JC Master Legal News Issue 1029

Key Takeaways for This Issue

CSRC: Continue to advance the formulation and revision of rules and normative documents supporting the Futures and Derivatives Law.
To ensure the effective implementation of the Futures and Derivatives Law, the China Securities Regulatory Commission issued on August 12 the “Decision on Amending and Repealing Certain Securities and Futures Regulations” and the “Decision on Amending and Repealing Certain Securities and Futures Normative Documents,” deciding to amend certain provisions of eight regulations and fourteen normative documents, and to repeal one regulation and one normative document.
PetroChina, Sinopec, Chinalco, and other companies will collectively delist from U.S. stock markets.
On the evening of August 12, several “China‑named” companies, including PetroChina, Sinopec, China Life Insurance, and Chinalco, announced that they would delist their depositary shares from the New York Stock Exchange.
On the same day, China Petroleum announced that it intends to file Form 25 with the SEC on or around August 29, 2022, to delist its depositary shares from the New York Stock Exchange.
The commercial real estate market is facing five major trends, with investment growth and demand expected to recover month by month.
In the new market landscape, commercial real estate has emerged as a key arena for industry transformation and upgrading, as well as for companies seeking new sources of profit growth, paving the way for a shift toward innovative development models in the next era.
Shanghai: Tax and fee policies precisely provide “blood transfusions and self‑sufficiency” for individual business households.
Recently, Shanghai issued a series of documents introducing 34 measures to help individual business households overcome difficulties, 12 of which are related to the tax authorities. This comprehensive, multi‑pronged package of tax and fee support policies essentially covers all individual business households across the city.

Finance & Capital Markets
CSRC: Continue to advance the formulation and revision of rules and normative documents supporting the Futures and Derivatives Law.
To ensure the effective implementation of the Futures and Derivatives Law, the China Securities Regulatory Commission issued on August 12 the “Decision on Amending and Repealing Certain Securities and Futures Regulations” and the “Decision on Amending and Repealing Certain Securities and Futures Normative Documents,” deciding to amend certain provisions of eight regulations and fourteen normative documents, and to repeal one regulation and one normative document.
The China Securities Regulatory Commission stated that the enactment of the Futures and Derivatives Law is in line with the central government’s decisions and arrangements to improve the fundamental institutional framework of the capital market. Grounded in the goals of serving the real economy, preventing and controlling financial risks, and deepening financial reform, the law adheres to the principles of marketization, rule of law, and internationalization. It comprehensively and systematically establishes the basic institutional framework for both the futures and derivatives markets, providing robust legal safeguards for building a capital market that is standardized, transparent, open, dynamic, and resilient, thereby carrying significant and far-reaching implications.
The China Securities Regulatory Commission attaches great importance to the refinement of the implementing rules and normative documents for the Futures and Derivatives Law. Adhering to the principle of “amending as soon as a set is ready,” it has carried out a systematic, targeted review and cleanup. This round of “package”‑style revision of certain provisions in the relevant rules and normative documents involves making direct, corresponding adjustments to the text and content in accordance with the pertinent provisions of the Futures and Derivatives Law, while repealing those rules and normative documents that have already been subsumed by higher‑level laws or other regulatory frameworks.
 The China Securities Regulatory Commission stated that, as a next step, it will take the implementation of the Futures and Derivatives Law as an opportunity, closely align with the requirements for comprehensively deepening capital market reform, and continue to advance the formulation and revision of supporting regulations and normative documents under the Futures and Derivatives Law.

The China Banking and Insurance Regulatory Commission has issued the “Regulations on the Administration of Insurance Asset Management Companies.”
To further deepen supply-side structural reform in the financial sector, strengthen regulation of insurance asset management companies, and promote high-quality development of the insurance asset management industry, the China Banking and Insurance Regulatory Commission has revised the Interim Provisions on the Administration of Insurance Asset Management Companies (Order No. 2 of 2004 issued by the CIRC), solicited opinions from relevant parties and the general public, and formulated the Regulations on the Administration of Insurance Asset Management Companies (hereinafter referred to as the “Regulations”). These Regulations are hereby officially promulgated and shall take effect as of September 1, 2022.
The Regulations comprise 7 chapters and 85 articles. Their main provisions are as follows: First, a dedicated chapter on corporate governance has been added. Drawing on recent regulatory practice, it sets out clear requirements covering overall principles, shareholder obligations, incentive and restraint mechanisms, the functioning of shareholders’ meetings and the boards of directors and supervisory boards, the establishment of specialized committees, the independent director system, the chief risk management officer, and restrictions on senior executives holding concurrent positions. These measures aim to enhance the independence of insurance asset management companies and comprehensively strengthen institutional safeguards for corporate governance oversight. Second, risk management is now addressed in a separate chapter, with comprehensive additions covering the risk management framework, risk management requirements, internal control and auditing, subsidiary risk management, related-party transaction management, personnel management, risk reserves, and emergency management. These enhancements seek to bolster the risk management capabilities of insurance asset management companies and effectively safeguard the security of long-term funds, including insurance capital. Third, the equity structure has been optimized. In line with the State Council Financial Stability and Development Committee’s decisions to further open up the financial sector, domestic and foreign insurance company shareholders of insurance asset management companies are treated equally, and the cap on foreign ownership has been lifted. Moreover, uniform eligibility criteria have been established for all types of shareholders, while non‑financial corporate shareholders are subject to stringent oversight. Fourth, operating principles and related requirements have been refined. The scope of business activities for insurance asset management companies has been clarified, basic principles governing the trust management of various types of funds have been introduced, the establishment of a custody mechanism is explicitly mandated, and provisions on asset independence and the prohibition of debt offsetting have been strengthened. Conducting conduit‑type business is strictly prohibited, and additional rules have been laid down concerning sales management and prudent operations. Fifth, supplementary regulatory tools and enforcement mechanisms have been introduced. These include tiered supervision, information disclosure, and reporting on material matters, thereby enriching the methods and measures for inspection and oversight. New provisions have also been added, such as maintaining records of violations, assigning liability to professional institutions for breaches, monitoring financial conditions, and strengthening self‑regulatory frameworks.
The Regulations represent an important measure for implementing the CPC Central Committee and the State Council’s directives on deepening supply-side structural reform in the financial sector and expanding opening-up. They comprehensively take into account both the current challenges facing insurance asset management companies and their development trajectory over the coming period, thereby establishing a relatively comprehensive institutional regulatory framework with more distinctive features. This framework creates room for market‑oriented operations and differentiated development among insurance asset management offices, helping to guide and promote their standardized management and high‑quality growth. It also better addresses the needs of long-term capital, such as insurance funds, for preserving and enhancing value, while fostering a larger base of stable, prudent institutional investors to support the steady and sound functioning of the capital markets and the high‑quality development of the real economy.

Optimize and adjust the trading calendar for Stock Connect programs, and further refine the mechanisms linking the mainland and Hong Kong stock markets.
Today, the China Securities Regulatory Commission and the Securities and Futures Commission of Hong Kong issued a joint announcement, giving preliminary approval for the Shanghai Stock Exchange, the Shenzhen Stock Exchange, the Stock Exchange of Hong Kong Limited, China Securities Depository & Clearing Corporation Limited, and Hong Kong Central Clearing Limited to implement an optimized trading calendar for the Shanghai–Shenzhen–Hong Kong Stock Connect. This enhancement increases the number of tradable days for investors, better ensures the continuity of trading, and helps deepen the interconnection between the capital markets of the two regions.
Due to differences in holiday schedules and settlement mechanisms between the two markets, Stock Connect currently only operates on trading days when both markets are open and settlement arrangements can be met. Following this optimization, Stock Connect will be fully operational on all trading days when both markets are open; however, trading and settlement activities on newly added trading days will continue to comply with the regulatory requirements and business rules of the respective settlement jurisdictions. In cases where one market is closed for a holiday while the other remains open, the existing Stock Connect arrangements will apply, and trading will not be permitted.
At present, the Shanghai Stock Exchange is, in accordance with the unified deployment of the China Securities Regulatory Commission, working jointly with relevant parties to carry out the business and technical preparations for optimizing the trading calendar, ensuring its implementation within the timeframe stipulated in the Joint Announcement. Throughout, the SSE has remained steadfast in upholding the opening-up of the capital market and in supporting the development of Shanghai as an international financial center. Under the new circumstances, the SSE will maintain its resolve, continue to refine and enhance the mutual market access mechanisms, steadily improve the inclusiveness and adaptability of its institutional framework, further promote the two-way opening-up and sound development of the capital markets on both sides, bolster Hong Kong’s status as an international financial center, forge a new pattern of high‑level opening-up in the capital market, and facilitate the dual circulation of the domestic and international economies.

Commercial & Corporate

PetroChina, Sinopec, Chinalco, and other companies will collectively delist from U.S. stock markets.
On the evening of August 12, several “China‑listed” companies, including PetroChina, Sinopec, China Life Insurance, and Chinalco, announced that they would delist their depositary shares from the New York Stock Exchange. On the same day, PetroChina stated that it plans to file Form 25 with the SEC on or around August 29, 2022, to delist its depositary shares from the NYSE.
Sinopec announced that it plans to file a Form 25 with the U.S. Securities and Exchange Commission on or around August 29, 2022, to delist its depositary shares from the New York Stock Exchange.
China Life Insurance announced that it has applied to voluntarily delist its depositary shares from the New York Stock Exchange and to revoke the registration of such depositary shares and their corresponding H shares under the Securities Exchange Act. The last trading date for the depositary shares on the NYSE is expected to be September 1, 2022, or thereafter.
China Aluminum Corporation announced its intention to delist its American Depositary Shares from the New York Stock Exchange, withdraw its registration under the U.S. Securities Exchange Act, and terminate its disclosure obligations.
Shanghai Petrochemical Co., Ltd. announced on the Hong Kong Stock Exchange that it plans to delist its American Depositary Shares from the New York Stock Exchange. According to a notice posted on the website of the China Securities Regulatory Commission (CSRC) on August 12, a spokesperson from the relevant CSRC department stated in response to reporters’ questions that both listing and delisting are standard practices in capital markets. Based on information disclosed in the companies’ public announcements, these enterprises have consistently complied with U.S. capital market rules and regulatory requirements since their U.S. listings, and their decision to delist stems from their own commercial considerations. These companies are listed in multiple jurisdictions, with only a small portion of their securities outstanding in the U.S.; therefore, the current delisting plans will not impede their ability to continue raising capital and pursuing growth through both domestic and international capital markets.
The China Securities Regulatory Commission stated that it respects companies’ decisions made in light of their specific circumstances and in compliance with the listing rules of the relevant overseas jurisdictions, and will maintain communication with the relevant overseas regulatory authorities to jointly safeguard the legitimate rights and interests of both enterprises and investors.

The Top 100 Listed Companies ranking was unveiled in Shanghai, with the number of real estate offices on the list down by 60% from its peak.
On August 10, the Wharton Economic Institute released the “2022 Top 100 Chinese Listed Companies Ranking” in Shanghai, with a total of 500 listed companies making the list.
Industrial and Commercial Bank of China, COSCO Shipping Holdings, China State Construction Engineering Corporation, and others rank among the top ten. ICBC’s total profits exceeded RMB 400 billion, securing the No. 1 spot for the thirteenth consecutive year, while the “Big Four” banks have officely held the top four positions for six years running. COSCO Shipping Holdings entered the top ten for the first time, marking the return of four real‑economy enterprises to the top ten after a decade.
Among the Fortune Global 500, 105 companies reported total profits exceeding RMB 10 billion, 21 exceeded RMB 50 billion, and 10 surpassed RMB 100 billion, with leading offices demonstrating robust growth momentum.
This year, the minimum threshold for inclusion in the Top 500 was a total profit of RMB 1.67 billion for the 2021 fiscal year, a substantial year-on-year increase of 21.60%. Betray, the only company listed on the Beijing Stock Exchange to make the ranking, secured the 500th position.
The combined profits of the Fortune 500 companies, after surpassing RMB 5 trillion for the first time last year, have now reached a new milestone of RMB 6.132246 trillion this year, up 20.85%—the fastest growth rate on record. These profits account for 93.66% of all listed companies on the Shanghai, Shenzhen, and Beijing stock exchanges, and their share of China’s GDP has exceeded 5% for the first time, standing at 5.36%. The Fortune 500 offices thus occupy a pivotal position in the Chinese economy.
The Top 500 companies reported operating revenue of RMB 46,529.034 billion, up 18.72%; total assets of RMB 31,078.7807 billion, up 8.30%; and a combined market capitalization of RMB 54,646.874 billion, up 3.30%. Their shares of the total operating revenue, total assets, and total market capitalization of all listed companies on the Shanghai, Shenzhen, and Beijing stock exchanges stood at 71.53%, 89.78%, and 56.65%, respectively. Moreover, their operating revenue and market capitalization as a percentage of China’s GDP reached 40.68% and 47.78%, respectively, underscoring the continued strengthening of their role as the main driving force of economic development.
It is worth noting that this year only 22 real estate companies made the list, a 60% decline from the peak of 55. With the exception of Binjiang Group and Pudong Jinqiao, which both moved up in the rankings, all other listed developers saw their positions drop significantly compared with the previous year.

The commercial real estate market is facing five major trends, with investment growth and demand expected to recover month by month.
“Overall, the commercial real estate market continues to face a situation characterized by weak fundamentals and strong expectations,” said Liu Kai, Deputy Secretary-General of the All-China Federation of Industry and Commerce Real Estate Chamber and Chairman of Fangxun.com, at the recently held Fourth China Commercial Real Estate Brand Building Forum and the “2022 China Commercial Real Estate Investment Professional Exhibition.” He added that, with the easing of domestic COVID‑19 conditions and declining uncertainty, coupled with the gradual implementation of policies aimed at stabilizing the real estate market, both investment growth and demand growth in commercial real estate are expected to recover month by month in the second half of the year.
Judging from the current performance of the commercial real estate market, we have entered a new phase. Under the evolving market conditions, commercial real estate has emerged as a key arena for industry transformation and upgrading, as well as for companies seeking new sources of profit growth, paving the way for a shift toward a new development model in the next era. In light of this, at the aforementioned forum, numerous industry experts offered their insights and recommendations.
IPG China’s Chief Economist, Bai Wenxi, believes that in the era of stock‑based real estate, the industry is undergoing M&A‑driven consolidation, with sectoral division of labor becoming increasingly specialized and refined, thereby boosting the value of commercial office properties and enhancing overall industry efficiency. At the same time, asset securitization and quasi‑asset securitization are set to accelerate, improving liquidity for commercial office assets and providing crucial support for their value appreciation.
Guo Yinghui, Chairman of Zhongke Industrial City, outlined the development opportunities for industrial parks in the post‑pandemic era from the perspective of light‑asset operations. He noted that factors such as property supply, property sales, investment returns, and industry regulation have collectively contributed to a downturn in traditional industrial real estate development, giving rise to the widespread adoption of light‑asset models. Guided by an asset‑management approach, Zhongke Industrial City has forged a “value community” with industrial investors through a GP+LP structure. Leveraging its “12586” park investment and operation framework, the company aggregates key development resources, cultivates a robust industrial ecosystem, and supports high‑quality regional development driven by the integration of industry and urbanization across China.
Miao Silu, Deputy General Manager of the Xibeiwang United Association, stated that collective‑land industrial parks possess distinct competitive advantages: first, land costs are relatively low; second, a variety of cooperative models can be adopted to explore innovative approaches; third, collective economic organizations have deep local roots, giving them an inherent advantage in navigating preliminary administrative procedures; and fourth, they place greater emphasis on the long‑term returns from park investment promotion and operations, aligning with today’s development philosophy of low turnover, meticulous management, and high quality.
“The pandemic control measures in the first half of the year slowed the pace of economic recovery. However, as the macroeconomy stabilizes and rebounds, this will help underpin a recovery in office‑space demand. Since May, leasing sentiment has picked up in tandem with the easing of the epidemic, and we expect demand to gradually recover over the course of the year,” said Yan Quhai, Managing Director of Colliers China’s Office Services Group. Looking ahead at the development of the office market, Mr. Yan believes that the pandemic’s impact is short‑term and temporary, and that the market’s medium‑ to long‑term trajectory will ultimately hinge on the fundamental interplay between supply and demand.
It is worth noting that the forum also unveiled the “2022 China Top 100 Commercial Real Estate Research Report” and related industry rankings. This assessment, conducted under the auspices of Fangxun Index, has been carried out for four consecutive years, and its findings have become a key benchmark for evaluating the overall strength and industry standing of commercial real estate developers and operators.
In this regard, Liu Kai, Chief Researcher at the Fangxun Index, points out that the new era of commercial real estate is one in which products, quality, and operations reign supreme. This new era is shaped by five key trends: first, a shift from an era of incremental growth to one of existing‑asset optimization; second, a move from heavy‑handed development to intensive asset management; third, a transition from asset appreciation to comprehensive asset management; fourth, a pivot from scale‑driven expansion to profit‑oriented performance; and fifth, a transformation from coarse‑grained operations to precision‑focused management.

Seven A-shares have been newly included in the MSCI China Index, five of which are closely tied to the new energy sector.
On August 12, Beijing time, MSCI, the international index provider, announced the results of its August quarterly index review.
In this adjustment, the MSCI China Index added seven new constituents, all of which are A‑share stocks: Tong Ren Tang, China Merchants Steamship, Pylontech, Yanhua Potash, Tianqi Lithium, Yuntianhua, and Zangge Mining. In addition, the index removed two Hong Kong‑listed stocks—Sunac Services and Longfor Group. The MSCI quarterly index rebalancing will take effect after the market closes on August 31.
From a market performance perspective, as of the close on August 12, among the seven newly added individual stocks mentioned above, China Merchants Steamship posted the largest gain, rising 4.14%, while Zangge Mining and Yanhua Potash fell 0.33% and 0.28%, respectively. Meanwhile, four other stocks—Tongrentang, Yuntianhua, Tianqi Lithium, and Pylontech—experienced varying degrees of decline.
“The adjustment of constituent stocks primarily hinges on two factors: first, industry characteristics—whether the sector in which a stock operates boasts substantial growth potential; and second, market capitalization—industry leaders, owing to their larger size, are more likely to be included as constituents,” said Qin Hong, a senior analyst at Jin Bailin Consulting, in an interview with Securities Daily.
Chen Li, Chief Economist and Director of the Research Institute at Chuan Cai Securities, told a reporter from the Securities Daily that most of the newly listed companies this time have posted rapid profit growth and demonstrate strong profitability, with MSCI’s adjustments tending to favor offices with solid fundamentals. Furthermore, among the seven stocks, five are closely tied to the new‑energy sector, four of which are upstream players. The primary reason is that China’s new‑energy industry has expanded rapidly in recent years, maintaining robust market conditions; as a result, the listed companies involved have gradually established technological barriers and scale advantages, leading to overall rapid growth in both revenue and net profit.
In terms of performance, according to data from Tonghuashun, as of 9:00 p.m. on August 12, Zangge Mining was the first company to release its interim report, reporting a 438.01% year-on-year increase in net profit attributable to shareholders for the first half of the year. Meanwhile, China Merchants Steamship, Yanhua Potash, Tianqi Lithium, and Yuntianhua have all issued positive earnings forecasts for the first half of this year.
Looking back, as the A-share market has grown and matured, international capital markets have increasingly recognized its significance. On June 1, 2018, A-shares were officially included in the MSCI indices, an event that the market succinctly dubbed “A‑shares’ inclusion in MSCI.” This marked a major milestone in the internationalization of the A‑share market. On June 21, 2019, A‑shares were added to the FTSE Russell Global Index; and in the early hours of September 8, 2019, S&P Dow Jones Indices formally announced the inclusion of A‑shares in its indexes. With this, all three major global index providers—MSCI, FTSE Russell, and S&P Dow Jones Indices—now include A‑shares, underscoring the international investment community’s support for and confidence in China’s long-term economic prospects and the ongoing reform and opening-up of its capital markets.
The MSCI China Index covers A-shares, H-shares, B-shares, red-chip stocks, and private‑enterprise shares. The MSCI officially rebalances the index’s constituent stocks around the middle of each quarter—typically mid-February, mid-May, mid-August, and mid-November—and such adjustments often prompt a surge in foreign capital inflows.
In recent years, northbound capital has continued to flow into the A-share market. Net inflows from northbound investors totaled RMB 294.218 billion in 2018, RMB 351.743 billion in 2019, RMB 208.932 billion in 2020, and RMB 432.169 billion in 2021, bringing the cumulative net inflow over the past four years to RMB 1,287.062 billion. Notably, on August 11, northbound funds surged into the A-share market, with net purchases reaching RMB 13.295 billion for the day—marking a nearly two-month high. Year-to-date, as of August 11, total net inflows from northbound investors stood at RMB 53.268 billion.
 
Taxation
Tax policies deliver targeted, precision‑driven support to foster distinctive, wealth‑creating industries in rural areas.
On July 25, the 2022 Yanling Yellow Peach Festival was held in Yanling County, Hunan Province, drawing distributors and tourists from across the country to savor, pick, and purchase yellow peaches, all while experiencing the vibrant atmosphere of a bountiful harvest.
Yanling County in Hunan Province boasts more than 30 years of yellow peach cultivation, and the yellow peach industry has become a key pillar of local economic development for mountain communities. According to reports, the region has actively adopted a new production and management model—“cooperative + base + farmer”—to standardize planting practices, boost yields, and effectively address the challenges posed by small-scale, fragmented farming and weak market competitiveness.
To fully leverage the strengths of agricultural cooperatives and boost the yield of Yanling yellow peaches, the Yanling County Tax Service Bureau of the State Taxation Administration has adopted a categorized management and service model, taking into account the large number, wide geographic distribution, and varying scales of these cooperatives. The bureau has tailored tax‑benefit guidance materials for each cooperative, ensuring that they are fully informed of and can fully enjoy all applicable policy incentives. With this policy support, in 2022, nearly 2,000 companies and specialized cooperatives in Yanling County were engaged in the yellow peach industry, with a planting area of 96,000 mu and an estimated output of 78,000 tons—up 20% from the previous year.
Industrial revitalization is the top priority of rural revitalization. Current tax policies, aligned with the overarching goal of high-quality development of rural industries, further refine support measures and strengthen assistance. They have introduced a series of preferential policies to optimize land‑resource allocation, boost agricultural production, encourage the growth of new types of business entities, facilitate the circulation of agricultural products, and promote the comprehensive utilization of agricultural resources. These efforts mark a shift from “blood‑transfusion”‑style poverty alleviation to “hematopoiesis”‑driven industrial development, thereby ensuring an effective link between consolidating and expanding poverty‑alleviation achievements and advancing rural revitalization.
With the support of favorable tax policies, regionally tailored, distinctive industries that boost rural incomes are taking root, and a vibrant picture of rural revitalization is steadily unfolding across China.
Kedong County is located in the central‑northern part of Heilongjiang Province, northeast of Qiqihar. The county administers 5 towns, 2 townships, and 10 agricultural and forestry farms, encompassing 98 administrative villages. Its total population stands at 274,000, of whom 216,000 are engaged in agriculture. From being designated a provincial key county for poverty alleviation and development in 2001 to the end of 2019, when all remaining impoverished residents had been lifted out of poverty, Kedong County successfully completed its poverty‑eradication efforts with high quality.
Strengthening the foundation for poverty alleviation and accelerating rural revitalization, developing industries has become a key strategy for Kedong County. To better support the growth of regionally distinctive rural industries, the Kedong County Tax Service Bureau of the State Taxation Administration leverages the advantages of tax policies to boost poverty‑alleviation initiatives, encouraging villagers to innovate and start businesses on the county’s fertile black soil. Local tax authorities have further extended their tax services to agriculture, rural areas, and farmers, implementing targeted measures and optimizing service delivery. By offering tax reductions and exemptions, streamlining procedures, enabling online processing, and providing appointment‑based services, they help agricultural enterprises overcome difficulties, bolster their confidence, and galvanize their efforts to expand and strengthen their operations—ensuring that agriculture truly becomes a promising, wealth‑creating sector.
In Gongbo’gyamda County, Nyingchi City, Tibet Autonomous Region, at an average elevation of 3,600 meters, the jet-black Tibetan pigs are like “black pearls” scattered across the landscapes of southeastern Tibet. Leveraging this advantageous, leading industry, Gongbo’gyamda County began planning and constructing a Tibetan Pig Industrial Park in 2018, aiming to drive the sector toward greater specialization, scale, clustering, and modernization.
To consolidate and expand the achievements of poverty alleviation while ensuring a seamless transition to rural revitalization, and to support the development of agriculture, rural areas, and farmers, the Gongbo’gyamda Taxation Bureau of the State Taxation Administration has leveraged its tax‑related expertise through policy support and targeted services, thereby contributing effectively to rural revitalization.
The head of a food company within the industrial park stated that, due to equipment purchases and land leases, the company’s costs have risen sharply. Fortunately, supportive national policies have significantly eased its financial strain. In April 2022 alone, the company received a tax rebate of RMB 342,013.05, providing crucial funding to further upgrade the supporting infrastructure for the Tibetan pig industry and to build a comprehensive development chain for this sector.
During this year’s spring plowing season, staff from the Chabu District Tax Service Bureau of the State Taxation Administration visited an agricultural group based in Zhangjiakou City, Hebei Province, to promote and provide guidance on tax preferential policies, assess the enterprise’s tax-related needs, and help it conduct a precise analysis of applicable measures, ensuring that tax benefits are delivered promptly and fully realized.
This potato‑industry‑wide group, with potato seed production at its core, modern agricultural services as an extension, and food processing as its driving force, is a national high‑tech enterprise. The Chabu District Tax Bureau has implemented the preferential policy of additional deduction for R&D expenses, helping the company fully benefit from this policy and supporting its innovation‑driven development. According to reports, since its establishment, the company has cumulatively benefited from R&D expense deductions totaling RMB 11.0769 million.
Wang Yuan, the company’s chief financial officer, stated that the policy of allowing an additional tax deduction for R&D expenses has eased the company’s cash-flow constraints, enabling it to allocate more funds to the development of new product varieties and helping more farmers escape poverty and achieve prosperity.

Shanghai: Tax and fee policies precisely provide “blood transfusions and self‑sufficiency” for individual business households.
As the “capillaries” of the market economy, individual business households play a vital role in invigorating markets, boosting employment, and improving people’s livelihoods. Recently, Shanghai issued relevant documents introducing 34 measures to help these businesses overcome difficulties, 12 of which are directly related to the tax authorities. A comprehensive, multi‑pronged package of tax and fee support policies now covers virtually all individual business households across the city.
Precision Services: Refund of Overpaid Taxes Helps Individual Business Operators Overcome Difficulties
Cui Lian Food Business Department in Minhang District, Shanghai, primarily engages in food supply, mainly providing frozen meat products to the canteens within Hongqiao Airport.
“This year, business has been particularly challenging. Intense market competition, compounded by the pandemic, has placed significant pressure on our small-scale, sole‑proprietor operation, making cash flow a major concern,” said Yang Cuilian, head of the Cuilian Food Business Department. “After receiving a policy‑guidance call from the tax authorities, I promptly requested a reassessment of our tax credit rating, met the eligibility criteria for a VAT credit refund, and successfully obtained the refund.”
To ensure that all eligible taxpayers fully benefit from the value-added tax credit refund, without leaving a single business behind, the competent tax authorities leveraged big data analytics during the 2021 taxpayer credit assessment period to conduct a meticulous, case-by-case review of individual businesses meeting the basic eligibility criteria. They accelerated the “policy‑to‑people” initiative, promptly providing guidance and follow-up to those who may qualify, thereby delivering policy benefits swiftly and precisely to the small and micro entities that need them most, and injecting much‑needed fiscal support into the small‑business economy.
“The tax authorities’ attentive, end-to-end support has been truly encouraging. From policy guidance to procedural steps, they’ve provided step-by-step assistance—something that means a great deal to us individual business owners. As long as our cash flow remains steady, there’s always room to maneuver,” said Yang Cuilian.
Tax cuts take effect; preferential policies ensure stable employment for individual business households.
Since the beginning of this year, in order to ensure the thorough and precise implementation of the package of tax and fee support policies, Shanghai’s tax authorities have accelerated policy guidance, providing much-needed assistance to individual business households to help them overcome difficulties.
“We’re small-scale merchants running a modest business. We’ve been operating for quite some time, but this year we’ve been hit hardest by the pandemic,” said Zhang Shiming, head of Xinxin Hardware Repair and Processing Shop in Shanghai’s Yangpu District. “Since resuming work and production, the tax authorities’ preferential policies for individual businesses have significantly reduced our tax burden. Thanks to these measures, we were able to hold on to our little corner of the market during the epidemic—and safeguard the livelihoods of our employees as well.”
Located on the North Wing Commercial Street of the Small Commodity Market, Shanghai Baoshan District’s Xiumiao Computer Accessories Store has also benefited this year from a series of tax‑preferential policies.
“We thought we wouldn’t make it through this year, but recently we received a call from the tax authorities informing us that we could benefit from preferential policies—truly, that gave us hope!” said Duan Chuanqi, the store’s manager. “We’re a small business; during this special period, we’ve been unable to operate, and our fixed costs have been a significant burden. Thanks to the tax authorities’ support, we’ve managed to keep our little shop afloat. I’m confident that each year will be better than the last!”
An official from the Shanghai Municipal Tax Service of the State Taxation Administration stated that the tax authorities will, through more concrete measures, superior services, and greater efficiency, fully implement and refine tax and fee preferential policies supporting individual business households, continuously providing them with both financial support and capacity‑building, thereby fully fostering and unleashing the vitality and creativity of small and micro market entities.

The Jiangsu Provincial Tax Authority has, in accordance with the law, investigated and prosecuted a case involving a group that issued false invoices to fraudulently obtain additional tax credit refunds through intermediary companies.
Recently, the Inspection Bureau of the Jiangsu Provincial Tax Service, based on leads derived from tax‑related big data analysis, guided the Yancheng Municipal Tax Inspection Bureau and, in collaboration with the public security economic investigation authorities, lawfully investigated and cracked a case involving a group that fraudulently obtained VAT credit refunds by using intermediary companies to issue false invoices.
Upon investigation, the gang exploited the services of a certain intermediary accounting office—taking advantage of its bookkeeping and invoice‑issuing代办 capabilities—to issue false value-added tax invoices to external parties through multiple shell companies, despite the absence of any genuine transactions. The Inspection Bureau of the Yancheng Municipal Tax Service has conofficeed that downstream recipient enterprises within the gang fraudulently obtained 205,300 yuan in additional tax credit refunds. Authorities are currently conducting thorough investigations into other entities suspected of using falsely issued invoices to illicitly claim such refunds. At present, the public security economic investigation department has apprehended 10 suspects.
An official from the Inspection Bureau of the Jiangsu Provincial Tax Service stated that, in the next phase, they will earnestly implement the spirit of the joint meeting convened by six departments—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—on advancing efforts to combat fraudulently obtained VAT credit refunds. They will further leverage the inter‑departmental joint‑action mechanism, making the crackdown on such fraud a top priority in ongoing routine enforcement. Focusing on organized, cross‑regional schemes involving the fraudulent issuance of invoices and the false reporting of input tax credits to obtain refunds, they will adopt a zero‑tolerance approach to resolutely suppress these illegal and criminal activities, thereby establishing an overwhelming deterrent against refund fraud and ensuring the effective and accurate implementation of the VAT credit refund policy.
Litigation & Arbitration
The 2021–2022 Annual Conference of the Bankruptcy Law Research Association of the Jiangsu Provincial Law Society was held in Liyang, Jiangsu.
On August 6, the Jiangsu Provincial Law Society’s Bankruptcy Law Research Association held its 2021–2022 annual conference in Liyang, Jiangsu. The conference was themed “Revision of the Enterprise Bankruptcy Law and Coordinated Development of Corporate Bankruptcy Resolution in the Context of Yangtze River Delta Integration.” Du Wanhua, Deputy Director and Secretary-General of the Advisory Committee of the Supreme People’s Court, attended the meeting and delivered a keynote address. Zhou Jiyue, Vice Chairman of the Provincial Political Consultative Conference and President of the Jiangsu Provincial Law Society, and Xia Daohu, Secretary of the Party Group and President of the Provincial Higher People’s Court, also attended and addressed the gathering.
Du Wan-hua delivered a keynote address on “Advancing the Improvement of China’s Bankruptcy Legal System,” offering four recommendations for revising the Enterprise Bankruptcy Law: first, further refine the law’s core institutional framework; second, accord high priority to and accelerate the development of mechanisms for rescuing market entities; third, introduce a personal bankruptcy regime; and fourth, incorporate into the Enterprise Bankruptcy Law the successful practices—such as pre-reorganization and reorganization‑related information disclosure—that have emerged from recent efforts to advance bankruptcy rule of law. With regard to enhancing the ancillary systems supporting the bankruptcy law, he put forward three proposals: first, improve the bankruptcy administrator system; second, establish a coordinated, government‑court linkage mechanism for enterprise bankruptcy proceedings; and third, set up a coordination mechanism between enforcement and bankruptcy procedures. In addition, he recommended strengthening theoretical research on bankruptcy and publicizing the principles of bankruptcy rule of law, thereby providing robust theoretical underpinnings and fostering an intellectual and cultural climate conducive to the reform of the Enterprise Bankruptcy Law.
In his address, Zhou Jiyue set forth key requirements for the work of the research association: elevate political awareness, officely uphold the correct political direction, deeply appreciate the decisive significance of the “two establishments,” strengthen ideological and theoretical education, safeguard the ideological front, and effectively guide public thought. He emphasized the need to deepen theoretical research, serve the overall national agenda, and continue to advance both legislative studies on bankruptcy and the practical application of bankruptcy law, while actively promoting market‑oriented, rule‑of‑law principles in bankruptcy proceedings. Furthermore, he called for bolstering internal capacity and consolidating the foundation for sustained development, vigorously advancing the building of the association’s Party organization, and seizing the opportunity presented by the establishment of the Supreme People’s Court’s Second Civil Division Bankruptcy Trial Research Center (Nanjing) as a research base to foster the deep integration of bankruptcy‑law theory with bankruptcy‑trial practice. Finally, he underscored the importance of cultivating a strong pool of talent in bankruptcy‑related legal fields, enabling more outstanding young legal professionals to emerge and excel.
In his address, Xia Daohu emphasized that effectively conducting bankruptcy adjudication is of great significance for safeguarding social stability, upholding financial security, and promoting economic development. Courts across the province will earnestly implement the important instructions of General Secretary Xi Jinping on the business environment, officely strengthen their sense of responsibility and mission in carrying out bankruptcy adjudication, actively participate in initiatives to optimize the business climate, continuously deepen coordination and collaboration between government and courts, further reinforce team building, and comprehensively launch pilot programs for “quasi‑individual bankruptcy.” By doing so, they will better leverage the functions of bankruptcy adjudication, maximize the value of the reorganization system, and, with higher standards and stricter requirements, write a new chapter in serving and supporting economic and social development.
Li Yusheng, Vice President of the Provincial Higher People’s Court and President of the Research Association, Jin Biao, a full-time member of the Judicial Committee of the Provincial Higher People’s Court, along with responsible officials from the Changzhou Intermediate People’s Court, the Liyang Municipal Party Committee, and the Provincial Bankruptcy Administrators Association, as well as representatives from universities, courts, and the bankruptcy administrator system across the province, and selected authors of outstanding papers, attended the meeting. The annual conference also invited responsible officials from the Beijing Bankruptcy Law Society and the Bankruptcy Law Research Association of the Shanghai Law Society to participate. Relevant officials from the pertinent departments of the Provincial Law Society were present to provide guidance.

Yixing’s “Judges + Workstations” Strengthen the Foundations of Grassroots Social Governance
Under the framework of regularized epidemic prevention and control, what new changes have emerged in how courts support grassroots social governance? Recently, the People’s Court of Yixing City, Jiangsu Province, launched a cloud‑based “micro‑classroom” through its “Judge + Workstation” initiative. Wu Minhao, deputy chief judge of the Guanlin Tribunal, delivered an engaging legal education session titled “Standardizing Commercial Transactions and Mitigating Business Risks,” using video conferencing to reach more than 100 supply‑and‑marketing managers from Yixing cable enterprises scattered across 20 provinces and municipalities nationwide.
“All the materials in the courseware are drawn from real‑world cases involving cable companies in the town, serving both to explain the law through specific examples and to highlight potential legal risks. We also answered questions raised on the spot via video, and after the session, we collected more than 20 additional queries—each of which I addressed individually by connecting live.” Wu Minhao said that while pandemic restrictions prevent large‑scale in‑person lectures, this “micro‑classroom” format is highly practical and well received.
Recently, during an interview at the Yixing People’s Court, reporters learned that, by proactively developing the “Judge+” digital platform, the court has integrated a wide array of online and offline resources for smart‑court initiatives. It has subsequently upgraded and established nine core modules—Micro‑Dispute Resolution, Micro‑Guidance, Micro‑Filing, Micro‑Court Hearings, Micro‑Live Streaming, Micro‑Classrooms, Micro‑Regulations, Micro‑Judges, and Micro‑Enforcement—creating a new service model that brings together end-to-end judicial services, including consultation, mediation, case filing, trial proceedings, and enforcement. This approach delivers a comprehensive, efficient, and convenient litigation experience to the public.
The Yixing People’s Court has integrated offline platform development with online and mobile litigation services through its “Judge + Workstation” model. This initiative has now been fully rolled out across 18 towns and subdistricts and has expanded to industry associations in sectors such as wire and cable, finance, and insurance. By establishing a presence in community service centers, the court enables parties to access its micro‑services conveniently nearby, while also bolstering grassroots organizations with professional mediation resources led by judges.
At the Fengyin Community in Yicheng Subdistrict, Yixing City, reporters observed that the “Judge + Workstation” initiative, in collaboration with the community’s “Xu Jiaqian Mediation Studio,” had officially launched at the community service center. Jiang Lijun, Chief Judge of the Yixing Economic Development Zone People’s Court, has been assigned to provide services to this community in his capacity as a “grid‑based judge.” According to community staff, for particularly difficult and complex disputes—especially those involving specialized legal issues—users can simply tap the “Micro‑Dispute Resolution” module on a display screen, follow the prompts to submit a mediation application, and schedule a mediation session. Both parties can then participate in online video mediation via computer or mobile device, with the judge present to oversee and facilitate the process.
Moreover, community workers, including people’s mediators, can use the “WeLive” module to virtually observe live court hearings of landmark cases from courts across the country, providing a convenient and practical new platform for enhancing the rule-of-law awareness of grassroots cadres. “Courts have proactively extended their judicial functions and actively engaged in supporting grassroots social governance, effectively narrowing the temporal and spatial gap between judicial work and grid-based governance, enabling face-to-face interactions between the public and judges, and enriching the array of methods for resolving grassroots conflicts and disputes,” commented Shen Xiaohong, Deputy Secretary of the Yixing Municipal Party Committee and Secretary of the Political and Legal Affairs Commission.
Through “a single network cable and a single screen,” the judicial resources of grassroots social conflict‑resolution centers have been effectively integrated. People’s courts, leveraging the smart court system, have refined an online–offline one‑stop dispute‑resolution mechanism, enhancing the convenience, accessibility, and efficiency of litigation services. Judicial offices and legal service agencies have addressed the challenge of providing professional mediation for disputes. Meanwhile, grassroots trade unions, women’s federations, labor departments, civil affairs agencies, market regulators, land administration authorities, and other relevant bodies, relying on “judge‑plus workstations” established at the subdistrict and town levels, have resolved the need for precise legal interpretation in response to sudden, major, or mass‑scale conflicts.
The Yixing People’s Court, through its “Judge + Workstation” model, has strengthened the foundations of grassroots governance and enhanced the quality and efficiency of judicial proceedings. From January to June this year, the court accepted 16,610 cases and concluded 12,612, with key performance indicators—including the rate of case closure within the statutory time limit, the first-instance compliance and dispute‑resolution rate, the mediation‑and‑withdrawal rate in civil cases, the rate of reversals or remands in first‑instance judgments, and the average caseload per judge—ranking among the top among Wuxi’s primary-level courts. The court also secured the highest overall score among Wuxi’s grassroots courts, earning the title of “Wuxi Court of Excellence in Judicial Quality and Efficiency” for the second consecutive year.

Beijing courts have released the results of the Business Environment Reform Version 5.0: in the first half of this year, online case filings accounted for 80% of all first-instance civil and commercial cases filed during the same period.
On the morning of August 11, the Beijing Higher People’s Court held a press conference on the outcomes of the Business Environment Reform Version 5.0, unveiling the capital’s courts’ vision for a rule-of-law‑based business environment, along with innovative measures and notable achievements.
In the framework of its Version 5.0 reform, the Beijing courts have focused on addressing the “small issues” that concern the public, delivering targeted measures to reduce costs and enhance quality and efficiency. Pioneering nationwide, they issued a joint notice stipulating that, effective September 1, 2022, all city‑wide courts will levy a case‑filing fee of RMB 10 per case for matters subject to the small‑claims procedure. For cases concluded through mediation or upon a party’s withdrawal, the fee is waived entirely. In addition, the courts promulgated the Interim Provisions on the Collection and Refund of Court Fees, ensuring strict implementation of refund policies for successful parties. Furthermore, they launched the nation’s first integrated platform for diversified dispute resolution in financial cases, while strengthening the development of the Beijing International Commercial Court and the Beijing Courts’ One‑Stop Center for Diversified Dispute Resolution in International Commercial Matters. An online system for the disbursement of execution funds has also been put into operation, guaranteeing that eligible execution funds are disbursed within 20 days of receipt by the court, thereby ensuring that the rights of winning parties are promptly realized.
In the realm of smart court development, data show that in 2021, courts across the city accepted 398,000 cases through online filing, a year-on-year increase of 57.3%. In the first half of this year, online filings accounted for 82.9% of all first-instance civil and commercial cases filed during the same period. Meanwhile, the city has taken the lead nationwide in launching an “online inquiry service for real estate registration information via electronic attorney investigation orders,” thereby facilitating lawyers’ access to relevant data. Additionally, it has established an online verification channel linking court judgments with government agencies such as real estate registration authorities, enabling parties to handle government services based on legally effective court documents.
　It is understood that, in order to provide robust support for the rescue of distressed enterprises, Beijing’s courts have taken the lead in issuing regulatory guidelines on pre‑reorganization, thereby facilitating the orderly coordination between out‑of‑court debt restructuring and formal reorganization proceedings. Additionally, they have pioneered expedited reorganization procedures for small and micro‑enterprises, successfully rescuing 34 SMEs facing financial distress.

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