JC Master Legal News Issue 914

Key Takeaways for This Issue

The China Banking and Insurance Regulatory Commission has issued the Measures for Systematic Economic Accountability Audits.

Recently, the China Banking and Insurance Regulatory Commission issued the Measures for Auditing the Economic Responsibilities of Principal Leading Cadres and Leaders within the System (hereinafter referred to as the “Measures”). These measures are designed to effectively enhance the efficacy of audit oversight in advancing the Commission’s efforts to ensure strict Party self‑discipline across the board, strengthen the supervision and management of its cadre workforce, and improve the standardization and effectiveness of financial regulatory work. They also aim to guide audited entities to further规范ize the exercise of power, elevate their organizational and management standards, and thereby better serve the real economy while preventing and defusing financial risks.

The Ministry of Commerce has issued a notice on further advancing reform and opening-up and ensuring stable foreign investment in response to the epidemic.

On April 1, the Ministry of Commerce issued the “Notice on Further Advancing Reform and Opening-Up and Ensuring Stable Foreign Investment in Response to the Epidemic,” outlining 24 specific measures and work requirements across five key areas to guide current and year‑long efforts to stabilize foreign investment.

Ministry of Finance: Enhancing Credit Support for Financing to Small and Micro Enterprises and Agricultural, Rural, and Farmer Entities

Recently, the Ministry of Finance issued the “Notice on Fully Leveraging the Role of Government‑Backed Financing Guarantees to Enhance Credit for Small and Micro Enterprises and Entities in Agriculture, Rural Areas, and Farmers” (hereinafter referred to as the “Notice”).

Premier Li Keqiang signed a State Council Order promulgating the “Decision of the State Council on Amending and Repealing Certain Administrative Regulations.”

According to a report by China National Radio’s “News and Newspaper Digest,” Premier Li Keqiang recently signed a State Council decree promulgating the “Decision of the State Council on Amending and Repealing Certain Administrative Regulations” (hereinafter referred to as the “Decision”), which shall take effect from the date of its publication.

International public opinion is closely following China’s nationwide mourning ceremony.

On April 4, China held a nationwide mourning ceremony to honor the martyrs who died in the fight against the COVID-19 pandemic and the compatriots who passed away, drawing widespread international attention.

Table of Contents

Table of Contents

Finance & Capital Markets

The China Banking and Insurance Regulatory Commission has issued the Measures for Systematic Economic Accountability Audits.

The China Banking and Insurance Regulatory Commission has issued the “Notice on Issues Related to Rate Adjustments for Long-term Medical Insurance Products.”

The China Securities Regulatory Commission stated: It strongly condemns Luckin Coffee’s financial fraud.

In the first quarter of 2020, the New Third Board market operated steadily, and the effects of reform gradually became apparent.

The Shanghai Stock Exchange has issued the Draft Measures for the Implementation of Share Reduction by Shareholders of STAR Market Listed Companies through Non‑Public Transfers and Allotments.

Corporate & Commercial

The Ministry of Commerce has issued a notice on further advancing reform and opening-up and ensuring stable foreign investment in response to the epidemic.

Two departments: Projects fostering deep integration between the express delivery sector and the manufacturing industry will receive financial support.

Shanghai has issued new regulations to support the development of electric vehicle charging infrastructure.

China Securities Depository and Clearing Corporation has implemented a range of measures to continuously enhance its securities inquiry services.

The People’s Bank of China: In the first quarter, the issuance and net financing volume of corporate credit bonds increased significantly year on year.

Taxation

Ministry of Finance: Enhancing Credit Support for Financing to Small and Micro Enterprises and Agricultural, Rural, and Farmer Entities

The resumption rate of industrial enterprises above designated size in Wuhan stands at 97.2%.

You may waive a personal income tax refund; unpaid personal income tax will incur late payment penalties.

In the first two months, nationwide tax and fee reductions totaled 402.7 billion yuan, and there is still room to further strengthen proactive fiscal policy.

China’s first first-loan service center has begun operations in Beijing, with 22 banks already on board.

Litigation & Arbitration

Premier Li Keqiang signed a State Council Order promulgating the “Decision of the State Council on Amending and Repealing Certain Administrative Regulations.”

The Supreme People’s Court has issued a document to advance the modernization of the judicial system and judicial capacity.

The Ministry of Public Security has introduced ten measures to crack down, in accordance with the law, on crimes in the areas of food, drugs, the environment, and intellectual property.

A fan was found to have infringed upon rights after posting inappropriate remarks on the “DongqiuDi” app.

Second-instance verdict delivered in the case of dereliction of duty involving public officials related to the “sports field body‑burial case”

Other

International public opinion is closely following China’s nationwide mourning ceremony.

Finance & Capital Markets

The China Banking and Insurance Regulatory Commission has issued the Measures for Systematic Economic Accountability Audits.

To earnestly implement the important instructions of General Secretary Xi Jinping—“strengthen the overall coordination of audit work, optimize the allocation of audit resources, and strive to build an audit oversight system that is centralized and unified, comprehensively inclusive, authoritative, and efficient”—and to ensure the thorough implementation of the Regulations on Economic Accountability Audits of Principal Leading Cadres of Party and Government Organs and Principal Leaders of State‑Owned Enterprises and Public Institutions within the CBIRC system, the China Banking and Insurance Regulatory Commission recently issued the Measures for Economic Accountability Audits of Principal Leading Cadres and Leaders in the System (hereinafter referred to as the “Measures”). These measures will effectively enhance the efficacy of audit oversight in advancing the comprehensive and rigorous governance of the Party within the CBIRC system, strengthening the supervision and management of the cadre workforce, and improving the standardization and effectiveness of financial regulatory work. They will also guide audited entities to further规范ize the exercise of power, elevate their organizational and management standards, and thereby better serve the real economy and prevent and defuse financial risks.

In light of the large number and diverse types of its dispatched agencies and affiliated units, the Party Committee of the China Banking and Insurance Regulatory Commission has attached great importance to building an economic accountability audit system. With a focus on strengthening the “Four Consciousnesses,” bolstering the “Four Confidences,” and upholding the “Two Safeguards,” it has rigorously implemented the principal responsibility for exercising full and rigorous Party self‑discipline, effectively reinforced the Party Committee’s unified leadership over economic accountability auditing, and closely aligned its efforts with the distinctive requirements of financial supervision in the new era. These measures have promoted the standardized development of economic accountability audits across the CBIRC system, strengthened, at the highest institutional level, the oversight of regulators themselves, and advanced the continued deepening and evolution of audit work.

The Measures comprise eight chapters and 55 articles, further clarifying the guiding principles of audit work, streamlining the organizational leadership mechanism, defining the scope of auditees, refining audit implementation requirements, accurately delineating responsibilities, and strengthening the application of audit findings. The Measures explicitly uphold and reinforce the Party’s centralized and unified leadership over audit work, emphasize the implementation of the new development philosophy, focus on economic accountability, ensure objective evaluation, and highlight identified issues. In alignment with the Central Audit Commission, they propose establishing and improving leading groups for economic responsibility auditing, enhancing oversight of such audits, and fostering effective mechanisms for consultation and coordination. The procedures for formulating annual plans are clearly defined, underscoring the seriousness and binding nature of audit planning. Audit implementation requirements have been refined, with explicit provisions for redress pathways available to auditees, thereby further standardizing and detailing audit procedures. Responsibilities are precisely defined, evaluations are conducted in a scientific and reasonable manner, and the requirements of the “three distinctions” are fully reflected, safeguarding the enthusiasm, initiative, and creativity of leading cadres in pursuing reform and development.

The Measures are closely aligned with the practical realities of financial regulatory work within the CBIRC system, clarifying the substance and boundaries of economic accountability, promoting the conscientious performance of regulatory duties, advancing the development of the respective institutions, and ensuring the effective management of public funds, state‑owned assets, and state‑owned resources while safeguarding against major economic and financial risks. In accordance with central directives and the specific circumstances of the CBIRC system, and in line with the relevant cadre‑management authorities, the scope of audit subjects is precisely defined for CBIRC bureaus, service‑oriented institutions under CBIRC oversight, and business‑oriented institutions under CBIRC oversight. Taking into account the differing nature of the entities subject to audit, audit priorities are differentiated: for CBIRC bureaus and service‑oriented institutions under CBIRC oversight, the focus is on the fulfillment of regulatory or industry‑service responsibilities and on efforts to prevent and resolve financial risks; for business‑oriented institutions under CBIRC oversight, the emphasis is on the establishment, improvement, and operation of corporate governance structures, as well as on the formulation and implementation of internal control systems. These measures comprehensively reflect the requirements that leading cadres uphold the law, observe discipline, comply with regulations, and fulfill their duties.

The Measures clarify the respective responsibilities of disciplinary inspection and supervision bodies, as well as departments such as organization and personnel, finance and accounting, and auditing, by designating them as member units of the leading group, thereby fostering coordinated oversight and establishing a comprehensive supervisory framework. The Measures stipulate that audit findings shall serve as a key basis for evaluating cadres, making appointments and removals, administering rewards and punishments, and assigning accountability; they also call for a thorough analysis of typical, widespread, and emerging issues identified in audit reports, with the aim of establishing a mechanism of coordinated collaboration—“joint consultation prior to auditing, collaborative efforts during auditing, and effective utilization of findings afterward.” Furthermore, the Measures require the Party committees of the audited entities to earnestly address the “second half” of the process, designate the principal responsible person of the unit as the primary accountable individual for rectification, and vigorously advance the implementation of corrective measures. Audit results and progress in rectification are to be incorporated into the assessment and inspection of the leadership teams’ performance under the responsibility system for building sound Party conduct and clean governance, as well as into the content of democratic life meetings, so as to continuously enhance the effectiveness of audit-based oversight and officely advance the deepening of comprehensive and strict Party self‑governance within the CBIRC system.

The China Banking and Insurance Regulatory Commission has issued the “Notice on Issues Related to Rate Adjustments for Long-term Medical Insurance Products.”

To further diversify the supply of health insurance products and meet the health protection needs of a broad range of consumers, the China Banking and Insurance Regulatory Commission recently issued the “Notice from the General Office of the China Banking and Insurance Regulatory Commission on Issues Related to Rate Adjustments for Long-term Medical Insurance Products” (hereinafter referred to as the “Notice”).

The Notice addresses systemic barriers that have long hindered the development of health insurance by introducing a premium‑adjustment mechanism, thereby sending a clear and positive signal in support of expanding long-term health insurance. This will help insurers offer products with longer coverage periods and more comprehensive benefits, better meeting consumers’ needs for sustained health protection.

The Notice primarily regulates the following matters:

First, the scope of long-term medical insurance products with adjustable premium rates has been clearly defined. In consideration of both scientific rigor and practical feasibility, this currently applies only to long-term medical insurance policies priced using natural premium rates, including those with policy terms exceeding one year, or those with policy terms of one year or less but containing guaranteed renewability provisions.

Second, the basic requirements for rate adjustments are clearly defined. Insurance companies shall establish procedures for rate adjustments, specifying the trigger conditions, internal decision-making mechanisms, and operational workflows. The first rate adjustment shall not occur earlier than three years after the product’s launch and sale, and the interval between successive rate adjustments shall be no less than one year. Insurance companies may not adopt differentiated rate‑adjustment policies based on individual insured persons’ health status.

Third, clarify the relevant content of product terms and product prospectuses. It is stipulated that insurance companies selling long-term medical insurance products with adjustable premiums shall provide policyholders with a product prospectus. The product terms and prospectus must provide detailed explanations of premium adjustment mechanisms, including specific trigger conditions, adjustment intervals, maximum allowable increases per adjustment, the adjustment process, and information disclosure requirements. Furthermore, the prospectus shall use illustrative examples to demonstrate the coverage provided by the product and the potential premium adjustments that policyholders may face in each year.

Fourth, the requirements for information disclosure regarding premium rate adjustments have been clarified. Insurance companies are required to disclose their premium rate adjustment policies and relevant product information on their corporate websites, and to publicly announce the details of such adjustments. For each premium rate adjustment, insurance companies must notify policyholders in the manner specified in the insurance application.

Fifth, standardize insurance companies’ sales practices and clarify regulatory measures for violations.

The issuance of the Notice will help further deepen supply-side structural reform in the life insurance sector, broaden the range of insurance products, and promote the sustained, healthy development of the health insurance market. At the same time, it will effectively address the risk of policy non-renewal arising from changes in the insured’s health status or the discontinuation of a product, thereby better safeguarding the legitimate rights and interests of insurance consumers.

The China Securities Regulatory Commission stated: It strongly condemns Luckin Coffee’s financial fraud.

The China Securities Regulatory Commission recently issued a statement expressing deep concern over the financial fraud scandal at Luckin Coffee Inc. and strongly condemning the company’s fraudulent practices. This marks an unusual regulatory stance by Chinese securities regulators toward U.S.-listed Chinese companies.

A relevant official from the China Securities Regulatory Commission stated that, regardless of where they are listed, listed companies must strictly comply with the laws and regulations of the respective markets and fulfill their information disclosure obligations in a truthful, accurate, and complete manner. The CSRC will, in accordance with the relevant arrangements for international securities regulatory cooperation, conduct investigations into the pertinent matters in accordance with the law, resolutely crack down on securities fraud, and effectively safeguard the rights and interests of investors.

On the evening of April 2, Beijing time (the morning of April 2, Eastern Time), Luckin Coffee, which is listed on the Nasdaq, issued an announcement stating that it had uncovered internal issues, including the fabrication of transaction data, with a total falsified amount reaching RMB 2.2 billion. Following the release of this news, Luckin Coffee’s pre-market share price plunged by 84%, and after the market opened, its stock triggered circuit breakers six times. Ultimately, the stock closed at $6.40, down 75.57% from the previous day, sparking panic among some Chinese‑listed‑stock investors and drawing overwhelming condemnation from the capital markets. Meanwhile, information regarding class-action lawsuits and compensation claims quickly began circulating among certain investors and law offices.

In the first quarter of 2020, the New Third Board market operated steadily, and the effects of reform gradually became apparent.

In the first quarter of 2020, the New Third Board market operated steadily. The total amount of equity financing and the value of M&A and restructuring transactions both increased quarter-on-quarter, the underlying institutional framework for trading improved, secondary-market trading became more convenient, and the effects of the comprehensive deepening of reforms on the New Third Board gradually became evident.

Targeted issuance reforms are beginning to yield results, and the scale of acquisitions by listed companies is rebounding.

The amount of capital raised through private placements has increased, with reforms boosting efficiency and reducing costs. First, the scope of financing has expanded: in the first quarter of this year, 105 ordinary share offerings raised RMB 5.659 billion, a 31.33% increase quarter-over-quarter. Second, financing efficiency has improved: 16 listed companies plan to issue shares to more than 35 new shareholders, raising a total of RMB 577 million, with an average of 54 new shareholders per offering. Third, overall financing costs have declined: according to statistics, 103 listed companies are currently conducting self‑initiated issuances, resulting in significantly shorter issuance timelines and lower issuance expenses.

The scale of acquisitions by listed companies has rebounded. In the first quarter of this year, listed companies completed 24 acquisition transactions totaling RMB 1.944 billion, a 185% increase from the previous quarter. Notably, listed companies have shown renewed enthusiasm for acquiring listed offices, with four deals amounting to RMB 955 million—up 1,479% quarter-on-quarter. These acquisitions accounted for 49.12% of all M&A activity among listed companies, an increase of 40.24 percentage points compared with the prior quarter. Meanwhile, listed companies executed three major asset restructuring transactions, with a combined value of RMB 624 million.

Enhanced trading convenience and improved secondary market performance

Reform of the trading system has enhanced trading convenience and improved the quality of secondary-market operations. First, increased trading frequency has bolstered market continuity. In the Innovation Tier, the average daily number of trade executions for stocks subject to call auctions rose from 1.9 in the two weeks prior to the implementation of the new rules on December 30, 2019, to 4.2 in the first quarter; in the Basic Tier, it increased from 1 to 1.7. Second, adjustments to the minimum order size and the introduction of features such as all‑day acceptance of block trades have further streamlined order submission and execution. On the platform’s launch day, March 30, 15.03% of orders were for fewer than 1,000 shares, with 8.76% for exactly 100 shares; a total of 99 block‑trade orders were received throughout the day, including 26 executed during regular trading hours, accounting for 26.26% of the day’s total. Third, market valuations have undergone a reasonable recovery. In the first quarter of 2020, various NEEQ indices showed a rebound, with the Market Maker Index rising 13.00% and the Innovation Composite Index gaining 11.51%. The uptick in share prices has driven a sustained increase in valuation levels: the 60‑day price‑earnings ratio for the Market Maker Index climbed from 20.30 at year‑end to 22.25, while that of the Innovation Composite Index advanced from 19.36 to 22.30.

In the first quarter, intraday trading volume rebounded. The average daily intraday turnover increased by 66.45% quarter-over-quarter, and the share of intraday turnover in total market turnover rose to 64.69%, up 23.21 percentage points from the previous quarter.

The Shanghai Stock Exchange has issued the Draft Measures for the Implementation of Share Reduction by Shareholders of STAR Market Listed Companies through Non‑Public Transfers and Allotments.

On the evening of the 3rd, the Shanghai Stock Exchange released the “Detailed Rules for the Reduction of Shares by Shareholders of Companies Listed on the STAR Market of the Shanghai Stock Exchange through Non‑Public Transfers and Allotments (Draft for Comments)” (hereinafter referred to as the “Detailed Rules”), and addressed reporters’ questions regarding the drafting background, guiding principles, and key institutional arrangements of the document.

The Shanghai Stock Exchange stated that the Detailed Rules provide specific provisions for private transfers and placements, serving as implementation guidelines and operational standards for shareholders of science and technology innovation companies to transfer pre-IPO shares through these methods.

With regard to the principal institutional functions of non‑public transfers, the Shanghai Stock Exchange stated that they primarily encompass three aspects: fostering a market‑based pricing constraint mechanism, meeting the exit needs of innovative capital, and attracting additional capital into share reduction activities.

According to reports, the Implementing Rules stipulate that shareholders may offer their pre-IPO shares for subscription to other existing shareholders of the science and technology innovation company. The other shareholders may, based on the price and quantity specified by the seller, independently decide whether to participate in the offering. The primary purpose of this offering is to safeguard the trading rights of existing shareholders and provide additional options for reducing their holdings of pre-IPO shares.

The Shanghai Stock Exchange emphasized that a key institutional objective of non‑public transfers is to further strengthen the market‑based pricing constraints on share reductions. The Implementation Rules explicitly stipulate that the transferee must be a professional institutional investor with appropriate pricing capabilities and risk‑bearing capacity.

The Shanghai Stock Exchange stated that the Implementation Rules design a price‑formation mechanism for non‑public transfers in line with market‑based principles. By ensuring adequate market‑driven organization, robust price competition, the establishment of a minimum transfer price, and careful consideration of trading efficiency, the Rules safeguard necessary transactional efficiency while preventing disruptions to the stable functioning of the secondary market.

It is worth noting that, in order to establish diversified capital exit channels and provide existing shareholders with the option to participate in the transfer of pre-IPO shares, the Implementing Rules, drawing on the share‑placement mechanism commonly used in the market, stipulate that shareholders may transfer their pre-IPO holdings to other shareholders of the company through a placement arrangement, thereby achieving the objective of reducing their shareholdings.

Commercial & Corporate

The Ministry of Commerce has issued a notice on further advancing reform and opening-up and ensuring stable foreign investment in response to the epidemic.

To earnestly implement the spirit of General Secretary Xi Jinping’s important speeches on coordinating epidemic prevention and control with economic and social development, fully carry out the decisions and arrangements of the CPC Central Committee and the State Council on stabilizing foreign investment, adhere to a combination of problem‑oriented and goal‑oriented approaches, pursue both expanding new investment and stabilizing existing stock, and ensure stable foreign investment through reform and opening up, while making every effort to safeguard the fundamentals of foreign trade and foreign investment, on April 1 the Ministry of Commerce issued the “Notice on Further Advancing Reform and Opening Up and Stabilizing Foreign Investment in Response to the Epidemic,” setting forth 24 specific measures and work requirements across five key areas to guide current and year‑long efforts to stabilize foreign investment.

First, we will provide full support to foreign-invested enterprises in restoring normal production and business operations. We will establish and improve mechanisms for responding to the epidemic, precisely address the challenges they face in resuming work and production, and facilitate the construction and implementation of major foreign-invested projects.

Second, we will advance higher‑level opening-up. We will implement the pre‑entry national treatment plus negative list regime, further broaden the scope of encouraged foreign investment, accelerate the development of pilot free trade zones and free trade ports, deepen pilot programs to open up the services sector, promote innovation and upgrading in national-level economic and technological development zones, and foster regionally coordinated opening-up.

Third, further advance the “delegation, regulation, and service” reform in the commercial sector. We will deepen the reform of the foreign investment management system, implement the Measures for the Reporting of Foreign Investment Information, improve the systems for ongoing and post‑event supervision, promote institutional and mechanism reforms in national-level economic development zones, and make effective use of special funds for foreign economic and trade development.

Fourth, we will strengthen services and promotion for foreign investment. We will innovate approaches to attracting investment, establish and improve an information platform for foreign-invested enterprises, elevate the quality of investment promotion efforts, fully leverage the role of trade fairs and exhibitions, and reinforce the development of multilateral and bilateral investment promotion mechanisms.

Fifth, continue to optimize the business environment for foreign investment. We will fully implement the Foreign Investment Law and its supporting regulations, strengthen the enforcement of policies aimed at stabilizing foreign investment, safeguard the legitimate rights and interests of foreign investors, and give full play to the role of investment promotion agencies and chambers of commerce as bridges and conduits.

The Notice requires commercial authorities at all levels to earnestly strengthen their sense of political responsibility and historical mission in ensuring stable foreign investment, maintain office confidence, unite in concerted efforts, assume due responsibilities, and, within the framework of reform and opening-up, carry out all measures to stabilize foreign investment in a solid and effective manner.

Two departments: Projects fostering deep integration between the express delivery sector and the manufacturing industry will receive financial support.

The State Post Bureau and the Ministry of Industry and Information Technology recently jointly issued the “Opinions on Promoting the Deep Integration of the Express Delivery Industry with the Manufacturing Sector” (hereinafter referred to as the “Opinions”). The Opinions propose supporting manufacturing enterprises and express delivery companies in integrating their resources, establishing joint ventures, leveraging their respective strengths, and developing supply-chain services tailored to the same manufacturing sectors.

The Opinions also propose supporting the inclusion of express delivery enterprises’ services for manufacturing projects within the scope of relevant special funds in the industrial and information technology sectors. Furthermore, they encourage localities to leverage existing funding channels to establish dedicated programs that promote the deep integration of the express delivery industry with the manufacturing sector.

The two ministries believe that manufacturing is the backbone of the national economy and serves as a crucial demand base for the development of the express delivery industry. Meanwhile, the express delivery sector is an integral part of the modern service industry, providing essential support to the growth of manufacturing. Promoting the deep integration and coordinated development of the express delivery industry with manufacturing is of great significance for building a strong manufacturing nation and a strong postal nation, and for achieving high-quality economic development.

To this end, the Opinions stipulate that by 2025, the express delivery industry will continue to expand its service scope for manufacturing, deeply integrating into sectors such as automotive, consumer goods, electronic information, and biopharmaceuticals. It will develop supply-chain capabilities covering procurement, production, sales, and after-sales processes across these industries, foster mature integrated models encompassing warehouse‑distribution integration, factory‑gate logistics, international supply chains, and overseas collaboration, and cultivate 100 exemplary projects of deep integration as well as 20 pilot zones for advanced integrated development. As a result, the express delivery sector’s capacity and level of service to related manufacturing industries will be significantly enhanced, while the supply-chain efficiency and market competitiveness of these industries will see marked improvements, achieving mutual benefit, synergistic growth, and coupled coexistence.

Shanghai has issued new regulations to support the development of electric vehicle charging infrastructure.

On April 2, the Shanghai Municipal Development and Reform Commission and four other departments jointly issued the Interim Measures of Shanghai Municipality on Promoting the Interconnected and Orderly Development of Electric Vehicle Charging (and Battery-Swapping) Facilities (hereinafter referred to as the “Measures”). The Measures stipulate that policies supporting intelligent, orderly charging will be upheld, and the construction of smart charging piles in residential areas will be encouraged. Existing charging piles in residential areas are also encouraged to undergo intelligent upgrades—such as the installation of energy routers—and will receive a government subsidy of RMB 200 per pile.

The Measures stipulate that, in supporting the development of demonstration residential communities for charging stations, priority will be given to establishing such communities in the central urban area (within the Outer Ring Road) and providing comprehensive policy support. With regard to subsidies for charging equipment, a subsidy will be granted at 50% of the equipment’s purchase price; the maximum subsidy is RMB 600 per kilowatt for DC charging facilities and RMB 300 per kilowatt for AC charging facilities.

Regarding policies supporting the charging of electric taxis, the Measures stipulate a solution that prioritizes sharing public charging infrastructure while supplementing it with dedicated taxi‑specific charging facilities. This approach aims to address nighttime charging needs, support the development of demonstration charging stations for taxis, and enable taxis to utilize the broader public charging network. Specific support measures include: providing a special per‑kilowatt‑hour subsidy of RMB 0.40 (as of 2020) to drivers; and backing the construction of demonstration stations. Between 2020 and 2022, the city plans to establish 15 taxi‑charging demonstration stations annually, adhering to defined construction standards. These stations will continue to receive a 30% equipment subsidy and also qualify for national reductions or exemptions on basic electricity charges for centralized charging and battery‑swap facilities. Additionally, the policy supports “vehicle‑charger matching” efforts, with a municipal‑level platform serving as an information hub to incentivize charging service providers and impose specific requirements on charging piles designated for taxi use.

China Securities Depository and Clearing Corporation has implemented a range of measures to continuously enhance its securities inquiry services.

To proactively implement the capital market’s policy of tax and fee reductions and further support epidemic prevention and control as well as economic and social development, China Securities Depository & Clearing Corporation has waived securities inquiry service fees for investors and adopted a series of measures to provide them with higher‑quality securities inquiry services.

Fees for all types of securities inquiry services have been waived, effectively reducing the cost burden on investors. Effective April 7, 2020, China Securities Depository & Clearing Corporation has implemented a free‑of‑charge policy for investors conducting various securities inquiry transactions, including inquiries related to Shanghai and Shenzhen market securities, National Equities Exchange and Quotation system securities, non‑overseas listed shares of overseas‑listed companies, and details of credit securities accounts, thereby substantially easing the administrative burden associated with such inquiries.

The electronic certificate feature has been successfully implemented, making securities‑related inquiries safer and more convenient. In line with the principle of “reducing in‑person visits by the public while increasing data‑driven processes,” and to meet investors’ needs for easy access to certificates and protection against data tampering, China Securities Depository & Clearing Corporation has rolled out the electronic certificate function for securities‑inquiry services conducted via self‑service terminals and online channels. Investors can now complete securities‑inquiry transactions without leaving home, enjoying a process that is simpler, more efficient, and more secure.

Investors can now access information on a wide range of securities across different markets through any service counter, achieving unified query services. To continuously enhance market‑service standards, China Securities Depository & Clearing Corporation has vigorously streamlined its counter‑based securities‑query offerings, enabling any counter to support investors in querying various types of securities—such as stocks, bonds, and mutual funds—as well as derivative contracts like stock options—across multiple markets. At the same time, CSDC has introduced self‑service inquiry terminals, ensuring seamless integration between manned counters and self‑service kiosks, thereby significantly improving the convenience of conducting securities‑query transactions.

China Securities Depository and Clearing Corporation stated that, as a key infrastructure of the capital market, it will continue to optimize its external services, closely monitor investors’ additional business needs, and steadily enhance the efficiency and quality of its investor services, thereby providing investors with even higher‑quality support.

The People’s Bank of China: In the first quarter, the issuance and net financing volume of corporate credit bonds increased significantly year on year.

On the 5th, the People’s Bank of China released data showing that in the first quarter of 2020, China’s bond market continued to develop steadily, providing strong support for epidemic prevention and control as well as economic and social development. According to preliminary statistics, bond issuance totaled RMB 12 trillion in the first quarter, up 14% year on year; outstanding bonds stood at RMB 103 trillion, an increase of 4% from the end of last year, with the market size ranking second globally.

Among these, the issuance and net financing of corporate credit bonds increased significantly year on year, and bond financing for private enterprises continued to improve. In the first quarter of 2020, corporate credit bonds totaled RMB 3 trillion in issuance, up 35% year on year; net financing exceeded RMB 1.7 trillion, an increase of more than RMB 800 billion compared with the same period last year; both issuance volume and net financing remained at historically high levels for this time of year. Meanwhile, private enterprises issued approximately RMB 210 billion in bonds in the first quarter, a 50% year-on-year rise; their net financing reached about RMB 93 billion, marking a three-year high.

In addition, on the front of opening-up, during the first quarter, the interbank bond market welcomed 26 new overseas legal entities, with net purchases by foreign investors totaling RMB 59.7 billion. As of the end of March, a total of 822 overseas institutional investors had entered the interbank bond market, holding bonds worth RMB 2.26 trillion.

Taxation TAXATATION

Ministry of Finance: Enhancing Credit Support for Financing to Small and Micro Enterprises and Agricultural, Rural, and Farmer Entities

To fully leverage the role of government-backed financing guarantees, more proactively support small and micro enterprises and agricultural, rural, and farmer entities in obtaining credit enhancement, and help businesses resume work and production and overcome difficulties, the Ministry of Finance recently issued the “Notice on Fully Leveraging the Role of Government‑Backed Financing Guarantees to Enhance Credit for Small and Micro Enterprises and Agricultural, Rural, and Farmer Entities” (hereinafter referred to as the “Notice”).

The Notice clarifies that the National Financing Guarantee Fund is to accelerate its equity investments, aiming to invest in 10 city‑level government‑backed financing guarantee institutions by 2020 that have demonstrated significant results in supporting small and micro enterprises and agriculture. It also calls for the Fund to collaborate with banking and financial institutions on bulk guaranteed loan programs, with the goal of achieving an additional reinsurance business volume of RMB 400 billion in 2020. The National Financing Guarantee Fund will waive reinsurance fees for single‑borrower guarantees of RMB 1 million or less, and will reduce reinsurance fees by 50% for guarantees exceeding RMB 1 million throughout 2020. Local government‑backed financing and reinsurance institutions are required to halve their financing guarantee and reinsurance fees for small and micro enterprises for the entire year of 2020, striving to bring the overall financing guarantee rate for such entities below 1%. Furthermore, the proportion of business supporting small and micro enterprises and agriculture will be increased, ensuring that by 2020, at least 80% of newly added financing guarantee amounts and numbers are directed toward small and micro enterprises and “agriculture, rural areas, and farmers,” with at least 50% of these new guarantees being for individual borrowers with amounts of RMB 5 million or less.

The Notice requires that fiscal departments at all local levels, in coordination with relevant parties, adjust the profit‑oriented performance assessment criteria for government‑backed financing guarantee and re‑guarantee institutions. The assessment should place particular emphasis on the effectiveness of supporting agriculture and small businesses—measured by indicators such as the number of new small‑business and agricultural‑supporting guarantee clients added during the year, the total amount of new guarantees provided to such clients, the share of new guarantees below RMB 5 million, and the average comprehensive financing rate for the year—while ensuring compliance with due‑diligence exemption provisions. In addition, a mechanism should be established to link performance‑evaluation outcomes directly to capital replenishment, risk compensation, and remuneration packages, thereby creating an incentive‑and‑constraint framework. For institutions that demonstrate significant results in supporting small businesses and agriculture but face substantial indemnity pressures, local fiscal departments are required to provide timely and appropriate support based on performance‑assessment findings, so as to promote sustainable operations.

The resumption rate of industrial enterprises above designated size in Wuhan stands at 97.2%.

At a press conference held on the 5th, Hu Yabo, a member of the Standing Committee of the Wuhan Municipal Party Committee and Executive Vice Mayor of Wuhan, stated that, overall, the city’s efforts to resume work and production have progressed faster than anticipated and exceeded expectations.

According to reports, as of April 4, a total of 10,897 “four‑above” enterprises and real estate developers in Wuhan had resumed operations, representing a resumption rate of 93.6%. Specifically, the resumption rates were 97.2% for industrial enterprises above designated size, 93.2% for service‑sector enterprises above designated size, 95.8% for wholesale, retail, accommodation, and catering enterprises above designated size, 84.7% for construction offices with relevant qualifications, and 92.4% for real estate development and operation enterprises.

Wuhan has formulated detailed plans for the resumption of work and production across various industries, establishing a flexible and efficient approval system, a rigorous and well-organized prevention-and-control mechanism, as well as an effective service framework, a practical guidance mechanism, and a dynamic, adaptable labor‑management system. At present, all market entities not on the restricted‑list are permitted to resume operations.

Focusing on coordinated resumption of work and production across industrial chains, Wuhan has encouraged leading enterprises to resume operations while working collaboratively to address key challenges—such as workforce mobility, logistics, and financing—faced by offices throughout the supply chain. To ensure timely spring farming and preparation, the city has increased the level of mechanized operations and secured the agricultural inputs urgently needed for spring planting. Meanwhile, to bolster long-term development momentum, Wuhan is concentrating on priority industries and new‑infrastructure sectors—including 5G, urban power grids, and rail transit—while accelerating the resumption of major projects valued at over RMB 100 million.

Hu Yabo stated that Wuhan has implemented three measures to effectively address the challenges faced by leading enterprises and the coordinated resumption of operations across industrial chains: first, it has compiled two separate lists—identifying key leading enterprises in Wuhan’s priority industrial chains and their core supporting offices; second, it provides tailored, one‑on‑one services to help companies streamline their upstream and downstream supply chains; and third, it has established a comprehensive coordination mechanism, with departments including the Development and Reform Commission, the Department of Economy and Information Technology, finance, taxation, transportation, and electricity working together to deliver a coordinated package of support.

Wuhan has bolstered its policy support, delivering a much-needed boost. Hu Yabo stated that, on the one hand, building on the full implementation of various business‑friendly policies issued by the central government and Hubei Province, Wuhan has introduced 21 measures to foster the development of small and medium‑sized enterprises, 15 financial‑support initiatives to help businesses weather the pandemic, and seven measures to stabilize employment and safeguard enterprise operations through social insurance. On the other hand, the city is seizing the window of opportunity presented by the 14th Five-Year Plan, accelerating research and proposing key projects and policy priorities to seek approval from national ministries and commissions. At the same time, it is encouraging cadres to work directly at the grassroots level, proactively providing on‑site services, ensuring effective policy support, and helping enterprises resolve their challenges.

Hu Yabo stated that measures that should be suspended will remain suspended, and those that should be postponed will be resolutely delayed. During the pandemic, none of the 224 enterprises that maintained continuous production in Wuhan, nor any of the companies that recently resumed work and production, reported a single cluster‑type cross‑infection.

You may waive a personal income tax refund; unpaid personal income tax will incur late payment penalties.

The first-ever annual individual income tax settlement in the history of China’s personal income tax system has begun. On April 1, the State Taxation Administration issued the 2019 Annual Individual Income Tax Comprehensive Income Settlement Tax Filing Guidelines, clarifying that taxpayers may opt out of claiming refunds, but must file to pay any additional taxes owed; failure to do so will result in the imposition of late-payment penalties.

When should the annual tax settlement be filed?

The State Taxation Administration has stated that taxpayers must file their annual individual income tax settlement between March 1 and June 30 of the year following the year in which they earned their comprehensive income. In other words, the annual settlement for 2019 income must be completed between March 1 and June 30, 2020.

If you require your employer to handle the 2019 annual individual income tax settlement on your behalf, you must provide written conofficeation to your employer by April 30, 2020. If no such conofficeation is received by that deadline, you will be required to complete the annual tax settlement yourself by June 30, 2020.

If your total annual income for 2019 was RMB 60,000 or less but you had taxes withheld in advance, you can file a simplified tax refund application online between March 1 and May 31. At that time, you simply need to enter or conoffice your prepaid tax amount and your bank account information to quickly apply for a refund.

What are the consequences of failing to file your annual tax settlement on time?

If you are eligible for a tax refund, filing an annual tax reconciliation to claim it is your right, and you bear no liability. In other words, you may choose to waive the refund. If you opt to forgo the refund, you are not required to file an annual tax reconciliation.

If you are required to pay additional tax, filing an annual tax reconciliation is your obligation. If a taxpayer is required to pay additional tax (except in cases where the law provides for exemption from reconciliation) but fails to file the annual reconciliation of comprehensive income as prescribed, they may be subject to administrative tax penalties and have such non‑compliance recorded in their personal tax credit file.

According to Article 62 of the Law on the Administration of Tax Collection, if a taxpayer fails to file a tax return or submit the required tax-related materials within the prescribed time limit, the tax authority shall order the taxpayer to make corrections within a specified period and may impose a fine of no more than RMB 2,000. In cases of serious violations, a fine of more than RMB 2,000 but not exceeding RMB 10,000 may be imposed, together with the recovery of the unpaid taxes and the imposition of late payment penalties. The late payment penalty is calculated at a rate of 0.05% per day, starting from the date the payment deadline has passed. In other words, following the annual tax reconciliation filing, if you are required to pay additional taxes, you must remit the outstanding amount by June 30, 2020; otherwise, you will incur a daily late payment penalty of 0.05%.

How do I file my annual tax reconciliation return?

There are three main ways to file your annual tax settlement: do it yourself, have your employer handle it, or hire a professional.

First, taxpayers may file their returns themselves. They can complete the annual tax reconciliation through channels such as the Individual Income Tax Mobile App or the Natural Person Online Tax Service Platform.

Second, you can have your employer handle it—simply ask your current employer to process your annual tax settlement. You may either request your employer to act as an agent for this procedure, or inquire with them about how to file yourself using a mobile app or the Individual Online Tax Service platform.

Third, you may entrust others to handle the matter, that is, delegate it to a tax‑related professional service agency or to other entities or individuals. If you choose this option, you must sign a power of attorney with the entrusted party.

In the first two months, nationwide tax and fee reductions totaled 402.7 billion yuan, and there is still room to further strengthen proactive fiscal policy.

On March 31, the State Council Information Office held a press conference. Wang Daoshu, Chief Auditor of the State Taxation Administration, stated that since the onset of the COVID‑19 pandemic, the tax authorities have implemented concrete, decisive measures to ensure the full and effective implementation of all tax and fee preferential policies. In the first two months of this year, nationwide tax and fee reductions totaled RMB 402.7 billion. With the arrival of the major quarterly filing period in April, the scale of enterprises benefiting from these tax and fee cuts is expected to expand further.

Chen Hanlin, Tax Services Managing Partner for EY Greater China, stated that China’s tax and fee reduction measures have yielded significant results, demonstrating the government’s unwavering commitment to fulfilling its promises to businesses and society. Most importantly, these initiatives have helped restore confidence in the domestic market.

According to Wang Daoshu, the figure of 402.7 billion yuan comprises two components: first, 158.9 billion yuan in additional tax and fee reductions resulting from the new policies introduced in 2020 to support epidemic prevention and control as well as economic and social development; second, 243.8 billion yuan in tax and fee reductions realized through the continued implementation in 2020 of the larger-scale tax and fee cuts enacted in 2019. This includes 136.5 billion yuan in additional tax reductions stemming from the carryover effects of the VAT reform, 84.8 billion yuan in additional fee reductions due to lower declaration rates, 2.8 billion yuan in reduced levies on cultural undertakings and the National Major Water Conservancy Project Construction Fund, and 19.7 billion yuan in further tax and fee reductions under other ongoing policies, such as universal tax relief for small and micro enterprises and special additional deductions for individual income tax.

On February 6 this year, the Ministry of Finance and the State Taxation Administration issued a notice clarifying that manufacturers of key materials for epidemic prevention and control may, on a monthly basis, apply to their competent tax authorities for a full refund of the incremental input VAT credit. As a manufacturer holding a production license for hydrogen‑inhalation medical devices, Shanghai Pumei Medical Technology Co., Ltd. is one of the enterprises eligible under this policy. “The company has already received a VAT credit refund totaling RMB 1.5 million. This refund has bolstered our working capital, enabling us to expand our workforce and fully ensure the production of essential supplies,” said Gui Yangming, the company’s chief financial officer.

According to reports, in 2019 the carryforward VAT refund policy was extended to all industries, and Shanghai Pimei Medical Technology Co., Ltd. had already benefited from a carryforward VAT refund of nearly RMB 700,000. During this year’s pandemic, the Jiading District Tax Service Bureau of Shanghai established a green‑channel approval process for key enterprises producing essential supplies, completing the review and approval of a RMB 1.5 million carryforward VAT refund application submitted by Shanghai Pimei Medical Technology Co., Ltd. through the electronic tax bureau in just one working day.

“Since some enterprises—particularly small and medium-sized service offices—generated very little revenue during the pandemic, the relief provided by tax and fee reductions will be more effective only when combined with a range of more direct measures, such as fiscal subsidies and loans,” said Chen Hanlin.

Wang Daoshu also stated that, recently, the state has raised the export tax rebate rates for 1,464 products. With the exception of “high‑energy‑consumption, high‑pollution, and resource‑intensive” goods, the rebate rate for all other exported products has been aligned with the applicable tax rate, effectively achieving a zero‑rate treatment for exports. This increase in export tax rebate rates helps reduce business operating costs, enhance the international competitiveness of exported goods, and, at this juncture, significantly bolster the confidence of exporting enterprises.

According to data from the State Taxation Administration, as of March 30, since the implementation of these facilitation measures on February 10, tax authorities nationwide have processed export tax refunds totaling RMB 204 billion for nearly 230,000 exporting enterprises, thereby effectively easing their financial pressures.

“At present, the resumption of work and production across regions and industries is progressing in an orderly manner. However, due to the impact of the pandemic, the pace of resuming operations varies along the industrial chain, with some segments moving faster than others. Therefore, it is particularly important to facilitate supply-chain linkages, unblock bottlenecks, and promote coordinated resumption between upstream and downstream sectors,” said Cai Zili, Director-General of the Revenue Planning and Accounting Department of the State Taxation Administration, at the meeting. He added that tax authorities are further tapping the potential of tax‑related big data to provide targeted support for enterprises’ resumption of work and production at the micro level. As of March 30, tax authorities nationwide had matched more than 2,600 enterprises facing raw-material shortages with 45,000 suppliers, delivering tangible assistance to a broad range of businesses.

China’s first first-loan service center has begun operations in Beijing, with 22 banks already on board.

On April 1, Beijing’s First‑Loan Service Center—the nation’s first of its kind—began formal operations at the Beijing Municipal Government Service Center in Liuliqiao. The center currently hosts 22 banks and six financing‑guarantee and micro‑loan institutions, and it shares relevant data with departments such as real estate registration, taxation, and civil affairs registration, enabling it to provide businesses with one‑stop, tailored, and expedited first‑loan processing services.

A relevant official from the Beijing Municipal Bureau of Government Services stated that the establishment of the First-Loan Center is aimed at addressing the challenge faced by small and micro enterprises with no prior credit history in obtaining their first loan, and it holds significant importance for further enhancing financing accessibility for these businesses, optimizing the capital’s business environment, and deepening structural reforms on the financial supply side.

A clear overview of financial products from 22 banks

The First-Loan Service Center is located on the fourth floor, Island C, of the Municipal Government Service Center, with a total of nine integrated service windows. This morning, Manager Wang from a consulting office in Chaoyang District visited the bank’s loan‑consultation window for advice. He said that in the past, companies would spend an entire month just visiting different banks to learn about their products. After simply stating his needs at the window, the staff promptly presented several suitable financial offerings, and he plans to follow up with the Beijing Branch of Bohai Bank.

According to a responsible official from the Beijing Municipal Bureau of Government Services, at the First-Loan Service Center, information on 67 financial products offered by 22 participating banks—including China Agricultural Development Bank and China Construction Bank—along with details such as pricing, is presented in a unified manner to businesses seeking financing. The Center’s information system supports search and query functions based on criteria such as enterprise type, years in operation, loan amount, collateral type, and loan term, enabling companies to quickly identify suitable products and banks that align with their specific circumstances and financing needs, thereby enhancing the precision of services.

According to reports, the 22 banks that have already established a presence at the First-Loan Center span large, medium, and small institutions, including six state-owned banks—ICBC, Agricultural Bank of China, Bank of China, China Construction Bank, and Postal Savings Bank of China—ten joint-stock banks, two key local corporate banks, and four Beijing branches of out-of-town city commercial banks, enabling them to offer enterprises differentiated and specialized financial services.

A relevant official from the Beijing Municipal Bureau of Government Services stated that businesses can here “compare offerings from multiple providers,” engage directly with banks, streamline financing procedures, and enhance transaction transparency. At the same time, this approach encourages participating banks to continuously improve their services by offering higher quality at lower costs, thereby reducing enterprises’ financing expenses.

According to a responsible official from the Beijing Banking and Insurance Regulatory Bureau, at the First-Loan Center, once a company submits a loan application, banks are required to decide within 24 to 48 hours whether to accept it. Following acceptance, each bank must establish a green channel to process corporate credit requests in an expedited manner.

One-stop access to real estate registration, tax, and marriage registration information.

According to a responsible official from the Beijing Municipal Bureau of Government Services, the Beijing First-Loan Service Center was jointly established by the Bureau, together with the Beijing Banking and Insurance Regulatory Commission, the Municipal Local Financial Regulatory Bureau, and the People’s Bank of China’s Operations Management Department. The center brings together at the municipal level the government departments responsible for approvals, consolidates businesses seeking services, and centralizes information on approval outcomes. While handling government matters such as business registration and tax affairs, enterprises can also seek advice on and apply for financing.

Meanwhile, in addition to the 22 banks, the First-Loan Service Center has also brought on board six financing guarantee institutions and micro‑loan providers that are involved in corporate loan processing, thereby facilitating on-site access to ancillary services and a diversified range of financing channels tailored to businesses’ banking needs.

According to reports, the First‑Loan Service Center has established data‑sharing channels and operational mechanisms for the lawful and efficient acquisition of information required for loan processing, enabling seamless access to relevant data from real estate registration, tax authorities, civil affairs bureaus, and other agencies, thereby enhancing the efficiency of loan‑approval procedures. Meanwhile, the Municipal Real Estate Registration Center has also relocated to the First‑Loan Service Center, offering businesses on‑site, one‑stop access to information and a dedicated green channel for handling property‑mortgage transactions, further boosting financing efficiency.

A relevant official from the Beijing Municipal Bureau of Government Services stated that, in the next phase, the Bureau and the Beijing Banking and Insurance Regulatory Commission will rigorously implement all epidemic prevention and control measures to prevent crowds from gathering. While ensuring the smooth operation and full utilization of the First-Loan Service Center, they will, based on the actual needs of businesses and participating banks, gradually expand its functionalities, standardize service procedures, and enhance service efficiency, thereby fostering a healthy competitive environment and providing enterprises with higher‑quality, more convenient loan services.

LITIGATION & ARBITRATION

Premier Li Keqiang signed a State Council Order promulgating the “Decision of the State Council on Amending and Repealing Certain Administrative Regulations.”

According to a report by China National Radio’s “News and Newspaper Digest,” Premier Li Keqiang recently signed a State Council decree promulgating the “Decision of the State Council on Amending and Repealing Certain Administrative Regulations” (hereinafter referred to as the “Decision”), which shall take effect from the date of its publication.

In order to advance, in accordance with the law, the reforms of streamlining administration and delegating power, combining deregulation with effective oversight, and optimizing public services, the State Council has reviewed administrative regulations pertaining to items whose administrative licenses have been abolished or delegated, as well as those that are no longer applicable in practice. Accordingly, it has decided to amend certain provisions of seven administrative regulations and to repeal ten administrative regulations.

With regard to the abolition of administrative licensing requirements, three administrative regulations, including the Implementing Rules of the Fisheries Law, have been amended to eliminate the following licensing requirements: authorization for the construction of artificial reefs outside the boundaries of no‑fishing zones for motorized bottom trawl vessels; qualification accreditation for personnel engaged in weather modification operations; approval for the transfer of operational equipment among weather‑modification entities; approval for clinical trials of new veterinary drugs; and approval for the import of veterinary biological products that have already obtained an import registration certificate. In addition, relevant regulatory measures and provisions on legal liability have been revised and improved.

With regard to streamlining the approval process, the Regulations on Nurses have been amended to shift the authority for nurse registration from unified review by provincial-level health authorities to the health authorities responsible for approving or filing the establishment of the medical institutions where nurses practice.

With regard to optimizing the business environment, the Regulations on Seafarers have been amended to abolish the licensing requirement for issuing seafarer service books. At the same time, in order to enhance service efficiency and facilitate administrative procedures for seafarers, relevant provisions have been revised. The Regulations on the Development and Management of Urban Real Estate have also been amended to further streamline the documentation required. Additionally, the Regulations on Urban Water Supply have been revised to better balance the roles of government and market, reducing administrative intervention in matters that can be effectively managed through market mechanisms.

With regard to strengthening follow-up supervision, in accordance with the requirements of the “delegation, regulation, and service” reform, relevant authorities will enhance oversight of activities conducted after the revocation of administrative licensing. For example, following the abolition of the approval requirement for the transfer of weather‑modification equipment among operating entities, the Regulations on Weather Modification have introduced a “filing”‑based regulatory measure.

The 10 administrative regulations, including the Regulations on Soil and Water Conservation in the Border Area of Shanxi, Shaanxi, and Inner Mongolia and the Implementing Regulations of the Administrative Supervision Law of the People’s Republic of China, are hereby repealed. Among these, some were enacted long ago, pertained to temporary tasks, have become inapplicable in practice, or conflict with relevant laws and regulations; others have been repealed by higher-level laws, or their underlying legal bases have been invalidated; and still others have been superseded by other statutory provisions.

The Supreme People’s Court has issued a document to advance the modernization of the judicial system and judicial capacity.

Recently, the Supreme People’s Court issued the “Opinions on Implementing the Spirit of the Fourth Plenary Session of the 19th CPC Central Committee and Promoting the Modernization of the Trial System and Trial Capabilities,” setting forth clear requirements regarding upholding the Party’s absolute leadership over judicial work, enhancing the capacity to serve the overall national interest, deepening comprehensive and coordinated reforms of the judicial system, advancing the development of smart courts, and steadfastly upholding strict Party self‑governance in all respects.

The Opinions emphasize the need to officely uphold the Party’s absolute leadership over judicial work and unswervingly follow the path of socialist rule of law with Chinese characteristics. They call for treating “remaining true to our original aspiration and keeping our mission officely in mind” as a perennial task in strengthening the Party building within the people’s courts and a lifelong commitment for all officers and staff. The Opinions further require strict implementation of institutional mechanisms that resolutely safeguard the authority of the CPC Central Committee and its centralized, unified leadership, as well as those ensuring the Party’s overall leadership, so as to ensure that Party leadership is effectively integrated into every field, aspect, and stage of the people’s courts’ work. Moreover, it is essential to uphold the people’s position as masters of the country, steadfastly adhere to the system of people’s congresses, consciously accept oversight by the people’s congresses, democratic oversight, and oversight from all sectors, implement the Law on People’s Assessors, and ensure the orderly participation of the public in the administration of justice, thereby promoting judicial fairness.

The Opinions emphasize the need to strengthen the people’s courts’ capacity to serve the overall national interest and to proactively support and safeguard economic and social development. They call for robust judicial services and safeguards in support of major national priorities and strategies, including resolutely winning the three critical battles, optimizing a law-based business environment, advancing the “delegation, regulation, and service” reform, and reinforcing property rights protection. It is essential to uphold the guiding position of Marxism in the ideological sphere and to improve the mechanisms that ensure the deep integration of core socialist values into adjudication and enforcement work. Above all, the safety and health of the people must remain the top priority; accordingly, systems and mechanisms for law-based prevention and governance should be refined, and the people’s courts’ ability to provide effective services and guarantees in responding to major emergencies must be enhanced.

The Opinions call for deepening the comprehensive and coordinated reform of the judicial system and advancing the improvement of a socialist judicial system that is fair, efficient, and authoritative. They emphasize refining mechanisms for supervising and restraining judicial power, strengthening safeguards for law-based performance of duties, rigorously enforcing the accountability system for unlawful adjudication, and fully implementing the judicial responsibility system. It is essential to pursue the deep integration of judicial work with modern technology, elevating the development and application of smart courts and enhancing capabilities in intelligent adjudication, enforcement, service delivery, and management. Furthermore, it is imperative to uphold strict Party self‑governance, strict court governance, and stringent administrative oversight; to improve integrity‑risk prevention and control mechanisms aligned with the judicial responsibility system; and to reinforce deterrence against corruption, refine institutional safeguards against corruption, and foster a conscious commitment to resisting corruption.

The “Opinions” explicitly require courts at all levels to adopt a pragmatic and fact‑based approach and implement concrete, well‑grounded measures to ensure that all tasks and initiatives are effectively put into practice and yield tangible results. It is essential to strengthen organizational leadership, clarify the division of responsibilities, focus on key priorities, closely monitor outcomes, and thoroughly implement the Opinions on Comprehensively Deepening Reform in the Political and Legal Fields as well as the “Five‑Year Reform Outline,” thereby advancing the modernization of the trial system and judicial competence and, by leveraging judicial functions, promoting the modernization of the national governance system and governance capacity.

The Ministry of Public Security has introduced ten measures to crack down, in accordance with the law, on crimes in the areas of food, drugs, the environment, and intellectual property.

To make every effort to contain the COVID‑19 pandemic and ensure the resumption of work and production during the epidemic, the Ministry of Public Security recently introduced ten measures for public security organs to crack down, in accordance with the law, on crimes in the areas of food, drugs, the environment, and intellectual property, thereby supporting the resumption of work and production under epidemic prevention and control.

I. Severely crack down, in accordance with the law, on crimes involving the production and sale of counterfeit and substandard agricultural inputs. Focusing on spring‑plowing supplies such as seeds, pesticides, and fertilizers, we will prioritize combating illegal practices including trademark‑piracy manufacturing, infringement and counterfeiting, unauthorized adulteration, and the misrepresentation of substandard products as compliant ones, thereby purifying the agricultural input market and ensuring smooth spring‑field operations.

II. Severely crack down, in accordance with the law, on crimes that endanger food safety. Priority will be given to prosecuting offenses such as manufacturing and selling toxic or harmful foods and health supplements by illegally adding pharmaceuticals to food under the guise of epidemic prevention and control; trading in meat from diseased or dead animals and expired food; producing and marketing substandard tableware and packaging materials; and other criminal activities that jeopardize food safety on school campuses, thereby ensuring the safety of meals during the resumption of work, production, and classes.

III. Severely crack down on crimes in the pharmaceutical sector in accordance with the law. Focus on combating criminal activities involving the production and sale of counterfeit or substandard COVID‑19 vaccines, anti‑epidemic drugs, viral testing reagents, as well as protective supplies such as masks, disinfectants, and protective clothing, and medical devices, thereby ensuring the safety of medicines and medical products for the public.

IV. Severely crack down, in accordance with the law, on crimes involving the manufacture and sale of substandard and counterfeit products in the construction sector. Priority will be given to combating offenses such as the production and sale of substandard building materials, construction machinery, and fire‑fighting equipment, as well as illegal sand mining, thereby ensuring the safety of enterprises resuming work and production.

V. Severely crack down, in accordance with the law, on copyright infringement and piracy crimes in the film and television as well as online training sectors. In response to the significant impact of the pandemic on the film and television industry and to emerging developments in the online training sector, we will coordinate with relevant authorities to launch targeted enforcement campaigns, strengthen copyright protection, and foster the healthy and prosperous development of these industries.

VI. Severely crack down on wildlife-related crimes in accordance with the law. In coordination with relevant departments, we will launch targeted enforcement campaigns to rigorously combat illegal hunting and killing of precious and endangered wild animals, as well as the unlawful acquisition, transportation, and sale of such animals and their products, and illegal hunting activities, thereby making every effort to prevent and control public health risks.

VII. Establish a rapid investigation mechanism for enterprise-related cases. Strengthen police–enterprise cooperation and police–public coordination, set up a green channel, and ensure swift acceptance of reports, prompt investigation and case resolution, and efficient recovery of stolen assets and mitigation of losses in crimes involving enterprises.

VIII. Conduct a comprehensive review and resolution of long-pending cases involving enterprises. Thoroughly address criminal cases in the areas of food, drug, environmental, and intellectual property law that impede the production and operations of businesses, particularly those facing difficulties. Employ measures such as public oversight with designated case‑by‑case supervision, elevation of investigative jurisdiction, and inter‑regional cooperation to expedite proceedings, enhance the quality of case handling, and safeguard the legitimate rights and interests of rights‑holding enterprises.

9. Further improve and standardize law enforcement and case-handling practices. In handling criminal cases involving enterprises, where the suspect voluntarily pleads guilty, sincerely repents, obtains the victim’s forgiveness, and poses little social harm, exercise caution in applying coercive measures that restrict personal liberty. Where seizure, impoundment, or freezing is genuinely necessary, generally leave sufficient working capital and maintain access to current accounts.

X. Actively provide legal services. Strengthen cooperation with the media, make full use of public security’s new‑media platforms, intensify public legal education and case‑based legal explanations, enhance the rule‑of‑law awareness and safety‑prevention consciousness of employees at enterprises resuming work and production, and improve their ability to defend against unlawful infringements.

A fan was found to have infringed upon rights after posting inappropriate remarks on the “DongqiuDi” app.

Believing that fan Mr. Wang had made malicious defamatory and abusive remarks about the “DongqiuDi” app, Beijing Duoge Technology Co., Ltd. brought a lawsuit against Mr. Wang on the grounds of infringement of his right to reputation, seeking an apology, removal of the adverse effects, restoration of his reputation, and compensation for reasonable expenses and economic losses totaling RMB 15,000. Recently, the Haidian District People’s Court of Beijing concluded the case, ruling in favor of the plaintiff’s claims.

The plaintiff, Beijing Duoge Technology Co., Ltd., alleges that the “DongqiuDi” mobile application is operated by the plaintiff and enjoys considerable influence and a top ranking among football‑related mobile apps in China. The defendant, Mr. Wang, repeatedly published false statements on his Sina Weibo account over an extended period, maliciously defaming and insulting the plaintiff’s “DongqiuDi” app, thereby infringing upon the plaintiff’s right to reputation. Such conduct has led to significant misunderstandings among a broad user base regarding the plaintiff and its “DongqiuDi” app, resulting in a severe decline in the plaintiff’s social standing and causing extremely adverse repercussions within the industry. The plaintiff requests that the court order the defendant, Mr. Wang, to issue a public apology, mitigate the adverse effects, restore the plaintiff’s reputation, and compensate for reasonable expenses and economic losses.

Defendant Mr. Wang argued that he does not agree with the plaintiff’s claims. While acknowledging that he did make the relevant statements, Mr. Wang contended that, as a football fan, he could not tolerate the company’s dissemination of false information intended to deceive Chinese fans; therefore, he maintained that he acted without subjective fault and was merely exercising his right to criticize and oversee matters of public concern. Moreover, the Weibo posts in question received only a small number of comments, likes, and shares, thus failing to cause any significant impact, and have since been deleted. In addition, Mr. Wang asserted that “DongqiuDi” is a mobile application, lacks legal person status, and therefore does not possess personality rights.

After hearing the case, the court held that legal persons enjoy the right to reputation. The right to reputation of a legal person constitutes the collective social assessment of its credibility, external image, distinctive business characteristics, product quality, service attitude, and other aspects. The content of this right is primarily centered on the entity’s business image and is directly linked to its economic activities and the outcomes of its production and operations. It is a social image shaped through the legal person’s proactive efforts in the course of its business, as well as a comprehensive social evaluation encompassing factors such as its production and operational capabilities, level of productivity, financial standing, product reputation, and commercial creditworthiness. The right to reputation of a legal person is closely tied to its property interests. This right is protected by law, and any act of insulting or defaming a legal person is prohibited.

First, the plaintiff enjoys the right of reputation with respect to the statements made by Mr. Wang regarding the “DongqiuDi” app. As the operator of the “DongqiuDi” app, the plaintiff’s evaluation of its own product directly affects the company’s commercial interests, including production and operations. In other words, Mr. Wang’s public assessment of “DongqiuDi” may have an impact on the plaintiff’s company; therefore, the plaintiff is entitled to assert the relevant rights.

Secondly, Mr. Wang’s statements have already constituted an infringement of the right to reputation. According to the facts established in this case, Mr. Wang repeatedly and persistently employed vulgar, abusive terms such as “Dong Shi Di” and “Dong Ge Shi,” which go beyond the bounds of restraint and tolerance that the plaintiff should reasonably be expected to endure, thereby amounting to a reputational infringement. Accordingly, Mr. Wang must bear the corresponding liability for tort. As for Mr. Wang’s defense—that his remarks were made in his capacity as a fan, intended to oversee the news content provided by the “Dong Qiu Di” app—the court holds that while legitimate freedom of speech is protected by law, such freedom must nonetheless remain grounded in reason, objectivity, and respect for the lawful rights and interests of all relevant parties, including the right to reputation. By employing abusive language in his comments, Mr. Wang has clearly exceeded the scope of so‑called oversight, and his defense is therefore difficult to accept.

Finally, Mr. Wang’s comments did indeed have a certain impact on the plaintiff, leading to a decline in the plaintiff’s social reputation and harming the plaintiff’s business opportunities and commercial interests. Taking into account the substantial number of followers on Mr. Wang’s Weibo account, as well as the nature and circumstances of his infringing conduct, the court ultimately ruled that Mr. Wang must issue a public apology and compensate the plaintiff for reasonable expenses and economic losses, totaling RMB 15,000.

Second-instance verdict delivered in the case of dereliction of duty involving public officials related to the “sports field body‑burial case”

According to an official WeChat announcement by the Intermediate People’s Court of Huaihua City, on April 3, 2020, the court conducted a second-instance sentencing for the case involving dereliction of duty committed by public officials in the “schoolyard body‑burial case” in Xinhuang County, using a remote video‑based trial. The court ruled, in accordance with the law, to dismiss the appeals of nine appellants, including Huang Bingsong and Yang Xuewen, thereby upholding the original verdict in its entirety.

On December 30, 2019, the People’s Court of Jingzhou Miao and Dong Autonomous County, Hunan Province, delivered its first-instance public verdict against ten defendants, including Yang Jun, Huang Bingsong, and Yang Xuewen. Defendant Yang Jun and defendant Huang Bingsong were each sentenced to fifteen years’ imprisonment for the crime of bending the law for personal gain; defendant Deng Shuisheng was sentenced to fourteen years’ imprisonment for the same offense; defendants Liu Hongbo, Chen Shoudian, Cao Riquan, Chen Ling, and Yang Rong’an were each sentenced to fixed-term imprisonment ranging from thirteen to ten years for the same crime; and defendants Yang Xuewen and Jiang Aiguo were each sentenced to nine and seven years’ imprisonment, respectively, for the crime of dereliction of duty.

Following the first-instance verdict, nine defendants, including Huang Bingsong and Yang Xuewen, filed appeals. After reviewing the case on appeal, the Intermediate People’s Court of Huaihua held that the original judgment clearly established the facts, was supported by sufficient and reliable evidence, correctly convicted the defendants, imposed an appropriate sentence, and observed lawful trial procedures. Accordingly, it rendered the aforementioned ruling in accordance with the law.

Other

International public opinion is closely following China’s nationwide mourning ceremony.

The New York Times, Reuters, the Associated Press, the BBC, Russia’s Sputnik news agency, Singapore’s Lianhe Zaobao, and other media outlets have all reported on China’s nationwide mourning event.

The BBC reported that April 4 marked China’s traditional Qingming Festival, during which the country held nationwide mourning ceremonies to honor the martyrs and ordinary citizens who died in the fight against COVID-19. According to the report, on that day, flags were flown at half-mast across the nation in solemn tribute, and all public entertainment was suspended. At 10:00 a.m., people throughout China observed three minutes of silence, while cars, trains, and ships sounded their horns, and air-raid sirens wailed.

According to the report, this marks the first time China has designated a national day of mourning in response to a public health emergency. Prior to this, China had also observed national days of mourning and held nationwide memorial events following the 2008 Wenchuan earthquake, the 2010 Yushu earthquake, and the 2010 Gansu mudslide.

Reuters also reported on the situation in Wuhan, stating, “At 10 a.m., all traffic lights in downtown Wuhan turned red, bringing all road traffic to a halt for three minutes.”

In addition, Singapore’s Lianhe Zaobao noted that numerous Chinese government, news, and portal websites adopted black-and-white color schemes on Qingming Festival to mourn those who have passed away. Starting from midnight on the 4th, central and local government portals—including the website of the National People’s Congress, the website of the Chinese People’s Political Consultative Conference, and the official website of the Chinese government—observed a moment of silence for those who died during the pandemic, using black-and-white backgrounds. China’s mainstream news portals featured black-and-white palettes on their homepage front pages to convey their condolences, while several leading commercial portals and information websites likewise adopted black-and-white designs to pay tribute to the public.

On the 3rd, local time, Richard Horton, editor-in-chief of the British medical journal The Lancet, posted that China’s makeshift hospitals have achieved remarkable success in curbing the spread of the virus. He also called on the international community and the Chinese public to observe a moment of silence in tribute to those who have died from COVID‑19, particularly healthcare workers who lost their lives in the line of duty, thereby designating April 4 as a global day of mourning.

“At this very moment, we pause in silent tribute to the tens of thousands of people from all walks of life who have lost their lives to COVID‑19.” Dr. Gauden Galea, WHO Representative to China, said at 9:50 a.m. Beijing time on the 4th on the WHO’s official Weibo account: “This virus does not discriminate; it has claimed the precious lives of students and teachers, grandparents and grandchildren, bankers and construction workers, doctors and nurses, engineers and farmers—along with our neighbors, friends, and family.” “We must press on in this fight. Let us together honor those who are no longer with us. Their lives and the spirit they leave behind will unite as a source of strength, helping us build a brighter, safer, and healthier future.”

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