JC Master Legal News Issue 1017

Key Takeaways for This Issue

The China Securities Regulatory Commission has issued the revised Measures for the Administration of Securities Registration and Settlement.
To implement the Securities Law and steadily advance the delivery-versus-payment (DVP) reform, the China Securities Regulatory Commission has officially promulgated the revised Measures for the Administration of Securities Registration and Settlement (hereinafter referred to as the “Measures”), which shall take effect as of June 20, 2022.
A new round of the “cars to the countryside” policy is imminent—how can the lower-tier markets boost automobile consumption demand?
Recently, reports indicate that a new round of the “Cars to the Countryside” policy is expected to be unveiled in early June, targeting vehicles priced at RMB 150,000 or below—both conventional and new-energy models—with subsidies ranging from RMB 3,000 to RMB 5,000 per vehicle.
Large-scale refunds of outstanding tax credits are yielding results, bolstering the confidence and resilience of a broad range of market entities.
In May, Qingdao High-Tech Zone—where next-generation information technology serves as the leading industry—was bustling with activity. More than 20 semiconductor-related companies, spanning both upstream and downstream sectors, have gathered there, and a preliminary full‑chain semiconductor ecosystem has taken shape. At the end of February, construction began on the Huaxin Jingyuan third‑generation semiconductor compound crystal substrate project, with a total investment of 700 million yuan. The new‑generation wafer substrates that will be produced at this facility are expected to help China overcome critical bottlenecks in chip manufacturing.
Once an expert opinion has been adopted as the basis for a judicial decision, can the expert institution revoke it?
In judicial practice, because certain key pieces of evidence require specialized expertise for evaluation, expert opinions play a crucial role in ascertaining the facts and clarifying rights and responsibilities. However, once an expert opinion has been adopted by the people’s court as a substantive basis for a final judgment, can the expert appraisal center still revoke it?

Finance & Capital Markets
The China Securities Regulatory Commission has issued the “Notice on Further Leveraging the Functions of the Capital Market to Support Severely Affected Regions and Industries in Accelerating Recovery and Development.”
To thoroughly implement the decisions and arrangements of the CPC Central Committee and the State Council on coordinating epidemic prevention and control with economic development, on May 20, the China Securities Regulatory Commission issued the “Notice on Further Leveraging the Functions of the Capital Market to Support Severely Affected Regions and Industries in Accelerating Recovery and Development” (hereinafter referred to as the “Notice”), which sets forth 23 policy measures.
The Notice focuses on four key areas—strengthening support for direct financing, implementing policies to defer and extend deadlines, optimizing regulatory arrangements, and leveraging the role of industry institutions—by enhancing policy support in such areas as initial public offerings, listings on the Beijing Stock Exchange, refinancing, mergers and acquisitions, corporate bonds, and asset-backed securities. It also provides flexible measures, such as extending time limits for submitting feedback, responding to inquiries, and furnishing financial documentation. Furthermore, it adopts non‑face‑to‑face approaches like video conferences and offers fee reductions or exemptions for listed companies, exchange members, and other relevant parties, thereby demonstrating regulatory flexibility and a more empathetic approach. The Notice seeks to fully harness the capabilities of securities, fund, and futures offices to help combat the pandemic and facilitate the resumption of work and production. Primarily targeted at regions and sectors severely affected by the epidemic—including Shanghai, Jilin, and other areas under comprehensive lockdowns or static management—as well as industries such as catering, retail, tourism, civil aviation, and road, waterway, and railway transportation, the Notice will be dynamically adjusted in response to evolving circumstances.
Since the onset of the COVID‑19 pandemic, the CSRC system has earnestly implemented the decisions and arrangements of the CPC Central Committee and the State Council, working in concert with relevant departments to introduce a series of policies and measures that have provided robust support for coordinating epidemic control, risk prevention, and economic recovery and development. Recently, the domestic epidemic situation has become increasingly complex, and both internal and external uncertainties have intensified. Affected by multiple factors, some enterprises—including listed companies—have suspended operations or experienced production halts, leading to declining performance; midstream and downstream listed offices are facing rising costs; certain industries are struggling to recover from the pandemic; and private‑controlled as well as small and medium‑sized listed companies are encountering markedly greater operational challenges. This Notice represents an important step in implementing the key directives issued at recent meetings of the CPC Central Politburo, the State Council Executive Meeting, and the Financial Stability and Development Committee of the State Council. It will help market entities navigate these difficult times, safeguard capital market stability, and promote the recovery and growth of the real economy.
Going forward, all units and departments within the CSRC system will earnestly ensure the effective implementation of relevant policies, conduct in-depth research and on-site visits to gain a better understanding of market challenges and stakeholders’ needs, strengthen communication and collaboration with other government agencies, and work together to help enterprises address practical issues. By doing so, they will officely advance the execution of these policies, support businesses in overcoming the impact of the pandemic, enable them to swiftly emerge from difficulties, and achieve more robust growth.

The China Securities Regulatory Commission has issued the Measures for the Supervision and Administration of Fund Managers of Publicly Offered Securities Investment Funds, along with its accompanying rules.
To accelerate the high-quality development of the public fund industry, further enhance its capacity to support capital market reform and development, serve household wealth management, and bolster the real economy and national strategies, and to foster a diversified, open, highly competitive industry ecosystem characterized by survival of the fittest and orderly entry and exit, while effectively safeguarding the legitimate rights and interests of fund unit holders, the China Securities Regulatory Commission has revised the Measures for the Administration of Fund Management Companies and renamed them the Measures for the Supervision and Administration of Publicly Offered Fund Managers (hereinafter referred to as the “Manager Measures”). Recently, the CSRC officially promulgated the Manager Measures along with their accompanying rules.
Earlier, the CSRC publicly solicited comments from the public on the “Administrators Measures” and its accompanying rules. Stakeholders generally endorsed the underlying principles and key provisions of these measures and their ancillary regulations, and submitted relevant suggestions and feedback. Following careful review, the CSRC has incorporated and adopted some of these comments.
The “Measures for the Administration of Fund Managers” and its accompanying rules have comprehensively refined regulatory requirements for public‑fund management companies across the entire value chain—covering market access, internal controls, operations, corporate governance, exit mechanisms, and supervision—while emphasizing a balanced approach that combines deregulation with effective oversight. First, the regulations have improved the criteria for establishing fund management companies and for their shareholders, optimized the public‑fund license‑granting regime, upheld high‑level opening-up, and systematically expanded the pool of public‑fund managers, thereby enhancing the industry’s inclusiveness. Second, they have strengthened public‑fund managers’ compliance and risk‑control capabilities, placed greater emphasis on fostering sound industry culture and enforcing integrity in professional conduct, and laid a solid foundation for high‑quality industry development. Third, they have focused on improving corporate governance at fund management companies and established a comprehensive system of long‑term incentives and constraints. Fourth, they support fund management companies in pursuing differentiated growth while reinforcing and expanding their core public‑fund business, enhancing their overall wealth‑management capabilities, and building world‑class wealth‑management institutions. Fifth, they have instituted an exit mechanism for public‑fund managers, allowing market‑driven exits and clearly defining risk‑resolution measures and implementation procedures, thereby ensuring that all relevant parties assume their respective responsibilities.
Going forward, the CSRC will guide its local branches, the Asset Management Association of China, and industry institutions to earnestly implement the “Manager Measures” and their accompanying rules, thereby accelerating the high-quality development of the public fund industry.

The China Securities Regulatory Commission has issued the revised Measures for the Administration of Securities Registration and Settlement.
To implement the Securities Law and steadily advance the delivery versus payment (DVP) reform, the China Securities Regulatory Commission has officially promulgated the revised Measures for the Administration of Securities Registration and Settlement (hereinafter referred to as the “Measures”), which shall take effect as of June 20, 2022.
The revision of the Measures primarily covers three key areas: First, it ensures alignment with the newly added and amended provisions in the Securities Law, which came into effect in March 2020 and pertain to securities registration and settlement activities, by extending the scope of application to include registration and settlement services at other nationwide securities trading venues approved by the State Council, and by further clarifying and detailing the responsibilities of central counterparties. Second, in order to implement the DVP reform’s arrangements for formulating and amending supporting rules, the Measures stipulate procedures for marking securities prior to the full delivery of funds by clearing participants, specify the handling procedures for settlement defaults, and thereby provide robust legal safeguards for the reform. Third, it makes adaptive adjustments to address issues related to securities registration and settlement arising from major capital market reforms in recent years, including Stock Connect, Shanghai–London Stock Connect, and depositary receipt programs. From January 14 to February 13, 2022, the China Securities Regulatory Commission publicly solicited comments on the Measures. Stakeholders expressed strong support for both the DVP reform and the Measures, viewing them as effective steps to enhance the risk‑management capabilities of central counterparties and further improve the foundational systems governing securities registration and settlement.
This DVP reform adheres to the overarching principle of “making progress while ensuring stability,” drawing on internationally accepted practices and tailored to China’s market realities. It leaves investors’ existing trading and settlement systems and habits largely unchanged, with no impact on the vast majority of individual investors. The reform will help strengthen the security of the settlement system and further attract overseas capital into the Chinese market.
The promulgation and implementation of the Measures mark the entry of the DVP reform into a new phase. Going forward, the China Securities Regulatory Commission will guide China Securities Depository & Clearing Corporation Limited in organizing and carrying out the relevant business and technical implementation work for the reform.

China Securities Regulatory Commission: Broaden financing channels for technological innovation and promote the concentration of production factors in the field of scientific and technological advancement.
To thoroughly implement the decisions and arrangements of the CPC Central Committee and the State Council, enhance independent innovation capabilities, and advance breakthroughs in core technologies in key areas, the China Securities Regulatory Commission has guided the Shanghai and Shenzhen Stock Exchanges to officially launch science and technology innovation corporate bonds, building on earlier pilot programs, thereby further strengthening the capital market’s capacity to provide financing support to science and technology enterprises.
Innovation‑driven bonds are designed to enhance the bond market’s targeted support for the science and technology innovation sector and ensure direct access to capital. They primarily serve four categories of issuers—innovation‑focused enterprises, companies undergoing technological upgrading, investors in innovation, and incubators of innovative ventures—while prioritizing financing needs in high‑tech industries, strategic emerging sectors, and the transformation and upgrading of traditional industries. The Shanghai and Shenzhen stock exchanges will provide complementary support in areas such as review procedures and use of proceeds, and have also introduced tailored disclosure requirements for these bonds, mandating that intermediary institutions rigorously fulfill their due‑diligence obligations. Earlier, the two exchanges launched a pilot program for innovation‑driven bonds, under which entities including China Chengtong, China National Investment Holding, Xiaomi Communications, TCL Technology, Zhongguancun Development, and Shenzhen Venture Capital issued a total of 31 tranches, raising RMB 25.3 billion. These funds were chiefly directed toward cutting‑edge fields such as integrated circuits, artificial intelligence, and advanced manufacturing.
Going forward, the China Securities Regulatory Commission will further refine its market‑service initiatives, encourage all market participants to actively engage in the issuance and investment of science‑and‑technology innovation bonds, and enhance the quality and effectiveness of capital‑market support for technological innovation.

China Banking and Insurance Regulatory Commission: Will work with relevant departments to implement policies that encourage the merger and restructuring of small and medium-sized banks.
On May 20, a responsible official from the relevant department of the China Banking and Insurance Regulatory Commission stated at a press briefing that, going forward, the CBIRC will continue to advance the reform and risk mitigation of rural small and medium-sized banks in accordance with the guiding principles of maintaining overall stability, coordinating across sectors, adopting tailored measures, and precisely defusing risks, while further strengthening their capacity to serve the real economy.
A responsible official from the relevant department of the China Banking and Insurance Regulatory Commission (CBIRC) disclosed that, in accordance with the requirements of the Central Committee’s No. 1 Document, the CBIRC has guided pertinent provinces to accelerate rural credit reform, reorient the functional role of provincial credit union federations, establish positive and negative lists for the performance of duties by provincial-level rural credit cooperative institutions, and improve oversight and accountability mechanisms. The Commission has also promoted the seamless integration of Party leadership with corporate governance, rationally structured the “three boards and one layer” and specialized committees, and developed a corporate governance framework that is tailored to the realities of small financial institutions—simple yet practical. Furthermore, it has imposed strict constraints on the conduct of major shareholders, strengthened management of related-party transactions to prevent undue interference in the internal operations and management of institutions, and bolstered senior management teams by encouraging the effective utilization of the executive talent pool established by the banking industry association. The CBIRC supports open and transparent, market‑based recruitment of senior executives, aiming to build a cadre of highly competent leaders who are both politically steadfast and professionally proficient.
“The company and other eligible institutions are participating in the merger and restructuring of rural small and medium-sized banks, working with relevant departments to implement policies that encourage such mergers and restructurings, and advancing the consolidation and regional integration of these banks in accordance with market‑based and law‑based principles,” said a responsible official from the relevant department of the China Banking and Insurance Regulatory Commission.

Commercial & Corporate
Nanjing’s new policy restricting second-hand home purchases was short-lived, lasting only half a day.
On the afternoon of May 20, multiple media outlets reported that restrictions on purchasing secondhand homes in Nanjing have been lifted. At 3:49 p.m. that same day, the Nanjing Real Estate Association also issued a statement conofficeing that, effective May 20, buyers of secondhand properties will no longer be required to provide proof of home‑purchase eligibility. A staff member at a local real estate agency further conofficeed to a reporter from China Times that the news about lifting the secondhand‑home purchase cap is accurate.
However, just two hours after the new policy was announced, Nanjing suspended its measure to lift purchase restrictions on second-hand homes, and the Nanjing Real Estate Association promptly removed the related article.
The first shot at lifting home‑purchase restrictions failed to fire.
On the afternoon of May 20, according to media reports, Nanjing has lifted restrictions on second-hand home purchases, and buyers are no longer required to provide proof of home‑buying eligibility. In response, a reporter from the China Times noted that several local real estate agencies posted on their social media feeds, stating that Nanjing imposes no limits on either the areas where properties can be purchased or the number of units one may acquire; both local and non‑local buyers are free to purchase as they wish; and when transferring ownership of second‑hand homes, proof of home‑buying eligibility is no longer needed.
In response, a reporter from the Huaxia Times called the Nanjing Municipal Commission of Urban and Rural Construction to verify the matter. The commission told the reporter that it was not aware of this information and would need to consult the Housing Administration Bureau. Subsequently, the Huaxia Times reporter contacted the Nanjing Municipal Housing Security and Real Estate Bureau, but as of press time, the calls remained unanswered.
At 3:49 p.m. on May 20, the Nanjing Real Estate Association published an article titled “Our City Further Strengthens Support for Rational Housing Consumption” on its official WeChat account. The article stated that Nanjing is facilitating reasonable home purchases for first-time buyers: effective May 20, 2022, both local and non-local residents purchasing second-hand homes will no longer be required to provide proof of home‑buying eligibility, thereby meeting the legitimate housing needs of new residents and other groups with genuine demand. This directly conofficeed the lifting of restrictions on second-hand home purchases.
Meanwhile, a staff member at a Nanjing real estate agency told a reporter from the Huaxia Times that they had already received notice of the lifting of restrictions on second-hand home purchases. In addition, the same agent said to the Huaxia Times reporter: “The announcement was made this afternoon, and right now there are lines outside the housing administration offices in every district, with people waiting to complete the necessary procedures.”
However, just two hours later, an employee of the real estate agency told a reporter from the Huaxia Times, “It has already been halted.” Meanwhile, the Huaxia Times reporter noted that around 5:30 p.m., the Nanjing Real Estate Association had also removed the aforementioned article. In other words, Nanjing’s policy lifting restrictions on second-hand home purchases lasted only two hours.
Optimization of Policies on Home Purchases for Talents and Public Housing Fund Loan Limits
Notably, Nanjing has recently introduced a series of real estate policies. According to the Nanjing Real Estate Association, the city has refined its housing‑purchase support measures for talent. Specifically, for Category A talents such as academicians, a “housing‑purchase express lane” offering tailored services is now available when they apply for these benefits.
For Category A, B, and C talents who do not apply for the talent housing purchase subsidy, there is no retirement‑age restriction when they seek to avail themselves of talent‑housing services. Furthermore, in addition to the existing home‑purchase restrictions, Category A, B, C, D talents, as well as doctoral‑degree holders, may purchase one additional residential unit.
Meanwhile, Nanjing has expanded the scope of enterprises eligible for talent‑housing subsidies to include listed companies, unicorn and gazelle offices, specialized, refined, distinctive, and innovative enterprises, as well as key software companies. In addition, the eligibility for housing subsidies for talent at “Nanjing‑based universities and municipal‑level or higher research institutes” has been broadened from doctoral degree holders to master’s degree holders.
A reporter from the China Times noted that recently, several cities have increased the maximum loan amounts available under their housing provident fund schemes, and Nanjing is no exception. According to the Nanjing Housing Provident Fund Management Center’s website, when first-time homebuyers use the housing provident fund to purchase a second property, the maximum loan amount will be raised from the current limits of RMB 300,000 per individual and RMB 600,000 per household (for couples) to RMB 500,000 per individual and RMB 1 million per household (for couples).
As for current mortgage rates, the aforementioned real estate agent told a reporter from Huaxia Times: “Right now, first-home mortgage rates in Nanjing are around 4.6% to 4.8%.”
As a popular city in the Yangtze River Delta region, Nanjing’s attempt to fire the first shot in lifting home‑purchase restrictions—though it was withdrawn just two hours after being announced—has already drawn widespread market attention. According to a reporter from Huaxia Times, as of press time, the hashtag “Nanjing lifts purchase restrictions on secondhand homes” had climbed to No. 13 on Weibo’s trending list.
However, even though purchase restrictions have not been fully lifted, Nanjing has already explicitly allowed multi-child families to acquire an additional home. Meanwhile, increasing housing quotas for such families has become a common regulatory measure in many cities. On May 16, Yan Yuejin, Research Director at the E-House Institute Think Tank, told a reporter from China Times that he expects these types of policies to continue expanding and to emerge as a new direction in the easing of housing policies across various regions.
According to data from the National Bureau of Statistics, in April 2022, new-home sales prices in Nanjing fell 0.5% month-on-month but rose 2.4% year-on-year. For the existing-home market, the data show that secondhand home sales prices declined 0.6% month-on-month and 0.9% year-on-year.

A new round of the “cars to the countryside” policy is imminent—how can the lower-tier markets boost automobile consumption demand?
Recently, reports indicate that a new round of the “Cars to the Countryside” policy is expected to be unveiled in early June, targeting vehicles priced at RMB 150,000 or below—both conventional and new-energy models—with subsidies ranging from RMB 3,000 to RMB 5,000 per vehicle.
In response, on May 19, a relevant official from the China Association of Automobile Manufacturers told a reporter from Beijing News’ Shell Finance, “There is no definitive news yet.” Cui Dongshu, secretary-general of the Passenger Car Market Information Joint Association, told the same reporter, “That’s about right. The ‘cars-to-the-countryside’ policy can help raise public awareness, guide consumer behavior, and bolster confidence in spending.” Influenced by this latest round of “cars-to-the-countryside” measures, auto‑related stocks rallied again on May 19; at the close, Zhongtong Bus and JAC Motors both hit their daily upper limits, while Great Wall Motor, Yutong Bus, Dongfeng Motor, BYD, and other automakers followed suit.
Supply-chain disruptions and rising raw-material costs are putting significant pressure on the automotive market.
Since 2021, the domestic automotive market has continued to face significant pressure, driven by supply-chain shortages and rising raw-material prices. According to data from the China Association of Automobile Manufacturers, in April this year, domestic automobile production and sales reached 1.205 million and 1.181 million units, respectively—down 46.2% and 47.1% month-on-month, and down 46.1% and 47.6% year-on-year, marking the lowest levels for the same month in nearly a decade.
Chen Shihua, deputy secretary-general of the China Association of Automobile Manufacturers, stated, “Since April, the automotive industry’s supply chain has endured the most severe challenges in its history. Some enterprises have suspended operations, logistics and transportation have faced significant disruptions, and production capacity has plummeted. At the same time, affected by the pandemic, consumer spending power and confidence have declined markedly, making the task of ensuring steady growth particularly daunting.” He also acknowledged, “At present, consumer demand has indeed been impacted to a certain extent, with demand among buyers of premium brands showing signs of slowing.”
“Regions that are able to do so should promptly introduce relevant stimulus measures,” urged Fu Bingfeng, executive vice president of the China Association of Automobile Manufacturers, recently. “At present, the key to stabilizing growth lies in ensuring the smooth functioning of the automotive supply chain and logistics, and in accelerating the revitalization of the consumer market.”
There is a clear trend of policy-driven encouragement for automobile consumption, with the State Council twice referencing the “cars to the countryside” initiative.
In fact, since the beginning of this year, there has been a clear trend at the policy level to encourage automobile consumption.
At the national level, the State Council Executive Meeting held on April 13 called for encouraging large‑ticket purchases such as automobiles and home appliances, stipulated that local governments must not introduce new vehicle‑purchase restrictions, and directed those already in place to gradually increase the number of new‑vehicle quotas. It also endorsed measures to support consumption of new‑energy vehicles. At the local level, during the first five months of this year, 11 provincial and municipal jurisdictions—including Guangdong Province, Shandong Province, Nanchang City in Jiangxi Province, and Yiwu City in Zhejiang Province—issued policies to boost automobile consumption, employing measures such as consumer subsidies, increased vehicle‑purchase quotas, and trade‑in programs to stimulate domestic auto sales.
Boosted by a series of policy measures, the auto market saw an improvement in sales in May. According to data from the China Passenger Car Association, from May 1 to May 15, nationwide passenger car retail sales totaled 484,000 units, down 21% year-on-year but up 27% compared with the same period last month. Cui Dongshu noted that local governments have been actively introducing region-specific policies to support the auto market, which has helped spur its recovery; however, sustained recovery at the retail level will require robust, long-term policy support.
In February this year, the State Council issued the “14th Five-Year Plan for Promoting Agricultural and Rural Modernization,” which called for encouraging regions with the necessary conditions to implement policies such as a new round of initiatives to bring automobiles to rural areas. On April 25, the General Office of the State Council released the “Opinions on Further Unleashing Consumption Potential and Promoting the Sustained Recovery of Consumption,” which likewise encourages eligible regions to promote new-energy vehicles and advance the development of supporting infrastructure, including charging piles and stations.
Bai Yiyang of China Merchants Securities International Research believes that relaunching the “Cars to the Countryside” program is highly significant. “On the one hand, automobiles, as a quintessential big-ticket consumer good, play a crucial role in stabilizing overall consumption and can stimulate multiple downstream segments, including upstream metals, midstream manufacturing, and downstream services. On the other hand, guided by the principle of ‘common prosperity,’ the income gap between urban and rural areas continues to narrow, and the rural market has experienced relatively limited disruption during the pandemic, giving it considerable consumption potential. Under these circumstances, leveraging fiscal policy could effectively unlock this latent demand.”
Cui Dongshu also stated: “Increasing vehicle‑purchase quotas in cities with purchase restrictions is unlikely to significantly boost consumption; it would be more effective to stimulate demand in small and medium-sized cities as well as in counties and rural areas, where the county‑level market represents a key area for growth.”
The growth trajectory is expanding into lower-tier markets, with experts noting that the automotive market’s focus lies in county-level cities.
In fact, this is not the first time that a policy to promote automobile sales in rural areas has been introduced. As early as January 2009, the State Council’s “Plan for Adjusting and Revitalizing the Automotive Industry” proposed encouraging rural car purchases and providing fiscal subsidies. With the extension of the “Cars to the Countryside” policy at the beginning of 2010 for an additional year, domestic auto sales grew by 45.5% in 2009 and 32.5% in 2010.
In 2018, China’s domestic automobile market posted its first year of negative growth in 28 years. In 2019, the “Cars to the Countryside” policy was revived after a decade, but it expired on December 31, 2020. During 2019 and 2020, domestic auto sales declined by 8% and 1.9%, respectively.
Chen Qingtai, chairman of the China EV100 Association, has predicted that China’s automotive growth will shift from the eastern regions to the central and western areas, expand from first- and second-tier cities to third- and fourth-tier cities, and spread from urban centers to rural areas. Based on an annual average growth rate of 10% in rural residents’ disposable income, by 2030 the rural vehicle ownership per thousand people could reach 160, with total ownership exceeding 70 million vehicles.
Cui Dongshu believes that the key to the automotive market lies in county‑level markets, where both new‑energy vehicles and conventional gasoline cars have substantial growth potential. By fostering the development of eligible counties, we can create numerous new hubs for urbanization and town‑level expansion, nurture promising county‑level economies, and strengthen the foundation of automobile consumption—turning county towns into a fresh engine of growth for China’s automotive sector.
He analyzes that rural populations are currently migrating in large numbers to county seats, and the county‑level market holds enormous growth potential. By leveraging this natural, trend‑driven development, China can propel the economic takeoff of its towns and counties, improve living and employment conditions in county towns, facilitate the redistribution of urban populations, and provide nearby resettlement options for rural residents. As a result, most young and middle‑aged rural people are purchasing homes and settling in county towns, particularly those entering marriage.
Industry insiders believe that the primary beneficiaries of the “cars to the countryside” policy are domestic brands. From a product‑line perspective, these brands have expanded into lower‑tier markets, where their price advantages are particularly pronounced, and they offer a relatively robust lineup of models priced under RMB 150,000.
However, Bai Yiyang believes that this round of the “Cars to the Countryside” initiative still requires attention to two key areas: first, ensuring supply‑side stability; and second, given that the rural market is dominated by mid‑range and mass‑market models, demand will continue to be concentrated on gasoline‑powered vehicles, necessitating automakers to strike an appropriate balance in their new‑energy strategies.
At present, promoting new‑energy vehicles in rural areas still faces certain challenges. Due to restrictions such as vehicle registration requirements and pricing considerations, low‑speed electric vehicles remain more popular in the countryside. Moreover, data from the China Electric Vehicle Charging Infrastructure Promotion Alliance show that, in the first four months of this year, the top five provinces in terms of total public charging stations were Guangdong, Shanghai, Jiangsu, Beijing, and Zhejiang. Cui Dongshu acknowledged that the supporting infrastructure for new‑energy vehicles in rural markets is currently inadequate and requires substantial improvement.

“Carbon” Pathways Lead the Way: State-Owned Enterprises Race to Dominate the New Energy Sector
Data on individuals’ green payments, eco-friendly travel, and sustainable lifestyles can be converted into carbon credits, which can then be redeemed for gifts or used to offset the annual carbon emissions generated by household electricity consumption. Recently, China Southern Power Grid, in collaboration with five banks, launched a co-branded card on a pilot basis in Guangzhou, introducing an inclusive financial service account designed to support carbon neutrality.
This is far from an isolated case. Reporters have observed that, since the beginning of this year, numerous central state-owned enterprises have laid out detailed roadmaps for achieving the “dual carbon” goals, with a flurry of related initiatives—particularly accelerated investments in the new‑energy sector. A series of major projects have been launched one after another, injecting greater green momentum into China’s economic and social development.
A flurry of projects has begun construction.
“Blue panels” are being laid out, and blades are being hoisted—recently, a batch of photovoltaic and wind power projects under China Huaneng have commenced construction in a coordinated rollout, spanning from the grasslands of Inner Mongolia to the Liangshan Mountains of Sichuan, and from the revolutionary base areas of Gansu to the Hainan Free Trade Port.
This energy company, once renowned for its coal-fired power generation, is now stepping up its efforts in the new‑energy sector. In the first half of this year, projects totaling 15 million kilowatts will begin construction one after another, with a projected total investment exceeding RMB 90 billion. Upon completion, these projects are expected to add 39 billion kilowatt-hours of clean electricity annually and reduce carbon dioxide emissions by 39 million tons.
“We will take this as an opportunity to accelerate and intensify the company’s energy‑structure transformation, ensuring that annual new‑energy generation exceeds 100 billion kilowatt-hours, thereby continuously strengthening the company’s profitability and risk resilience,” said Shu Yinbiao, Secretary of the Party Leadership Group and Chairman of China Huaneng.
China National Nuclear Corporation has also played the “green energy card,” with the construction of its first large-scale, integrated “water–wind–solar–storage” base—centered around a pumped-storage hydropower station—recently commencing. This project is the first million‑kilowatt‑class clean‑energy base in northern Xinjiang, built on the foundation of the Burjin Pumped‑Storage Hydropower Project, which boasts an installed capacity of 1.4 million kilowatts. Subsequently, it will be complemented by an integrated water–wind–solar–storage project in the Burjin River Basin, comprising 2 million kilowatts of photovoltaic capacity and 3.6 million kilowatts of wind power. At present, the first phase—a 150,000‑kilowatt wind‑power integration project—has officially begun construction. The project is expected to ultimately achieve a total planned installed capacity of 7 million kilowatts.
The robust momentum of new‑energy projects is evident in China Energy Engineering Group’s recently released “Announcement on Key Operating Data for the First Quarter of 2022”: in the first quarter of 2022, the group secured new contracts totaling RMB 244.07 billion. Notably, new contracts in the new‑energy and integrated smart‑energy sectors increased by 187.54% year over year.
According to data from the National Energy Administration, construction of the first batch of large-scale wind and solar power base projects in desert, gobi, and arid regions has been accelerated this year, driving a year-on-year increase of 202.6% in planned investment for solar power generation and 13.3% for onshore wind power.
Pumping resources into the new energy sector
As the project gains full momentum, numerous central state-owned enterprises have established subsidiaries in various ways, ramping up their efforts to develop the new-energy sector.
Recently, Sinopec Capital Co., Ltd. led an investment in Beijing Zhongke Fuhai Cryogenic Technology Co., Ltd., actively expanding into the integrated development and application of hydrogen energy and helium resources.
Since setting the goal of becoming “China’s No. 1 hydrogen energy company,” Sinopec has been accelerating its deployment in the hydrogen energy sector. According to relevant plans, during the 14th Five-Year Plan period, Sinopec will build 1,000 hydrogen refueling stations or integrated oil–hydrogen stations nationwide, with a total hydrogen‑refueling capacity of 200,000 tonnes per year.
In April this year, CNOOC also established the Beijing New Energy Branch of CNOOC (China) Co., Ltd. Wang Dongjin, Secretary of the Party Leadership Group and Chairman of CNOOC, stated that the new energy branch will further leverage its marine strengths, emphasize integration and synergy, accelerate the development of offshore wind power, selectively advance onshore wind and solar projects, tailor hydrogen‑energy initiatives to local conditions, strengthen R&D in CCUS technologies, and explore the development of multi‑energy complementary integrated energy supply systems, striving to achieve CNOOC’s goal of having new‑energy and emerging‑industry revenues account for 10% by the end of the 14th Five‑Year Plan period.
Since March this year, a series of policies have been rolled out—ranging from the release of the “14th Five-Year Plan for a Modern Energy System” and the “Implementation Plan for the Development of New‑Type Energy Storage during the 14th Five-Year Plan” to the “Medium‑ and Long‑Term Plan for the Development of the Hydrogen Energy Industry (2021–2035),” followed by the issuance of the “Guiding Opinions on Energy Work for 2022”—providing robust support to the new‑energy sector.
Lü Jianzhong, deputy director of the Research Center of China National Petroleum Corporation’s High-End Think Tank, recently wrote that building a robust industrial and innovation chain for renewable energy requires coordinated efforts between traditional fossil‑energy companies and renewable‑energy offices. Traditional energy players should proactively develop their renewable‑energy value chains while rebalancing their existing business portfolios. At present, several oil and coal companies are making related investments; although these initiatives remain modest in scale, they lay the groundwork and accumulate valuable experience for large‑scale deployment in the future.
Charting the Roadmap for “Dual Carbon” Goals
Behind the race by central state-owned enterprises in the new‑energy sector lies both their own need for transformation and development, as well as the overarching trend of China’s efforts to achieve its “dual carbon” goals.
At the end of last year, the State-owned Assets Supervision and Administration Commission (SASAC) issued the “Guiding Opinions on Promoting High-Quality Development of Central Enterprises and Advancing Carbon Peaking and Carbon Neutrality,” which stipulates that central enterprises should play a leading and exemplary role in advancing the nation’s carbon‑peaking and carbon‑neutrality goals. By 2025, central enterprises are expected to reduce their comprehensive energy consumption per 10,000 yuan of output by 15% compared with 2020, cut CO₂ emissions per 10,000 yuan of output by 18% relative to 2020, raise the share of installed renewable‑energy capacity to over 50%, and ensure that revenue from strategic emerging industries accounts for no less than 30%.
Several central enterprises have, based on their specific circumstances, formulated realistic and feasible timetables, roadmaps, and implementation blueprints for peaking carbon emissions, while actively conducting research on pathways to achieve carbon neutrality. For example, CITIC Group recently released its “White Paper on Actions for Peaking Carbon Emissions and Achieving Carbon Neutrality,” which projects that by 2025, the group’s carbon intensity per unit of output will decline by 18% compared with 2020 levels. To this end, it will vigorously advance energy conservation and carbon reduction efforts in four key sectors—power generation, steel production, building operations, and data centers. In the financial sector, the group will continue to expand the scale and share of green finance activities and accelerate innovation in green‑finance business models.
“The accelerated planning and deployment of state-owned enterprises in pursuing the ‘dual carbon’ goals will have a positive impact on the development of related industries, help reduce overall costs associated with industrial transformation and growth, and stimulate other offices to invest in energy conservation, emissions reduction, and low‑carbon initiatives, thereby creating positive incentives for the green transition of upstream and downstream supply chains,” cautioned Professor Sun Chuanwang of the China Energy Economic Research Center at Xiamen University. He emphasized the need to align strategies with local conditions, advance them in an orderly manner, and resolutely prevent “campaign‑style” approaches to carbon reduction.
Taxation TAXATATION
Zero Tolerance for Tax Fraud and Violations: Safeguarding Enterprises’ “Life-Saving Funds”
“With regard to illegal and criminal acts of fraudulently obtaining additional tax credit refunds, we have maintained a zero‑tolerance policy—striking at the first sign, acting early and on a small scale, and ensuring precision and severity. From April 1 to May 16 this year, a total of 2,880 enterprises suspected of fraudulently claiming such refunds were placed under investigation, and 118 cases of refund fraud have been publicly disclosed nationwide, sending a strong signal that ‘tax fraud will be severely cracked down upon’ and ‘violations will be rigorously punished,’ thereby resolutely preventing the ‘benefits’ of tax and fee reductions from falling into the hands of lawbreakers. At the same time, 25 cases involving tax officials held accountable for dereliction of duty or negligence have been made public, particularly a handful of instances where insiders colluded with external parties and were subject to formal investigation, underscoring our unwavering commitment to zero tolerance and reafofficeing the principle that ‘those who enforce the law must themselves be above reproach.’” At a press conference on fiscal and tax reform and development hosted by the Publicity Department of the CPC Central Committee, the State Taxation Administration outlined the tax authorities’ efforts to combat fraudulent claims for additional tax credit refunds, as well as the accountability measures imposed on tax officials found to have failed in their duties or neglected their responsibilities in implementing the refund policy.
On May 11, the State Taxation Administration, the Ministry of Public Security, the Supreme People’s Procuratorate, the General Administration of Customs, the People’s Bank of China, and the State Administration of Foreign Exchange jointly convened a national conference to advance efforts to combat fraudulently obtained value-added tax credit refunds. The meeting emphasized that cracking down on such fraud must be treated as the top priority in the six departments’ ongoing, routine enforcement work, with a focus on organized, cross‑regional schemes involving the fraudulent issuance of invoices and the false claiming of input tax credits to obtain refunds. A zero‑tolerance approach will be adopted to resolutely suppress these illegal and criminal activities, creating an overwhelming deterrent and ensuring the effective and proper implementation of the VAT credit refund policy. On May 17, the six departments jointly issued a notice calling for stringent measures against illegal and criminal acts of fraudulently obtaining VAT credit refunds, requiring swift detection, prompt response, and decisive action against any such violations as soon as they are detected. Throughout the implementation of this year’s large‑scale VAT credit refund policy, the tax authorities’ zero‑tolerance stance toward unlawful and non‑compliant conduct has not only effectively supported the smooth rollout of the refund program but has also played a positive role in upholding tax fairness and safeguarding the rule of law.
In 2022, China’s economic development faced triple pressures: shrinking demand, supply shocks, and weakening expectations. In response, the CPC Central Committee and the State Council rolled out a new package of tax and fee support measures, with an estimated total of approximately RMB 2.5 trillion in tax refunds and reductions for the year—of which about RMB 1.5 trillion was in the form of carryforward VAT refunds—helping enterprises alleviate difficulties. To ensure that these funds reached market entities promptly, the Ministry of Finance coordinated fund reallocations and accelerated disbursement, while the tax authorities comprehensively streamlined refund-processing procedures, boosting efficiency. From April 1 to May 16, a total of RMB 979.6 billion in carryforward VAT refunds was credited to corporate accounts nationwide. As is often the case, where there is light, there is shadow: numerous illegal actors have begun to exploit this policy dividend. Therefore, safeguarding enterprises’ “life‑saving funds” is a crucial step in ensuring that favorable policies deliver their intended benefits.
Deterting illegal conduct and ensuring the effective implementation of policies. In fact, since mid-April, tax authorities have successively publicized several batches of high‑profile cases involving fraudulently obtaining additional tax refunds, as well as typical instances of tax officials being held accountable for dereliction of duty. These actions underscore the tax authorities’ unwavering resolve to crack down on tax‑related violations and uphold a law‑based, fair tax environment. They also highlight the authorities’ capacity to leverage tax‑big data for precise oversight, discouraging those who seek to exploit national policy benefits and thereby better safeguarding fiscal funds and facilitating the smooth rollout of policy measures.
Safeguarding tax fairness and enhancing taxpayer compliance. Only when the state levies taxes in accordance with the law and taxpayers pay their taxes as required by law can market entities fully benefit from a fair tax environment. Tax authorities are vigorously cracking down on tax fraud and encouraging lawful, compliant utilization of tax incentives, ensuring that more taxpayers who comply with tax obligations and claim refunds not only reap the benefits of these policies but also strengthen their sense of equity in the tax system, thereby further boosting overall societal tax compliance.
Safeguarding the dignity of the law and advancing the rule of law. Based on the VAT credit‑refund fraud cases currently disclosed by the tax authorities, illicit actors typically obtain fraudulent refunds by issuing false invoices to inflate input VAT credits, reduce output VAT liabilities, and file false returns. Whether it involves issuing fake invoices or falsifying accounting records, China’s Criminal Law, Tax Collection and Administration Law, and Accounting Law all prescribe penalties for such conduct. Rigorously investigating and prosecuting tax fraud is a crucial means of upholding the authority of the law. Meanwhile, since the 18th National Congress of the Communist Party of China, the drive to build a country under the rule of law has accelerated, and the development of tax‑related legal frameworks has continued to deepen. Alongside efforts to advance tax legislation, standardizing tax enforcement and strengthening oversight of enforcement are equally essential components that must not be overlooked.
“Even forging iron requires a strong hammer.” Notably, this time the tax authorities have publicized several high‑profile cases in which tax officials failed to perform required verifications of enterprises’ eligibility for tax refunds and other critical information, or neglected to cross‑check relevant申报 data as mandated—resulting in inaction, sluggish action, or improper action. Additionally, tax personnel suspected of colluding with external parties to fraudulently obtain additional credit‑refund benefits have been placed under investigation and publicly exposed, demonstrating to the public a tax‑law enforcer that neither shelters nor protects wrongdoing, but upholds impartiality and lawful enforcement.
When the rule of law thrives, the nation prospers; when the rule of law is strong, the nation grows powerful. A zero‑tolerance policy toward fraudulent claims for tax refunds and internal negligence, dereliction of duty, and violations of laws and disciplines not only safeguards national tax revenue, economic order, and social fairness and justice, but also contributes to the advancement of the rule of law.

Large-scale refunds of outstanding tax credits are yielding results, bolstering the confidence and resilience of a broad range of market entities.
In May, Qingdao High-Tech Zone—where next-generation information technology serves as the leading industry—was bustling with activity. More than 20 semiconductor-related companies, spanning both upstream and downstream sectors, have gathered there, and a preliminary full‑chain semiconductor ecosystem has taken shape. At the end of February, construction began on the Huaxin Jingyuan third‑generation semiconductor compound crystal substrate project, with a total investment of 700 million yuan. The new‑generation wafer substrates that will be produced at this facility are expected to help China overcome critical bottlenecks in chip manufacturing.
Recently, Qingdao Huaxin Jingyuan Semiconductor Technology Co., Ltd. received a carryforward VAT refund totaling RMB 9.87 million. “For us, the carryforward VAT refund policy has been both a timely lifeline and a valuable boost, helping us promptly ease cash-flow pressures, freeing up more funds for R&D, and strengthening our confidence and momentum for future growth,” said Xu Shuo, the company’s finance director.
Since the beginning of this year, both domestic and international environments have grown increasingly complex and uncertain, placing mounting pressure on market entities. Under these circumstances, leveraging macroeconomic policy tools in both counter-cyclical and cross‑cycle adjustments is of paramount importance for the survival and sustainable development of a broad range of market players.
The manufacturing sector features strong upstream–downstream linkages and robust spillover effects on the service industry and employment, making it a cornerstone and foundation of national development. It also serves as a key focus for advancing supply-side structural reform, driving economic transformation and upgrading, and facilitating the shift from old to new growth drivers. The large-scale policy of refunding outstanding tax credits not only provides immediate relief to enterprises but also aims to stimulate their intrinsic momentum, thereby supporting steady yet progressive economic development.
According to a responsible official from the Department of Goods and Services Tax of the State Taxation Administration, since the implementation of the large-scale value-added tax credit refund policy, as of May 16, a total of RMB 979.6 billion in refunds has been credited to corporate accounts. The six sectors that have benefited most from both existing‑stock and incremental VAT credit refunds are manufacturing; the electricity, heat, gas, and water production and supply industries; the transportation, warehousing, and postal services sector; the scientific research and technical services sector; the software and information technology services sector; and the ecological protection and environmental governance sector.
The large-scale policy of refunding outstanding input VAT credits is yielding results, steadily bolstering the confidence and resilience of market entities.
In Inner Mongolia, Zhalute Banner Lutou Jietai Power Co., Ltd. primarily engages in energy‑related activities, including technological development for energy projects, photovoltaic power generation, wind power generation, and energy storage. The Zhalute Banner Tax Bureau determined that the company falls under the electricity and heat production and supply sector—one of the six key industries eligible for the newly introduced, more robust policy on incremental input VAT credit refunds. In early April, bureau staff assisted the taxpayer in processing the incremental input VAT credit refund, with the refund amount totaling RMB 11.3423 million.
“In 2018, the company invested in and constructed a photovoltaic power station in Zhalute Banner, with a total investment of RMB 150 million. Following commissioning, however, the national subsidy funds had yet to be recovered, placing significant financial strain on the company. The tax rebate has helped ease liquidity pressures and alleviated the operational challenges facing the project,” said Lu Haidi, the company’s chief financial officer.
In Jilin, Jilin Jinghua Pipe Manufacturing Co., Ltd., which primarily produces steel pipes and steel-plastic composite pipes, has allocated the 10.38 million yuan in additional tax refunds it received to the construction of a new production line for spiral welded pipes. “The additional tax refund has not only eased the company’s cash-flow pressures but also bolstered its confidence in future growth,” said Li Hongda, the company’s general manager. He added that this “tax rebate bonus” has alleviated the company’s concerns and strengthened its resolve to pursue innovative development.
Beijing Xingyu Vehicle Technology Co., Ltd. is a Tier‑1 supplier to Beijing Hyundai. In recent years, the company has been adversely affected by the overall slump in sales of Korean‑brand vehicles, resulting in a marked decline in revenue and an urgent need for capital to support its transformation and upgrading. Recently, the company received a tax refund of RMB 10.32 million under the carryforward VAT credit policy.
“After receiving the tax refund, we have primarily allocated the funds in two ways: first, to continue investing in R&D for new‑model production lines, introducing two new lines—NU2 and OE; and second, to ensure stable business operations. The receipt of the carryforward VAT refund has effectively eased our financial pressures, bolstered our cash flow, reduced our financing costs, and facilitated smoother working capital management, thereby strengthening our resolve and confidence to overcome current challenges,” said a representative from Beijing Xingyu Vehicle Technology Co., Ltd.
In the Circular Chemical Industry Park of the Jinzhou Economic Development Zone in Hebei Province, Yili Clean Energy Technology (Jinzhou) Co., Ltd. is the park’s sole heat source. During the company’s initial construction phase, substantial capital investment led to a significant amount of input VAT credit; compounded by the impact of the pandemic, project progress was delayed, placing the enterprise under considerable operational strain.
In April this year, a new policy introducing large-scale refunds of outstanding VAT credit balances was implemented. Under the policy, the company received a one-time refund of 3.38 million yuan for its existing credit balance. “With the support of this policy, the first phase of our project has already been commissioned, and a new photovoltaic project has also broken ground. We expect that by the end of this year, the residential heating project will likewise be brought online,” said Gao Li, the company’s chief financial officer.
In an interview with a People’s Daily reporter, fiscal and tax experts stated that the carryforward VAT refund policy has precisely benefited market entities, significantly bolstering enterprises’ viability, growth capacity, and confidence, thereby serving as a crucial measure to withstand downward economic pressures and promote stable, healthy economic performance.
Li Xuhong, Director of the Institute for Fiscal and Taxation Policy and Application at the National Accounting Institute in Beijing, stated in an interview with People’s Daily Online that large-scale refunds of outstanding input VAT credits represent one of China’s key measures to innovate its macroeconomic regulation. Not only do they help address the longstanding issue of accumulated credit balances that has persisted for years, thereby upholding the neutrality principle of the modern value-added tax system, but they also alleviate funding constraints faced by enterprises of varying sizes, serving as a powerful “booster” for economic growth. By adopting targeted policies and allowing liquidity to flow freely to nurture businesses, these measures help invigorate market dynamism.
“Front-loaded policy implementation is a salient feature of current macroeconomic policymaking,” says Yao Fengmin, a professor at Guangdong University of Finance and Economics. He adds that channeling liquidity directly to enterprises can provide much-needed financial support, helping struggling offices navigate challenges and gain momentum, thereby enabling them to operate with greater agility and efficiency.
“The new policy on refunding outstanding input VAT credits provides a one-time refund of existing credit balances to small and micro enterprises, the manufacturing sector, and five other industries, significantly boosting market confidence,” said Wang Tingting, an associate professor at the School of Economic Law of Southwest University of Political Science and Law and a researcher at the China Institute for Tax and Fiscal Rule of Law, in an interview with People’s Daily Online.
“It is worth noting that, for the local‑government share of the newly introduced additional tax credit refunds, the central government provides subsidies covering an average of over 82%, with a greater allocation to the central and western regions. This underscores the state’s commitment to supporting enterprises in resuming growth and stabilizing the macroeconomy, and will ensure that market entities can promptly and fully benefit from the policy dividends,” said Wang Tingting.

Anhui: “One-Stop Inquiry and Handling” Tackles Tax-Related Challenges
“With just one phone call, the issue with my social security contributions was resolved within a few days—the tax authorities’ efficiency is truly commendable,” Mr. Zeng recently told the 12366 taxpayer service hotline. He explained that he had been unable to find his company’s portion of last month’s social security payments when checking his records. Upon receiving the case referral from the Chuzhou Municipal Tax Service Bureau, the Mingguang City Tax Service Bureau of the State Taxation Administration thoroughly investigated Mr. Zeng’s concerns, promptly coordinated with the Mingguang City Medical Insurance Bureau and the employer, identified the root cause of the problem, and, with the tax authorities’ mediation, resolved it in a timely manner.
To promptly and efficiently address taxpayers’ and payers’ tax-related concerns, the Mingguang Municipal Tax Service Bureau actively coordinates with relevant departments to ensure that all issues are resolved effectively and concretely. For matters that have been concluded, the bureau conducts timely follow-up visits, verifies the outcomes with the callers, and carries out satisfaction surveys, thereby ensuring that every issue raised by taxpayers and payers is properly addressed and receives a response.
Since the beginning of this year, the Anhui Provincial Tax Service Bureau has, in line with the “Opinions on Further Deepening Tax Collection and Administration Reform” and the requirements of the “Doing Practical Things for Taxpayers and Payers and the Spring Breeze Action for Convenient Tax Services,” comprehensively advanced the development of a 12366 taxpayer‑payer service hotline system featuring “first‑call responsibility, network‑wide coordination of tax‑related resources, real‑time referral of tax‑related issues, and accountability assigned to specific personnel within a grid‑based framework.” Pilot programs have already been launched in Bahe District of Hefei, Chuzhou, Huainan, and other localities.
It is reported that the establishment of this service system has launched a new model of an integrated taxpayer‑service team spanning four levels—namely, the 12366 hotline, the provincial bureau’s business divisions, the tax service counter, and the grassroots tax bureaus’ tax‑source management departments. This approach enables online consultation and swift processing of matters, creating a “fast‑response channel for taxpayer requests” that integrates inquiry, handling, verification, evaluation, and feedback. The channel can be initiated either by the 12366 hotline, which routes relevant tax‑related (fee‑related) inquiries to the tax service counter and grassroots tax‑source management units for resolution, or by the tax service counter or grassroots tax‑source management units, which share policy‑advisory resources with the 12366 hotline to provide efficient and accurate responses to tax‑policy queries. This service initiative streamlines tax‑filing procedures, facilitates two‑way communication, and ensures that taxpayers and payers’ complex business inquiries, complaints, reports, and other urgent tax‑related requests—whether submitted via the 12366 hotline or other channels—are addressed promptly.
“After calling the 12366 hotline for consultation, staff from the Lai’an County Tax Bureau promptly reached out to us. With patient guidance from the Remote Assistance Center, we submitted our tax refund application, and the refund of 460,000 yuan was credited to our account in a timely manner,” said Chen Nana, a tax officer at Chuzhou Kezhisheng Environmental Protection Materials Co., Ltd. Following her inquiry with the Remote Assistance Center about how to process the value-added tax credit refund, the “Inquiry-and-Processing Integration” coordination team’s expert panel immediately coordinated with the operator to provide technical support, helping the taxpayer successfully complete the online VAT credit refund procedure.
An official from the Anhui Provincial Tax Service Bureau stated that this measure effectively breaks down barriers stemming from differences in business authority, job responsibilities, and geographic boundaries, thereby addressing the issue of separation between tax service delivery and handling. To date, more than 40,000 urgent tax-related requests from taxpayers and payers have been processed, along with 1,824 tax-related complaints. Moving forward, the bureau will further optimize its service platform to enable one-click consultation and end-to-end online processing.

Litigation & Arbitration
Deceptive advertising, price gouging… Gyms employ numerous consumer‑tricking tactics—how can you protect your rights?
Recently, “Liu Genghong girls” have become a hot topic of discussion. During the pandemic, while under home quarantine in Shanghai, Liu Genghong livestreamed fat‑burning workout classes online, inspiring people to exercise at home. In just seven days, his follower count surged by 10 million, making him a “phenomenal” figure in the livestreaming world. As living standards continue to rise, people’s pursuit of health is growing stronger, and many fitness enthusiasts with no prior experience are increasingly turning to gyms to receive professional guidance and burn calories in a structured way. However, as consumers hit the gym and work up a sweat, they should also remember to safeguard their legitimate rights and interests.
Recently, the People’s Court of Gulou District in Fuzhou, Fujian Province, found during case proceedings that consumer disputes over fitness services—stemming from issues such as false advertising, price fraud, prepaid‑only consumption, difficulties in obtaining refunds when gyms close or cease operations, and uneven service quality—are on the rise. These cases have increased significantly year over year, seriously infringing upon consumers’ legitimate rights and interests. In response, the Gulou Court has compiled and outlined common types of fitness‑related consumer disputes, offering guidance on how to avoid consumer traps and effectively leverage the Civil Code and relevant laws and regulations to safeguard one’s rights.
Frequently changing personal trainers
Severe disagreements lead to contract termination and refunds.
Between August and September 2018, Mr. Yang entered into a Fitness Instructor Training Agreement with a certain fitness institution, purchasing multiple training courses, including regular classes, stretching sessions, and boxing lessons, totaling over 150 sessions at a combined price of more than RMB 98,000. The agreement stipulated that once a member signed the contract and selected specific courses, cancellations would not be permitted; in the event of cancellation, the service fee would be non‑refundable. Furthermore, should an instructor take leave, resign, or transfer to another position, the fitness institution reserved the right to assign a substitute instructor without further notice; members could also request a replacement if they were dissatisfied with their assigned coach.
Subsequently, dissatisfied with the fitness center’s repeated changes of personal trainers, Mr. Yang, after attending more than 70 sessions, stated that he no longer wished to continue receiving fitness training services and sought a refund of the remaining course fees amounting to RMB 54,000 from the fitness center. His request was rejected. Mr. Yang then brought the matter before the court, seeking to terminate his contract with the fitness center and to compel the center to refund the outstanding course fees and pay liquidated damages.
The Gulou District People’s Court, after trial, found that, given the highly personal nature of fitness service contracts and the reliance on a foundation of trust in their performance, the consumer’s individual experience is of paramount importance. The “Fitness Coach Training Agreement” entered into by Mr. Yang and a certain fitness institution was structured as a prepaid‑consumption model. During the training period, despite the consumer having already paid the full fee for the fitness services, the fitness institution repeatedly changed the private coach. As a result, the consumer no longer wished to continue receiving the services, and serious disputes had arisen between the two parties.
The court held that, since the contract is not suitable for compulsory performance and is structured as a prepaid‑consumption arrangement, Mr. Yang should be permitted to decide whether to continue receiving the remaining services that have yet to be utilized. Accordingly, Mr. Yang’s claim for contract termination and refund of the outstanding course fees was upheld. However, in the absence of any evidence demonstrating that the fitness center had committed a breach of contract, the court rejected Mr. Yang’s request for liquidated damages. Ultimately, the court rendered a judgment in accordance with the law, ordering the termination of the contractual relationship between Mr. Yang and the fitness center and directing the fitness center to refund Mr. Yang RMB 54,000 representing the balance of his course fees.
After the hearing, the judge stated that consumers typically purchase training services based on their choice of a personal fitness trainer, and changes in trainers as well as the degree of compatibility directly affect the achievement of the contract’s intended purpose. Fitness facilities have an obligation to ensure the stability and continuity of the services they provide; if a change of trainer or service is necessary, they should promptly communicate and negotiate with consumers to prevent disputes.
Meanwhile, the judge cautioned consumers to practice responsible spending: when purchasing fitness classes, they should compare options carefully and choose prudently, avoiding large upfront payments. Upon signing a contract, they should thoroughly review its terms and verify the qualifications of the instructors provided by the fitness facility. If specific requirements are set for a personal trainer and no substitutions are acceptable, such conditions should be explicitly stated in the agreement; otherwise, consumers may assume the associated transaction risks.
Instructor negligence resulted in a trainee’s injury.
Contract termination, refund, and compensation
Starting on July 20, 2020, Mr. Zhuang successively entered into several private‑training contracts with a certain fitness service company and paid a total of RMB 30,660 in course fees. On October 16 of the same year, while participating in a private training session and performing exercises under the coach’s guidance, Mr. Zhuang sustained an injury and was promptly taken by the coach to a local hospital for treatment. In the period that followed, he sought medical care at multiple hospitals, incurring total medical expenses of RMB 3,468.40. During his recovery, Mr. Zhuang’s mobility was severely restricted, significantly impacting both his work and daily life.
Following the accident, Mr. Zhuang repeatedly sought to negotiate with the fitness service company regarding compensation for medical expenses and other damages, but to no avail. Consequently, he filed a lawsuit in court, seeking to terminate the personal training contract he had entered into with the fitness service company, obtain a refund of the remaining course fees, and recover corresponding losses for medical expenses and lost wages.
Upon trial, the court found that Mr. Zhuang entered into the private‑training contract at issue with a certain fitness service company, with the purpose of achieving physical fitness and health through the professional guidance provided by the company. The performance of such private‑training contracts likewise hinges on consumers’ trust in the provider’s expertise. However, because the personal trainer assigned by the fitness service company failed to offer scientifically sound and reasonable fitness guidance, Mr. Zhuang sustained injuries, thereby undermining the foundation of trust upon which the contract was based and rendering the contractual objectives unattainable. Accordingly, Mr. Zhuang’s request to rescind the contract was granted by the court.
The court held that, since Mr. Zhuang only used a portion of the courses, the fitness service company should refund the remaining course fees to him. Furthermore, as Mr. Zhuang’s losses were caused by the fitness service company’s improper provision of fitness services, the company is liable for compensation.
Ultimately, the court, in light of the loss‑related evidence submitted by Mr. Zhuang, rigorously determined the amount of damages and rendered a judgment in accordance with the law: the contractual relationship between Mr. Zhuang and a certain fitness service company was terminated; the fitness service company was ordered to refund Mr. Zhuang RMB 30,320 in service fees and to pay compensation for the loss arising from the use of funds; furthermore, the fitness service company was required to compensate Mr. Zhuang RMB 25,659.9 for medical expenses and lost wages.
After the hearing, the judge stated that in recent years, personal training sessions have become increasingly popular in the fitness industry and are favored by consumers. When choosing a gym or a personal trainer, consumers should carefully verify the other party’s qualifications. Moreover, during personal training sessions, if any discomfort arises or if a particular exercise exceeds one’s physical limits, participants should immediately report it to prevent injury. As for fitness service providers, they should strengthen the training and management of their staff, assess clients’ physical conditions, and enhance measures to ensure client safety.
Unauthorized closure of swimming facilities
Refund of membership fees in case of breach of agreement
On September 14, 2018, a fitness club in Fuzhou opened, advertising year-round heated swimming pool facilities. Mr. Zhang, intending to have his child swim and stay fit, planned to purchase a swimming and fitness membership card. Upon applying, he learned that the club did not offer standalone swimming cards; however, members could access both the swimming pool and other fitness services. Consequently, Mr. Zhang became a ten-year member of the club, paying a membership fee of RMB 14,780.
After Mr. Zhang had been a member of a certain fitness club for some time, the swimming pool was suddenly closed. During subsequent negotiations, the fitness club informed Mr. Zhang that the swimming pool had been shut down due to poor management and offered him the option to continue using other fitness facilities or to swim at another branch of the same club. Mr. Zhang argued that his original purpose in purchasing a membership was to access the swimming‑pool facility and that he had never availed himself of any other fitness services. He contended that the fitness club’s unilateral closure of the swimming pool had infringed upon his legitimate rights and interests, and therefore brought the matter before the court, seeking a refund of his membership fee.
The court, after hearing the case, held that, in accordance with the Consumer Rights Protection Law, when a business operator provides goods or services on a prepayment basis, it shall deliver them as agreed. If it fails to do so, it must either fulfill the agreement at the consumer’s request or refund the prepayment, and it shall also bear the interest on the prepayment as well as any reasonable expenses that the consumer is required to pay.
In this case, a certain fitness club collected membership fees in advance from Zhang and undertook to provide fitness services, including access to a swimming pool. However, due to reasons attributable to the club itself, the swimming pool was closed, and the club failed to deliver the agreed‑upon services, thereby rendering the purpose of Zhang’s contract for swimming‑pool access unattainable, which constitutes a fundamental breach of contract. Furthermore, pursuant to the provisions of the Civil Code, Zhang is entitled to demand that the fitness club refund the unconsumed portion of the prepaid fees, and the contractual relationship between the parties is accordingly terminated. Accordingly, the court rendered a judgment in accordance with the law: the contractual relationship between Zhang and the fitness club is terminated; after deducting the amount corresponding to the services already consumed by Zhang, the fitness club shall refund to Zhang the remaining membership fee of RMB 12,563.
After the hearing, the judge stated that once a consumer becomes a member of a fitness club, they are entitled to exercise their membership rights and enjoy all the services offered by the club. As the provider of fitness services, the gym must ensure that it delivers services in accordance with the promises it has made to consumers. Moreover, when offering multiple services, the gym must guarantee the integrity and completeness of those services.
The swimming pool is an essential component of the services offered by a certain fitness club. By unilaterally closing the swimming pool, the club has breached the membership agreement it entered into with its members, thereby infringing upon consumers’ legitimate rights. Consumers are entitled to request contract termination and a refund of any unused membership fees. In addition, consumers are advised to practice prudent spending when using fitness facilities, carefully review membership agreements, and avoid making large one-time top-ups. It is also important to retain proof of payment and maintain detailed records of expenditures to mitigate potential risks in the future.

VAT invoices were fraudulently issued to the tune of RMB 1.466 billion! In Jiangxi, four corporate “bosses” have each been sentenced to more than 10 years in prison.
A gentleman loves wealth, but acquires it through proper means; yet some people lose themselves in the pursuit of riches and ultimately end up behind bars.
A company in Ji’an, Jiangxi Province, used the guise of “nonferrous metals” trading to fabricate purchase contracts for “electrolytic copper,” falsely issued VAT invoices totaling RMB 1.466 billion to offset taxes, and thereby caused a total loss of RMB 168.6 million in national tax revenue.
Recently, the People’s Court of Ji’an County, Jiangxi Province, concluded this case involving the fraudulent issuance of special value-added tax invoices in accordance with the law, sentencing all four defendants to prison terms of ten years or more.
Case Summary
In June 2019, the defendants Xu and Wu registered and established Ji’an Hengmouyuan Trading Company.
In August 2019, the two individuals, in collusion with Li and Zhou, engaged in the business of selling electrolytic copper.
During their business operations, they uncovered certain illicit practices in the electrolytic copper market. Some unscrupulous upstream companies were able to issue special VAT invoices for the purchase of electrolytic copper even in the absence of actual transactions, with strong concealment and substantial profits. Unable to resist the lure of hefty returns, the four individuals decided to take a risky gamble.
According to the findings of the public security authorities, between August 2019 and April 2020, the four defendants, under the pretext of purchasing “electrolytic copper,” obtained a large number of falsely issued special value-added tax invoices from upstream companies located in Hebei, Shandong, Sichuan, Shanghai, Hubei, and other regions. In less than one year, the total face value and tax amount of these falsely issued special VAT invoices reached RMB 1.466 billion, with a tax component of RMB 168.6 million, all of which were subsequently used by the local tax authorities to offset taxes.
To pass scrutiny by the relevant authorities, they fabricated false purchase‑and‑sale contracts and concocted fictitious records of warehouse transactions and fund flows, thereby creating closed loops for both goods‑trade and financial‑flow data. With each successful operation, their ambitions grew ever larger. During a tax‑authority inspection, the company’s transaction data flagged as anomalous; subsequent investigation by the public security organs brought the scheme to light.
Court proceedings
After trial, the People’s Court of Ji’an County, Jiangxi Province held that, following the establishment of their company, the defendants Xu and Wu, in collusion with defendants Li and Zhou, engaged in the fraudulent issuance of value-added tax invoices for the purpose of illicit profit, involving an enormous sum. The conduct of defendants Li, Xu, Zhou, and Wu all constitutes the crime of fraudulently issuing special value-added tax invoices. In the first instance, the court sentenced defendant Li to thirteen years’ imprisonment and a fine of RMB 500,000 for the crime of fraudulently issuing special value-added tax invoices; defendant Xu to twelve years’ imprisonment and a fine of RMB 400,000; defendant Zhou to ten years and six months’ imprisonment and a fine of RMB 300,000; and defendant Wu to ten years and six months’ imprisonment and a fine of RMB 300,000. The public security authorities have confiscated all proceeds of crime seized or frozen in the case and turned them over to the state treasury.
Judge’s Reminder
The act of issuing false special value-added tax invoices severely disrupts the self-regulating mechanisms of the market economy and the state’s fiscal‑tax regulatory tools, while also undermining the order of tax collection and administration. The penalties for such offenses are substantial. No enterprise or individual should take reckless risks or cross the legal red line; otherwise, they will inevitably face legal sanctions.

Once an expert opinion has been adopted as the basis for a judicial decision, can the expert institution revoke it?
As we all know, “expert opinions” constitute one of the eight statutorily recognized categories of evidence in civil litigation. They are conclusions reached by specialized appraisal institutions—appointed by the court or requested by the parties—to evaluate key evidence. These opinions are formulated by experts possessing relevant professional knowledge, technical expertise, and practical experience, who employ specialized technical knowledge, skills, procedures, and various scientific instruments and equipment to analyze and distinguish complex issues. In judicial practice, because certain critical pieces of evidence require specific professional expertise for evaluation, expert opinions play a crucial role in ascertaining the facts and clarifying rights and responsibilities. However, once an expert opinion has been adopted by the people’s court as a substantive basis for a final judgment, can the appraisal center still revoke it? Before addressing this question, let us first examine a case recently accepted by the Xigu District People’s Court of Lanzhou City, Gansu Province…
In June 2021, Liu, a resident of Xincheng Town in Xigu District, struck pedestrian Cai while driving. Cai was immediately taken to a hospital for treatment. On the day of the accident, the Xigu Traffic Police Brigade promptly handled the case and determined that Liu bore full responsibility. Cai also applied to a forensic appraisal institution for an assessment of his disability, which concluded that he sustained a Grade‑9 disability. Subsequently, unable to reach an agreement on compensation, Liu and Cai brought the matter before the court. Relying on the Road Traffic Accident Determination Report and the appraisal opinion, the Xigu People’s Court rendered a first‑instance judgment, establishing Liu’s liability for compensation. Following the pronouncement, neither Liu nor Cai filed an appeal, and the judgment has thus become legally effective.
Logically, the case should have been concluded at this point. Yet, half a year later, Liu filed a petition for retrial with the Xigu District People’s Court, arguing that the expert opinion upon which the judgment was based had been revoked by the forensic appraisal center. What, then, is the story behind this?
It turned out that, after the judgment in this case became final, Liu unexpectedly learned that the time taken by the appraisal center to issue its expert opinion had exceeded the statutory deadline for disability assessments. Consequently, citing “excessive appraisal duration,” Liu approached the appraisal center to press his case. Although the appraisal center explained the relevant reasons to Liu and clarified that the opinion was based on original documents such as Cai’s medical records at the time of hospitalization—asserting that the length of the appraisal process would not affect the scientific validity of the opinion—Liu remained unyielding, insisting that the center rescind its expert opinion. Reluctant to engage in further fruitless disputes, the appraisal center reluctantly agreed and issued a letter of withdrawal to the Xigu District People’s Court. On this basis, Liu filed a petition for retrial with the court.
Given that the forensic appraisal center has already agreed to revoke its appraisal opinion, will the court likewise grant Liu’s application for retrial? The presiding judge held that, in the first instance, the People’s Court commissioned a judicial appraisal institution to assess Cai’s degree of disability and level of nursing dependency; the commissioning procedure fully complied with legal requirements, and both the appraisal institution and the appraiser met the requisite qualifications. Moreover, the appraisal opinion was presented as evidence in court and subjected to cross-examination by all parties, thus qualifying as admissible evidence for establishing the facts of the case. The length of time taken for the appraisal does not materially affect the validity of the opinion and does not constitute a serious violation of the appraisal procedure. Furthermore, pursuant to the Civil Procedure Law and relevant judicial interpretations, once an appraisal institution has rendered an opinion that has been reviewed by the court, examined by the parties, and adopted as the basis for a final judgment, any unilateral request to rescind that opinion—absent statutory grounds and without following the prescribed legal procedures—lacks both factual and legal justification, obstructs the civil litigation process, and must be deemed invalid. Accordingly, the Xigu District People’s Court issued a ruling rejecting Liu’s application for retrial.
In fact, although Chinese law grants parties the right to apply for the revocation of an expert opinion, it does not confer upon the expert institution the unilateral authority to rescind an opinion it has already rendered. Even the Ministry of Justice, as the competent authority for forensic expertise, in its 2007 “General Provisions on Forensic Procedures,” only stipulated sanctions for violations of forensic‑expertise regulations, without authorizing forensic centers to amend or revoke forensic opinions. This is because permitting an expert institution to arbitrarily withdraw an opinion after it has been issued could not only disrupt the orderly conduct of judicial proceedings but also undermine the res judicata effect of final judgments, thereby eroding judicial authority and public confidence in the judiciary. Of course, this does not preclude a party’s right to seek the revocation of an expert opinion; if a party can furnish evidence demonstrating that the expert opinion relied upon in a final judgment falls within any of the circumstances enumerated in Article 27 of the Supreme People’s Court’s “Several Provisions on Evidence in Civil Litigation,” they may still safeguard their legitimate rights and interests by filing a petition for retrial.

Inner Mongolia’s first case involving fraud targeting the elderly has been handed down: the amount of money involved totals 362 million yuan.
On May 16, the Intermediate People’s Court of Ordos City, Inner Mongolia Autonomous Region, publicly pronounced a verdict in accordance with the law in the case involving Ordos Yixiangcheng E‑Commerce Co., Ltd. and defendants including Wang Xiaokai, who were charged with fundraising fraud, illegal acceptance of public deposits, bigamy, and harboring a criminal. This case marks the first elderly‑fraud conviction handed down in Inner Mongolia since the launch of the nationwide special campaign to combat and rectify scams targeting seniors.
The Intermediate People’s Court of Ordos City sentenced the defendant Wang Xiaokai to life imprisonment for the crime of fundraising fraud, with deprivation of political rights for life and confiscation of all personal property; for the crime of bigamy, he was sentenced to two years’ fixed-term imprisonment. Considering all charges together, the court decided to impose a sentence of life imprisonment, with deprivation of political rights for life and confiscation of all personal property. The other defendants were each sentenced to fixed-term imprisonment ranging from two years to three years and three months.
Upon trial, it was ascertained that, between November 2016 and May 2018, the defendant entity, Yixiangcheng Company, and the defendant, Wang Xiaokai, without obtaining approval from the relevant state authorities, engaged in unlawful fundraising by soliciting funds from an indefinite public audience under such pretenses as crowdfunding equity participation, free elderly care, discounted car purchases, and debt resolution, luring investors with promises of high-interest returns and the provision of products and consumer cards.
Yixiangcheng Company raised a total of RMB 362 million from more than 1,600 investors. As of the date of the judgment, it had verified the investment details for 794 investors, conofficeing an aggregate investment amount of over RMB 204 million, thereby causing direct losses of RMB 107 million to the investors. The defendants Wang Moumou, Quan Moumou, Zhang Moumou, Gao Moumou, Wang Mou, and others, in their joint criminal conduct, assisted Wang Xiaokai in carrying out illegal fundraising activities and participated, to varying degrees, in such unlawful fundraising schemes.
The defendant, Wang Xiaokai, paid for media interviews to present himself as a successful entrepreneur and to portray his shell company as a large enterprise with ties to state-owned and central government‑affiliated entities. He fabricated a false narrative of his company’s “prosperity and glory,” creating the illusion that his business model promised “huge profits with minimal investment” and “payback in three months,” thereby engaging in extensive illegal fundraising. Under this web of deception, more than 1,600 victims were defrauded, including some elderly individuals who handed over their life savings, lured by promises of free tours and complimentary gifts. The funds raised were used not only to pay investors interest, returns, and principal but also to purchase luxury vehicles for himself and his mistress, repay personal debts, reimburse relatives’ expenses, and extend loans to family members. Unable to meet his obligations, he absconded overseas in June 2018 and was subsequently apprehended in Macau on December 28, 2018.
The Intermediate People’s Court of Ordos City held that the defendant entity, Yixiangcheng Company, engaged in fundraising by means of fraud with the intent of illegal appropriation, involving an enormous sum, thereby constituting the crime of fundraising fraud. The defendant, Wang Xiaokai, also acted with the intent of illegal appropriation, thus constituting the same crime. His fraudulent fundraising activities severely disrupted the state’s financial management order, inflicted substantial losses on the investors, and posed an extremely grave social hazard; accordingly, in accordance with the law, he was sentenced to life imprisonment.
 

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