and other business processes within industrial parks, encouraging more companies to leverage digital technologies to enhance their management and operational capabilities. These measures will be rolled out to enterprises in various types of industrial parks, further advancing the digital transformation of the industrial sector.

The General Administration of Customs has clarified the simplified review procedures for certified high‑level enterprises.

On March 26, the General Administration of Customs issued Announcement No. 31 of 2026, titled “Announcement on Implementing Simplified Re‑inspection for Authorized Economic Operators.”

The announcement stipulates that customs may apply a simplified review procedure when re‑examining advanced certified enterprises rated as “Excellent” or “Good.” Enterprises currently under audit, risk‑based verification, criminal or administrative investigations, or subject to overseas notifications regarding their export goods are, in principle, excluded from this simplified process—except in cases involving voluntary self‑reporting, approved self‑inspection, or simplified‑procedure case initiation. For “Excellent” enterprises, no on‑site review will be conducted; a favorable decision will be issued directly. For “Good” enterprises, on‑site reviews will be limited to certification criteria that affect the credit rating and to the most recent instance of “basically compliant” status. If, during the simplified review, it is determined that an enterprise no longer meets the eligibility requirements or has undergone significant changes, the review may be terminated and converted to a standard review. This regulation takes effect on April 1, 2026.

Taxation

TAXATION

The State Taxation Administration and eight other departments have launched the “Spring Rain Nourishes Seedlings” special campaign.

Recently, the State Taxation Administration and eight other departments issued a notice to launch the 2026 “Spring Rain Nurtures Seedlings” special campaign aimed at supporting the development of small and micro business entities.

The Notice introduces 15 packages of 50 service measures, covering streamlined processing for business establishment, inter‑district relocation, and deregistration; upgrading the “one‑stop joint service” for social security and medical insurance; intensifying support and capacity‑building for individual‑to‑enterprise conversions; and launching initiatives such as SME Service Month and Individual Business Household Service Month. It also integrates business‑friendly policies and service measures, promotes compliance‑related alerts and reminders, and deepens “bank‑tax collaboration.” Furthermore, it strengthens policy guidance for science and technology incubators and their resident enterprises, advances industry‑university‑research matchmaking and technology transfer services, refines the green tax system, enhances the cross‑border business “Tax‑Pathway” platform, and provides integrated services for agriculture‑related entities. Finally, it establishes robust mechanisms for regular communication, data‑sharing applications, and coordinated responses to public concerns.

Litigation and Arbitration

LITIGATION & ARBITRATION

The Supreme People’s Court has released the sixth batch of typical cases on judicial protection of intellectual property in the seed industry.

Recently, the Supreme People’s Court selected 10 typical cases of judicial protection of intellectual property rights in the seed industry from among the cases concluded by courts nationwide in 2025.

This batch of typical cases primarily comprises civil and administrative matters. Among them, there are nine civil tort cases and one administrative penalty case involving new plant varieties. The civil cases address a range of infringing practices, including “brand‑hijacking” infringement, infringement through “white‑bag” packaging, storage‑based infringement, and import‑related infringement. The varieties at issue span major crops such as rice, wheat, corn, and soybeans, as well as vegetables and fruits like tomatoes, apples, and pomegranates. Through this set of cases, the Supreme People’s Court has underscored its commitment to strengthening protection, innovating protective measures, continuously refining adjudicatory rules in seed‑industry disputes, and steadily expanding the scope of protection.

The Supreme People’s Procuratorate has issued new guidelines on procuratorial transparency to standardize the disclosure of information.

Recently, the Supreme People’s Procuratorate issued the “Opinions on Deepening and Standardizing the Work of Procuratorial Transparency.”

The “Opinions” set forth 20 measures across five areas, focusing on improving the entities, scope, methods, and mechanisms for publicizing procuratorial affairs: First, adhering to the principle of “whoever is in charge bears responsibility,” it designates the procuratorate that generates procuratorial information as the entity responsible for disclosure, and specifies ten categories of matters that must be proactively disclosed—namely, basic functions, organizational structure and personnel, budgets and final accounts, case information, guiding cases, litigation procedures, and convenience‑oriented information. It also lists key types of case information, major business data, prosecutorial legal documents, and inspection and oversight findings that may be disclosed at discretion, while strictly delineating the scope of information that shall remain confidential, including state secrets, commercial secrets, personal privacy, and cases involving minors. Second, with respect to disclosure channels, it strengthens notification of litigation rights and obligations and the provision of updates on petition handling; refines the integrated offline, cross‑jurisdictional, and online mechanism for accessing case files; coordinates the functions of the 12309 physical service hall and online platforms; promotes all‑media communication and policy interpretation; and requires that major, sensitive cases have their information released centrally through authoritative channels, with proactive responses to public opinion. Third, at the institutional level, it reafoffices strict compliance with relevant regulations on the disclosure of case information, establishes a system of accountability for the public release of prosecutorial legal documents, along with legal interpretation and reasoning, confidentiality reviews of information releases, and content‑review responsibilities; improves mechanisms for gathering public input and assessing prosecutorial credibility; and incorporates procuratorial transparency into Party group deliberations and education‑training programs, while advancing the application of digital technologies and performance‑evaluation frameworks. The Opinions take effect from the date of promulgation and repeal the four existing normative documents on procuratorial transparency.

The Supreme People’s Procuratorate has issued guidelines on studying and implementing the procuratorial duties stipulated in the Ecological and Environmental Code.

Recently, the Supreme People’s Procuratorate issued the “Notice on Earnestly Studying and Implementing the Ecological and Environmental Code.”

The Notice sets out measures in response to the new requirements imposed by the Ecological and Environmental Code on the performance of procuratorial duties, specifying that crimes harming the ecological environment shall be severely punished in accordance with the law; strengthening oversight of civil cases involving environmental pollution and ecological torts; improving end-to-end supervision of administrative final judgments, trial procedures, and enforcement activities; and continuously bolstering public-interest litigation in the field of ecological and environmental protection. At the same time, it calls for refining mechanisms related to assessing the “justiciability” of public-interest lawsuits, ensuring seamless coordination between compensation for ecological and environmental damage and procuratorial civil public-interest litigation, fostering two-way linkage between administrative law enforcement and criminal justice, promoting coordinated performance of duties across the “four major areas of procuratorial work,” and enhancing cross-regional cooperation.