JC Master Legal News Issue 1047

Key Takeaways for This Issue

CICC’s Jin Zhong on the strategic realignment and upgrading of investment banking: Empowering emerging industries and growing together with small and medium-sized enterprises.
Since 2022, the global equity‑financing market has lost its former vibrancy, yet China’s market continues to stand out. The global investment‑banking landscape has undergone profound shifts, with China’s investment‑banking sector deepening and its ecosystem undergoing unprecedented transformation. In this era of sweeping change, how to keep pace with evolving trends and better serve national strategies, the real economy, and investors has become a central concern for the market.
Heji has taken up the challenge of a “14th Five-Year Plan” project, leading the development of a new generation of infant formula.
On December 22, at the China Feihe 60th Anniversary Strategic Upgrade Launch Event—titled “Brewing Active Nutrition, Better Suited to Chinese Babies’ Physiological Needs”—Feihe announced that its lead‑initiated project, “Research and Demonstration of Next‑Generation Infant Formula Manufacturing Technology Based on Chinese Breast Milk Studies,” had been successfully approved.
Overview of Dazhou Tax Authorities’ Efforts to Build “Fengqiao‑Style” Tax Sub‑Bureaus
On February 21, several “Fengqiao‑style” tax sub‑bureaus in Dazhou City were officially inaugurated. The First Tax Sub‑Bureau of the Tongchuan District Tax Bureau, the Shiqiao Tax Sub‑Bureau of the Dachuan District Tax Bureau, the First Tax Sub‑Bureau of the Qu County Tax Bureau, and the First Tax Sub‑Bureau of the Wanyuan City Tax Bureau were successfully designated as part of the second batch of “Fengqiao‑style” tax sub‑bureaus in Sichuan Province.
Enabling the Public to Feel More Closely the Essence of Fairness and Justice—A Documentary on the Lishui People’s Court in Zhejiang’s Steady Implementation of the Initiative to Enhance Public Perception of Judicial Fairness
Fairness and justice are the soul and lifeblood of the judiciary. In December 2021, the Lishui Municipal Party Committee of Zhejiang Province convened a conference on court work, specifically addressing at the party committee level the advancement of efforts to enhance public perception of judicial fairness. Over the past year, the Lishui courts have deeply grasped the key concept of “perception,” aligning with the Zhejiang Provincial Higher People’s Court’s mandate to ensure cases are handled with the greatest fairness, the shortest possible time, and the strongest sense of judicial satisfaction among the people. In response to the public’s aspirations for a better life and their expectations for fairness and justice, the courts have vigorously promoted the “Project to Enhance Public Perception of Judicial Fairness.”
Finance & Capital Markets
CICC’s Jin Zhong on the strategic realignment and upgrading of investment banking: Empowering emerging industries and growing together with small and medium-sized enterprises.
Since 2022, the global equity‑financing market has lost its former vibrancy, yet China’s market continues to stand out. The global investment‑banking landscape has undergone profound shifts, and China’s investment‑banking sector is deepening steadily, with its ecosystem undergoing unprecedented transformation. In this era of sweeping change, how to keep pace with evolving trends and better serve national strategies, the real economy, and investors has become a key issue of widespread concern. According to Jin Zhong, Executive Head of the Growth‑Enterprise Investment Banking Division at CICC, China’s capital markets are playing an increasingly pivotal role in fostering the virtuous cycle among technology, capital, and industry. For investment banks, the focus of future strategic development will likewise be dynamically adjusted and upgraded in response to shifts in national policy, thereby more effectively empowering the growth of emerging industries.
Tech companies are riding a wave of IPOs.
Since the beginning of this year, the global initial public offering (IPO) market has contracted sharply. In particular, U.S. IPO activity has declined markedly, prompting a shift in the global IPO focus toward China. During the first three quarters of this year, A-share IPOs raised RMB 485.6 billion, marking a record high for the same period, and making the A-share market the largest globally in terms of new‑stock issuance volume. As of the end of the third quarter, four of the world’s top ten equity underwriters were Chinese investment banks. Among them, CICC ranked fourth worldwide, with a market share of 5.4%.
“Against the backdrop of a widespread slowdown in overseas IPOs, it is no small feat that A‑shares have managed to maintain a steady pace of new listings,” said Jin Zhong. He added that IPO activity among technology offices on the A‑share market remains robust, with the bulk of new issuers concentrated in “hard tech” sectors such as chips and semiconductors, high‑end manufacturing, new materials, and new energy.
In Jin Zhong’s view, this is largely attributable to the strengthened support from the capital market for technological innovation. With the launch of a series of capital market reforms—such as the establishment of the STAR Market, which focuses on “hard tech” and piloted a registration-based system; the reform of the ChiNext Board, which emphasizes “three innovations and four new developments” and also adopted a registration-based system; and the opening of the Beijing Stock Exchange, which serves as a primary platform for innovative small and medium-sized enterprises—the capital market’s capacity to underpin technological innovation has been significantly bolstered.
On the other hand, Jin Zhong noted that the financial performance of these technology‑related companies has withstood the test of the pandemic, with some even posting robust growth. This may be attributable to the fact that many offices have attracted industrial investors who have helped bolster their market position.
Looking ahead, Jin Zhong believes that A-share IPOs will remain on a normalized trajectory, with the registration-based reform injecting fresh capital into the market. The technology sector boasts a robust pipeline of companies poised for listing, and most offices exhibit a strong appetite for going public.
Accelerating the deployment in emerging fields.
The robust IPO market has also yielded substantial gains for CICC’s investment banking business.
In the first three quarters of 2022, CICC completed cumulative direct financing exceeding RMB 2.7 trillion, facilitated equity financing of approximately RMB 213.5 billion for science and technology enterprises, and supported financing for small, medium, and micro-sized enterprises totaling over RMB 170 billion. Since the launch of the STAR Market, the office has underwritten a cumulative total of more than RMB 200 billion on that platform.
Serving the real economy is the mission of investment banking. According to Jin Zhong, CICC consciously integrates its own development into the broader national development agenda, leveraging its professional expertise to support the growth of small, medium, and micro enterprises as well as technology-driven companies. To better deliver specialized advisory services, CICC’s Growth Enterprise Investment Banking Division has established nine industry-specific teams, assembling dedicated investment banking capabilities across sectors including TMT, pharmaceuticals and healthcare, consumer goods, high-end manufacturing, semiconductors and chips, clean energy, new materials, IoT technologies, and proptech, thereby providing more sophisticated investment banking solutions to drive the transformation, upgrading, and innovative development of the real economy.
In Jin Zhong’s view, the key distinction between serving growth-stage companies and traditional enterprises lies in maintaining a forward‑looking, pioneering mindset. Investment banks should move their service horizon as far upstream as possible, proactively nurturing companies that align with national policies and priorities. By engaging with these offices at the earliest stages of their ascent—whether at the enterprise or industry level—investment banks can cultivate them into long-term clients, thereby turning the capital markets into a powerful catalyst for the development of science and technology‑driven enterprises.
“Our previous client, Kingsoft Office, was valued at less than RMB 2 billion when we first began working with them. By the time it went public, its market capitalization exceeded RMB 20 billion, and its latest market cap has surpassed RMB 100 billion. We hope to identify more companies like this in the future, accompany them over the long term, and truly put into practice our vision of ‘empowering emerging industries through finance and growing alongside enterprises,’” said Jin Zhong.
Investment banks are stepping up value creation.
The capital market continues to underscore its “hard‑tech” foundation and fully unleash its “new vitality,” with emerging industries accelerating their growth. Investment banks, too, must deliver higher‑quality, more efficient financial services to support the development of these nascent sectors.
How can investment banks empower the development of emerging industries? According to Jin Zhong, this involves three key dimensions: first, deepening understanding of national strategies and industrial policies, enhancing professional expertise, and strengthening industry insight to align business assessments closely with the country’s policy priorities; second, providing end-to‑to‑end lifecycle services, proactively identifying and supporting promising companies at an early stage, and fostering the IPOs of more high‑quality enterprises; and third, translating the requirements of the registration-based system into concrete practice, elevating underwriting quality and professional standards, and fulfilling the role of gatekeeper in the capital markets.
In concrete practice, CICC actively implements the national strategies of the new era by deeply cultivating its industries, integrating and empowering resources to enhance value across the enterprise and related sectors. Taking the enterprise as the primary driver, it identifies business opportunities and designs capital‑market strategies tailored to the industry’s stage of development, the company’s life cycle, and its unique characteristics, thereby uncovering and creating value. CICC provides end-to-end financial services spanning the entire industrial chain and draws on international best practices to build a modern capital market with Chinese characteristics.
“Outstanding Chinese investment banks must earnestly serve the real economy and support the localization of cutting-edge technologies in China. While leading China’s economic development on the industrial front, they should also pave the way for rapid growth over the next 10 to 20 years and contribute to the cause of Chinese-style modernization. This is also the goal of CICC,” said Jin Zhong.
A-shares have welcomed the first brokerage office to go public this year, as First Capital Securities embarks on a new chapter in the capital markets.
 On December 22, A-shares welcomed the first brokerage office to list this year: First Capital Securities (601136.SH) made its debut on the A-share market, becoming the 42nd listed brokerage in the A-share arena. The offering price was RMB 7.07 per share, with a successful public issuance of 273 million shares, raising a total of RMB 1.932 billion.
According to reports, First Capital Securities was founded in 2000. With strong support from the Beijing Municipal Government and the State-owned Assets Supervision and Administration Commission of the Beijing Municipality, it has now grown into a nationwide, full-service securities office with distinctive characteristics and regional competitive advantages. As a comprehensive securities company holding all necessary licenses, it has established a well-balanced business structure encompassing asset management, investment services, investment banking, retail and wealth management, as well as research.
Regarding its successful listing on the capital market, First Capital Securities stated that, following this IPO, the company’s net assets and net capital will increase substantially, and its risk‑resilience is expected to be further strengthened. This will enable the company to rapidly bolster its capital base, enhance the sustainability of its business growth, and improve its ability to withstand risks.
Asset management and fixed-income businesses are rapidly gaining momentum.
Depending on the type of business and the relevant licenses, Shouchuang Securities’ operations are categorized into asset management, investment, investment banking, retail and wealth management, and research. Among these, the office’s traditional businesses have demonstrated steady performance, while its asset management and fixed-income investment‑trading segments have established distinct strengths and competitive advantages.
Driven by robust growth in its active asset management and fixed-income businesses, First Capital Securities has posted impressive earnings momentum in recent years. According to data, the company’s revenue reached RMB 1.34 billion, RMB 1.658 billion, and RMB 2.113 billion in 2019, 2020, and 2021, respectively, with a compound annual growth rate of nearly 30% and significant expansion in business scale. Meanwhile, its net profit stood at RMB 434 million, RMB 611 million, and RMB 859 million over the same period, reflecting a compound annual growth rate exceeding 40% and strong profitability.
In the fixed-income investment business, Shouchuang Securities places proprietary investing at its core while vigorously expanding diversified capital‑intermediation services and quantitative hedging activities. The office boasts strong competitiveness in areas such as the profitability of its proprietary investments, the returns generated by its quantitative strategies, and its ability to deliver high‑quality client service in institutional business.
From 2019 to 2021 and for the first six months of 2022, First Capital Securities’ fixed-income investment and trading business generated revenues of RMB 386 million, RMB 214 million, RMB 558 million, and RMB 350 million, respectively. As a key source of income for the office, this business has become one of its signature offerings and has steadily built a competitive edge.
In addition, from 2019 to 2021 and for the first six months of 2022, First Capital Securities’ fixed-income investment business delivered returns of 11.90%, 5.41%, 9.40%, and 4.87%, respectively. Over the same periods, the China Bond Composite Index posted total gains of 4.59%, 2.98%, 5.09%, and 1.83%, with the office’s fixed-income investment returns significantly outpacing the index.
In the asset management business, First Capital Securities has leveraged its longstanding strengths in fixed-income investment and trading while actively expanding into the equity space. As a result, its asset management capabilities have continued to strengthen, its AUM has grown rapidly, and its asset management revenue has risen year after year, making it one of the office’s core competitive advantages.
According to the prospectus, from 2019 to 2021 and for the period January–June 2022, First Capital Securities’ asset management business generated revenues of RMB 223 million, RMB 415 million, RMB 438 million, and RMB 319 million, respectively, accounting for 16.65%, 25.02%, 20.71%, and 42.12% of its total operating revenue in each respective period.
Increase R&D investment to strengthen core competitiveness.
The varying research capabilities of securities offices have become a key manifestation of their core competitiveness, with their research functions providing decision‑making support for other business lines, including brokerage, proprietary trading, and asset management.
Data show that, for the periods 2019–2021 and January–June 2022, the research expenses of the Research and Development Department at First Capital Securities were RMB 5.8769 million, RMB 6.3582 million, RMB 20.3448 million, and RMB 15.1712 million, respectively.
As of June 30, 2022, the Research and Development Department of First Capital Securities had 55 employees, including 22 individuals qualified to provide securities investment advisory services (analysts). Among them, 6 held doctoral degrees, accounting for 10.91%; 45 held master’s degrees, representing 81.82%; and 4 held bachelor’s degrees or lower, making up 7.27%.
Currently, the Research and Development Department of First Capital Securities has established a comprehensive research framework encompassing macroeconomics, industrial economics, and listed companies, covering macroeconomic analysis as well as multiple sectors including technology, consumer goods, chemicals, real estate, and environmental protection. The department provides clients with a wide range of research services, such as research reports, roadshows, and industry surveys.
However, First Capital Securities acknowledges that, compared with other large securities offices in the industry, its research team remains relatively small and covers a limited range of sectors. Following this fundraising, the company plans to allocate the proceeds to bolster its research capabilities, building a competitive sell-side research team. While providing robust internal research support, it will also leverage macro‑strategy research to establish influence across key sectors—including technology, consumer goods, commodities, real estate, and environmental protection—thereby strengthening the office’s research brand.
Regarding its future development strategy, First Capital Securities stated that, as a securities office controlled by Beijing municipal state-owned assets, the company has consistently regarded serving the capital’s development and national strategic priorities as its core mission. Adhering to a business philosophy of high-quality growth, over the next three years, the company will seize the historic opportunities presented by favorable national policies for the securities industry. It will steadfastly pursue a differentiated growth strategy—centered on asset management, supported by retail and wealth management as well as investment banking, and balanced by investment‑related activities—expand its competitive edge in specialized businesses, accelerate the transformation and upgrading of traditional operations, continuously refine its operational and management mechanisms, and enhance the professionalism of its services. The company is committed to becoming a distinctive, respected financial services provider.

The 42nd A-share‑listed brokerage, First Capital Securities, has officially listed; Guosen Securities’ underwriting of its IPO generated a paper profit exceeding RMB 4.85 million on the first day.
On December 22, First Capital Securities became the first brokerage office to list on the A-share market this year, bringing the total number of listed securities offices to 42.
Based on the subscription results for the new shares issued by First Capital Securities, online investors subscribed for 244 million shares, with a total subscription value of RMB 1.728 billion; the number of shares renounced was 1.5369 million, corresponding to a renunciation value of RMB 10.8661 million. Meanwhile, offline investors renounced 22,887 shares, amounting to RMB 161,800.
To date, all shares that were renounced by both offline and online investors in First Capital Securities have been underwritten by the sponsor (lead underwriter), Guosen Securities. The number of shares underwritten by Guosen Securities amounts to 1.5598 million, with a total underwriting value of RMB 11.0279 million, representing an underwriting ratio of 0.57%.
Shouchuang Securities set its IPO price at RMB 7.07 per share, with a price-to-earnings ratio of 22.98 times. On its debut day, the stock closed at RMB 10.18 per share, up 43.99%, giving the company a market capitalization of RMB 27.83 billion. Based on the closing price on December 22, Guosen Securities’ underwritten shares posted a paper profit of RMB 4.851 million on the first day. Earlier, Shouchuang Securities had issued special investment‑risk warnings at least once a week for three consecutive weeks prior to online subscription, citing a P/E ratio that was excessively high compared with its peers.
Yan Xiaowei, a non‑bank financial analyst at Datong Securities, stated, “Equity financing remains the primary means for small and medium‑sized securities offices to raise capital and expand their businesses, and we expect the number of A‑share‑listed securities offices to continue growing in the future. The capital raised through equity offerings will also help Shouchuang Securities develop its specialized business lines and better serve the capital markets.”
Currently, capital strength has become one of the key factors shaping the development of securities offices. From 2018 to 2020, the A-share market welcomed a total of 11 new entrants; however, since 2021 and into 2022, only one new office has joined each year. At present, mid- and small-sized securities offices are actively raising equity capital through IPOs. On December 16, Cinda Securities announced that its initial public offering had received approval from the China Securities Regulatory Commission, marking the start of its listing process. As a result, the number of securities offices listed on the A-share market is expected to grow further in the near term.
Since the beginning of this year, the overall valuation of the securities sector has remained at a relatively low level compared with recent years, while stock‑by‑stock performance has been diverging at an accelerating pace. With new players continuing to join the sector, its future trajectory is increasingly worth watching.
Looking ahead to 2023, Wang Simin, a non‑bank financial analyst at Everbright Securities, believes that “the anticipated policy tailwinds, marginal improvements in fundamentals, and the rapid growth of emerging businesses such as derivatives and market‑making are all providing strong support for further enhancing the sector’s investment appeal. Although the securities industry’s performance declined in the first three quarters of 2022 due to short‑term market volatility, there remains substantial room for expansion in wealth management, investment banking, and institutional services going forward. At the office level, ‘diversification’ is the key theme driving industry dynamics; during this process, leading securities offices and those with distinctive competitive advantages are likely to capture excess returns.”
Shouchuang Securities: Accelerating Transformation and Upgrading Through a Differentiation Strategy
On December 22, First Capital Securities officially listed on the Shanghai Stock Exchange’s main board, becoming the 42nd securities office in the A-share market.
In 2022, the securities industry as a whole faced performance pressures due to multiple external factors. Since the beginning of this year, First Capital Securities has pursued steady and prudent growth across all business lines. As of the end of September 2022, the company’s total assets increased by 13.03% year over year, net revenue from asset management businesses rose 91.78% year over year from January to September, and its fixed-income investment returns significantly outperformed benchmark indices.
“Listing on the capital market marks a significant milestone in Shouchuang Securities’ development,” said Su Chaohui, Chairman of Shouchuang Securities. He added that the company will seize this opportunity to continuously expand its business scale, strengthen its innovation capabilities, and build a strong brand image, striving to become a distinctive and respected financial services provider that contributes to the growth of the real economy and the economic development of the capital. Bi Jinsong, Secretary of the Party Committee and General Manager of Shouchuang Securities, outlined the office’s upcoming new chapter in capital markets.
Adhere to a strategy of diversified and differentiated development.
This year has been exceptionally challenging for the securities industry. According to data recently released by the China Securities Association, the 140 securities offices surveyed generated total operating revenue of RMB 304.242 billion in the first three quarters of 2022, a year-on-year decrease of 17.0%; their combined net profit stood at RMB 116.763 billion, down 18.9% from the same period last year.
In Su Chaohui’s view, short-term market volatility cannot alter the securities industry’s long-term upward trajectory. He believes that, compared with developed countries in Europe and North America, China’s securitization ratio remains relatively low, leaving considerable room for growth. Government policies supporting direct financing and the gradual establishment of a multi-tiered capital market will directly propel the expansion of securities offices’ various business lines, creating substantial opportunities for the industry.
Regarding the future development strategies of small and medium-sized securities offices, Bi Jinsong believes that diversification and differentiated growth will be the key to success.
“As the development of a multi-tiered capital market continues to advance and reforms and innovations in the securities industry deepen, securities offices have gradually expanded beyond their traditional businesses into innovative areas such as asset management, asset securitization, distribution of financial products, investment advisory services, alternative investments, and public mutual funds, thereby diversifying their profit models.” He believes that for small and medium-sized securities offices, the path forward over the coming period lies in strategically focusing on specific niche segments and leveraging their inherent strengths—such as shareholder backing, geographic advantages, network deployment, and innovation capabilities—to build distinctive, high‑quality offerings and achieve specialized, differentiated growth.
According to reports, First Capital Securities has steadily enhanced its ability to provide diversified financial services to enterprises in recent years. It has cumulatively recommended more than 20 Beijing–Tianjin–Hebei–based companies for listing on the New Third Board and has continuously provided ongoing supervision to over 60 listed companies from the region, including one that completed an IPO on the STAR Market and another that listed on the Beijing Stock Exchange. The company’s clients Shiji Tianhong and Bayi Shikong successfully transitioned to IPOs on other exchanges, while Shuguang Shuchuang was successfully listed on the Beijing Stock Exchange. At present, several additional projects are undergoing shareholding reform and pre-IPO guidance, with a favorable outlook for business development.
Meanwhile, the company has also leveraged innovative financing instruments such as green bonds and panda bonds to provide professional, high‑quality bond underwriting and asset‑securitization services to leading Beijing‑based enterprises, including Shouchuang Group, BAIC Group, Shougang Group, Beijing Infrastructure Investment Co., Ltd., and JD.com, with total proceeds exceeding RMB 90 billion.
Su Chaohui stated that, going forward, the company will remain committed to its original mission of serving the real economy, steadily advance its New Third Board business, actively nurture companies listed on the Beijing Stock Exchange, and enhance its capacity to support small and medium-sized enterprises as well as “specialized, refined, distinctive, and innovative” offices. Leveraging its strengths in industry research and industrial services, the company will strengthen cross‑business synergies and contribute to building a premier platform for serving innovative SMEs. At the same time, it will continue to increase resource allocation and intensify efforts in inclusive finance and green finance, thereby supporting the development of the real economy, advancing national strategic priorities, and making an even greater contribution to society.
Transforming and upgrading the wealth management business
The IPO of First Capital Securities raised approximately RMB 1.932 billion. After deducting issuance expenses, the proceeds will be entirely used to increase the capital of the company and its wholly owned subsidiaries, replenish working capital, and expand the scale of operations, thereby supporting future business growth and advancing the achievement of the company’s strategic objectives.
“Specific uses include, but are not limited to, increasing investment in information technology infrastructure to enhance back-office integrated service capabilities; boosting investment in research activities; strengthening the strategic deployment of subsidiaries; and replenishing operating capital,” said Bi Jinsong. He added that, upon completion of this issuance, the company’s net assets and net capital will increase substantially, thereby further enhancing its risk resilience.
Today, driven by industry competition and regulatory reforms, the traditional securities brokerage business is transitioning from a transaction‑channel‑based service to wealth management, with a customer‑centric approach that builds a buy-side–oriented wealth‑management service ecosystem. The cross‑industry integration of new technologies such as big data and artificial intelligence also provides robust technical support for securities offices to offer services like robo‑advisory, thereby enhancing both the quality and efficiency of wealth‑management offerings.
Taking this IPO as an opportunity, First Capital Securities will further accelerate its transformation and upgrading. According to Bi Jingsong, the company will continue to increase investment in information technology, enhance its back-office integrated service capabilities, and comprehensively leverage financial technology to support the development of key businesses such as asset management and fixed income, striving to improve operational efficiency and strengthen compliance and risk control.
According to available information, Shouchuang Securities has steadily intensified its business transformation in recent years, optimized its business structure, and focused on building capabilities in wealth management, capital intermediation, and active investment management. As a result, the performance of its traditional businesses has grown steadily, while its asset management and fixed-income investment‑trading operations have developed distinct strengths and competitive advantages. Based on data from the Securities Association, in 2019, 2020, and 2021, the company’s net profit and return on equity consistently ranked well above its ranking by total equity, with its return on equity placing it among the industry leaders.
Bi Jinsong stated that, following its entry into the capital markets, the company will further optimize its business structure by focusing on building strong brands in asset management and fixed-income‑centric investment services, bolstering its investment banking capabilities, achieving breakthroughs in retail and wealth management, and continuously refining a business framework tailored to its specific circumstances. The company will comprehensively enhance its core competencies—including investment and financing capacity, sales expertise, product design capabilities, and risk management—and pursue a well‑planned, synergistic development across all major business lines. Ultimately, it aims to strengthen its integrated financial services platform and improve its capacity for sustainable growth.
Turning to the company’s medium- and long-term development strategy, Su Chaohui stated that the office will seize the historic opportunities presented by national policy support for the securities industry. It will steadfastly pursue a differentiated growth strategy—centered on asset management, supported by retail and wealth management as well as investment banking, and balanced by investment‑related activities—while expanding its competitive edge in specialized businesses, accelerating the transformation and upgrading of traditional operations, and continuously refining its management and operational frameworks to enhance the quality of its professional services.

Commercial & Corporate
Feihe has taken up the challenge of a “14th Five-Year Plan” project, leading the development of a new generation of infant formula.
On December 22, at the China Feihe 60th Anniversary Strategic Upgrade Launch Event—titled “Bottling Active Nutrition, Tailored to Chinese Babies’ Physiological Needs”—Feihe announced that its lead application for the project “Research and Demonstration of Next-Generation Infant Formula Manufacturing Technology Based on Chinese Breast Milk Studies” had been successfully approved. This follows last year’s successful bid by Feihe, in collaboration with Jiangnan University, Dalian Polytechnic University, and other institutions, to undertake the project “Innovation and Demonstration of Scalable Production Technologies for Novel Core Ingredients in Infant Formula,” marking another successful entry into a key national R&D program under the 14th Five-Year Plan.
As of now, within the framework of the 14th Five-Year National Key R&D Program, there are two projects related to infant formula; Feihe is leading one special project and one sub‑project. The “listing‑for‑leadership” mechanism has been a major reform initiative since the start of the 14th Five-Year Plan. Each call for proposals targets critical national priorities and places stringent demands on the managing, implementing, and research‑innovation capabilities of the teams that take up the challenge.
In fact, in recent years, Feihe has consistently achieved groundbreaking advances in breast-milk research, raw-material development, and product innovation, maintaining a leading position in the industry.
Feihe was among the first companies to launch research on Chinese breast milk and has now established a national database encompassing approximately 20,000 samples from 27 provinces, autonomous regions, and municipalities directly under the central government. Building on this foundation, Feihe has continuously achieved cutting-edge scientific breakthroughs in the field of breast-milk bioactive components—for example, it was the first to demonstrate, through a systematic review, that the DHA/ARA ratio in Chinese breast milk is 1:1.7, and it has precisely quantified the dynamic changes over six distinct lactation stages for 11 bioactive substances, including lactoferrin and osteopontin.
In the area of active functional ingredient development, after six years of sustained research and technological breakthroughs, Feihe completed China’s first automated lactoferrin production line in 2022 and successfully obtained manufacturing approval, thereby breaking the long-standing foreign monopoly. Furthermore, under the National Key R&D Program during the 14th Five-Year Plan period, Feihe will continue to advance the independent development of active functional ingredients.
Feihe’s research achievements are also steadily being translated into product innovations. Its flagship formula, Starfly Fan Zhuorui, is specially fortified with the proprietary Mul-MFPL® milk phospholipid complex and next-generation patented OPO, among other bioactive nutrients, to help support infants’ immune health.
“Through years of ongoing research, we have found that the bioactive nutrients in breast milk play a crucial role in infants’ growth and development,” said Jiang Shilong, Chief Scientist at Feihe. It is precisely because of this emphasis on bioactive nutrition that Feihe has introduced a new strategy—“Freshly Extracted Bioactive Nutrients, Better Suited to Chinese Babies’ Physiological Needs”—and developed a next-generation infant formula.
In Jiang Shilong’s view, the next generation of infant formula should possess three key characteristics: first, it should be formulated based on Chinese breast‑milk research; second, it should preserve the bioactive nutrients found in breast milk; and third, its feeding outcomes should closely mimic those of breast milk. Looking ahead, Feihe will focus on “freshly extracted active nutrients,” centering on the critical first 1,000 days of life. The company plans to conduct in-depth research across five key areas: establishing a breast‑milk sample bank and mother–child cohort that cover typical regions across China; developing analytical methods for breast‑milk functional components and standardizing them; building efficacy‑evaluation models linking nutritional profiles to formula performance; exploring cutting‑edge “freshness‑locking” technologies; and creating a new generation of infant formula grounded in Chinese breast‑milk research.
Leveraging the National Key R&D Program of the 14th Five-Year Plan, Feihe will also join forces with institutions such as Shanghai Jiao Tong University and Peking University to establish a university–enterprise innovation consortium. By proactively adopting research methodologies from disciplines like medicine and nutrition, the company will further advance scientific studies on bioactive nutrients in breast milk and tackle key challenges in developing bioactive raw materials, thereby achieving all‑round progress in bioactive‑nutrient research and creating a new generation of infant formula.

Shutai Shen plans a private placement to raise no more than RMB 580 million, which will be used for the development of COVID-19 therapeutics and other purposes. Analysts note that it is currently difficult to forecast the future trajectory of the pandemic.
On December 23, Shutaishen issued an announcement stating that the company plans to raise up to RMB 580 million through a private placement, which will be allocated to innovative drug development projects, including the combination therapy of STSA-1002 and STSA-1005, the injectable formulation of STSP-0601, and the BDB-001 injection. Specifically, the combination of STSA-1002 and STSA-1005 is indicated for the treatment of severe and critically ill cases of novel coronavirus pneumonia, with plans to expand its application to acute respiratory distress syndrome (ARDS).
“The proceeds from this fundraising will be used to advance the clinical trials of our key pipeline products, ensuring that these candidates progress through their planned trial schedules, gain access to clinical therapeutic applications, generate robust clinical data, and complete the full drug development cycle,” said Shutaishen. “If these innovative drug programs are successfully executed, they will effectively safeguard the company’s R&D pipeline, broaden and deepen the scope of clinical trials for our pipeline assets, and lay the groundwork for bringing more commercially viable products to market.”
Previously, the proposed private placement had ended without success.
This is not the first time that Shutaishen has raised funds for the aforementioned innovative drug development projects. In September 2022, Shutaishen issued an announcement stating its intention to raise RMB 300 million through a simplified private placement to support the development of innovative drugs, including the STSA-1002 and STSA-1005 combination therapy, the injectable STSP-0601, and the BDB-001 injection project. However, on December 7, Shutaishen announced that, taking into account actual circumstances and its development strategy, it had decided to cancel this proposed private placement.
The September 2022 private placement fundraising projects encompass all of the current offering’s fundraising initiatives; however, just 16 days after the original plan was terminated, Shutaishen’s revised private placement proposal increased the targeted fundraising amount from RMB 300 million to RMB 580 million.
According to Shutaishen’s financial data, the company reported operating revenues of RMB 425 million, RMB 584 million, and RMB 383 million for the years 2020, 2021, and January–September 2022, respectively. Correspondingly, its net profits attributable to shareholders were negative RMB 133 million, RMB 137 million, and RMB 155 million, with losses widening year over year.
Xing Xing, Director of the Bosheng Securities Research Institute and Chief Investment Advisor, stated: “There are many factors that influence a company’s refinancing. Beyond whether the proposed plan gains market approval, secondary‑market performance is also a critical determinant. If, during the private placement period, the stock price remains persistently weak and the market price falls below the placement price, it becomes very difficult for the offering to proceed smoothly. Shutaishen has repeatedly announced private‑placement proposals for the same project, underscoring the management’s commitment to the targeted investment initiatives. However, this also highlights the company’s relatively fragile fundamentals: since 2020, its earnings have been in the red, and in the first three quarters of 2022, Shutaishen faced particularly acute operational pressures. Against a backdrop of declining results, embarking on large‑scale new‑project development risks diverting management’s focus from core business operations.”
COVID-19 drug development deserves attention.
With the optimization of COVID‑19 prevention and control policies, drugs such as Paxlovid and Azvudine have attracted significant market attention. In this fundraising project, the combination therapy of STSA‑1002 and STSA‑1005 is indicated for the treatment of severe and critically ill cases of novel coronavirus pneumonia and is being expanded to include acute respiratory distress syndrome (ARDS). The total investment amounts to RMB 304 million, with RMB 199 million planned to be funded from the proceeds of the offering, accounting for 34.23% of the total funds raised.
Previously, Shutaishen announced that in August 2022, the company obtained approval notices for clinical trials of STSA‑1002 injection and STSA‑1005 injection (indications: treatment of severe and critically ill cases of novel coronavirus pneumonia). The programs are currently in Phase I, with completion of the Phase I trial in healthy volunteers expected in the first half of 2023. Following this, the company plans to submit an application to the FDA and engage in discussions regarding the expansion of the indications to include ARDS. Phase II is anticipated to commence as early as the second half of 2023, with Phase III potentially beginning in the second half of 2024 at the earliest.
Shutai Shen stated that, at present, the nonclinical studies of STSA‑1005 and STSA‑1002 as monotherapies are quite comprehensive. Phase I clinical trials of STSA‑1005 injection and STSA‑1002 injection have demonstrated a favorable safety profile. Moreover, the combination of STSA‑1002 and STSA‑1005 effectively suppresses the overactivation of myeloid cells—namely, monocytes/macrophages and neutrophils—and STSA‑1005 can reduce the bone marrow mobilization of these myeloid cells. In addition, STSA‑1002 has been shown to confer benefits in ameliorating thrombotic complications in patients, suggesting a potential synergistic effect. These findings provide a theoretical basis for the combined use of the two agents in the treatment of severe and critically ill cases of novel coronavirus pneumonia, with plans to extend such studies to acute respiratory distress syndrome (ARDS) in the future.
“While it is commendable for listed companies to actively invest in the development of COVID‑19 therapeutics, if a project is still at an extremely early stage and fraught with high uncertainty, raising capital through a share issuance may not be the most appropriate approach,” said Kuang Yuqing, founder of Lens Research. “Innovative drugs in Phase I and Phase II clinical trials remain in the basic R&D phase; companies should finance these stages using their own funds. Reserving fundraising until Phase III, when results are more definitive, can effectively mitigate investor risk.”
“The COVID‑19 drug that Shutaishen is raising funds to develop has a certain time sensitivity. As viral strains mutate and alternative therapies emerge, and given the impact of time, even if the final product ultimately reaches the market, it remains unclear whether it will still enjoy a relative competitive advantage,” Xing Xing added. “At present, new‑drug development in the pharmaceutical sector is overheated, and the R&D cycle is lengthy. According to relevant data, the success rate for Phase III clinical trials is often low, meaning there is significant uncertainty regarding whether the trial phase will proceed smoothly and whether the product will truly meet the requirements for market approval. The company plans to initiate Phase III clinical trials in the second half of 2024; however, it is currently difficult to forecast future pandemic trends, leaving considerable uncertainty.”
As for this proposed private placement, the market may not be optimistic. As of the close on December 23, Shutaishen’s share price stood at RMB 16.69 per share, down sharply by 8.35%.

Jianghuai Automobile plans to acquire certain assets of Anhui NIO for RMB 1.704 billion.
From contract manufacturing to joint‑venture plant construction and, more recently, the acquisition of certain assets from NIO in Anhui, JAC Motors (600418) has steadily deepened its collaboration with the new‑energy vehicle upstart NIO over the past six years.
On the evening of December 22, JAC Motors announced that it plans to acquire project assets related to the under-construction equipment installation works—held by NIO Automobile (Anhui) Co., Ltd. (hereinafter referred to as “Anhui NIO”), including equipment and tooling assets—at an estimated transaction price of RMB 1.704 billion. If the transaction is successfully completed, it will help further deepen the strategic cooperation between the two companies.
According to Qichacha, Anhui NIO was established on August 19, 2020, with Qin Lihong serving as its legal representative. The company has a paid-up registered capital of RMB 9 billion, and NIO Holding Group holds 100% of its equity. Qin Lihong is a co-founder of NIO and has served as both a director and president of the company since 2014.
From the perspective of the acquisition target, the assets to be acquired comprise project‑related assets under construction—specifically equipment installation projects—held by Anhui NIO, including equipment and tooling assets. According to the audited financial statements, the book value of the transaction target is RMB 1.508 billion, while the appraised transaction price is RMB 1.704 billion.
In response, JAC Motors stated that this transaction does not constitute a related-party transaction or a major asset restructuring, and there are no significant legal obstacles to its implementation. The acquisition will not affect the company’s normal production and operations; if successfully completed, it will help further deepen the strategic cooperation with NIO.
Jianghuai Automobile and NIO have long maintained a cooperative relationship; in March last year, the two parties jointly invested in building a manufacturing plant. On March 4, 2021, Jianghuai Automobile announced that it had signed a letter of intent for a joint venture with NIO Holdings Limited, under which the two sides plan to establish Jianglai Technology Co., Ltd. (“the Joint Venture”) in Hefei. The proposed registered capital of the Joint Venture is RMB 500 million, with Jianghuai Automobile intending to subscribe for 51% and NIO intending to subscribe for 49%.
At the time, JAC Motors stated that the joint venture would leverage the industrial internet and its mature manufacturing management expertise to deliver smart manufacturing and technology‑based service solutions to customers. It would also undertake proactive innovation and exploration in areas such as new‑energy vehicle assembly, service models, and management systems, using these efforts as a foundation to build a new “advanced manufacturing + industrial internet” ecosystem underpinned by technologies including automation, networking, platformization, big data, the Internet of Things, and artificial intelligence—thereby driving the development of China’s green industries and the new‑energy vehicle sector.
In fact, the two companies first joined forces six years ago. In April 2016, NIO and JAC Motors signed a five-year Manufacturing Cooperation Framework Agreement, under which they would comprehensively advance collaboration across the new‑energy vehicle and intelligent connected‑vehicle value chains. The overall cooperation was projected to total approximately RMB 10 billion, and the agreement conofficeed JAC’s plan to provide contract manufacturing capacity of 50,000 vehicles in the first phase. The agreement expired at the end of March 2021.
Since then, JAC Motors has remained the contract manufacturer for NIO. Following the expiration of their original contract in May 2021, NIO announced that, from May 2021 to May 2024, JAC would continue producing the ES8, ES6, EC6, ET7, and any other NIO models that may be introduced. JAC also plans to expand its annual production capacity to 240,000 vehicles—based on 4,000 operating hours per year—to meet the growing market demand for NIO’s brand.
According to JAC Motors’ 2021 financial report, the company achieved significant results in its collaboration with NIO in 2021, delivering approximately 93,000 vehicles for the year.
Since the beginning of this year, JAC Motors has seen a significant increase in sales of its all‑electric passenger vehicles. On December 7, the company announced that in November, its vehicle sales totaled 45,300 units, down 7.38% year over year. Among them, all‑electric passenger car sales reached 18,900 units, up 17.28% compared with the same period last year. From January to November, the company’s total vehicle sales amounted to 457,500 units, a 5.12% decline year over year. During this period, all‑electric passenger car sales stood at 173,000 units, representing a 47.46% year‑on‑year increase.
NIO, the new‑energy vehicle maker, has posted year‑over‑year revenue growth for ten consecutive quarters as of the third quarter this year. On November 10, NIO released its Q3 2022 financial results. The company’s Q3 revenue reached RMB 13.0 billion, up 32.6% year over year, marking the tenth straight quarter of positive growth. Its gross margin on vehicle sales stood at 16.4%. However, NIO’s losses widened, with a net loss of RMB 4.111 billion. Adjusted net loss totaled RMB 3.499 billion, up 514.2% from Q3 2021 and 54.3% from Q2 2022.
Leishen Technology today successfully went public, becoming the first “new national brand” in the esports equipment sector listed on the Beijing Stock Exchange.
On December 23, Raytheon Technology successfully listed on the Beijing Stock Exchange, with the stock ticker “Raytheon Technology” and the stock code 872190. As a domestic brand of esports equipment, Raytheon Technology’s successful IPO has filled a gap in the Beijing Stock Exchange’s coverage of the high-performance esports‑equipment sector, making it the exchange’s first publicly listed company specializing in esports gear.
Thunderobot is a high-performance computer hardware manufacturer, offering products such as laptops, desktops, and peripherals—including monitors, keyboards, mice, and headphones. Currently, “Thunderobot” and “Machenike” are Thunderobot’s two flagship high-performance computer hardware brands, focusing on the esports‑oriented hardware segment and enjoying strong brand recognition among younger consumers, particularly esports enthusiasts.
As of December 23, the Beijing Stock Exchange had 156 listed companies, primarily concentrated in the manufacturing and information technology sectors. Prior to Leishen Technology, no esports equipment company had yet gone public. Currently, the exchange’s total market capitalization exceeds RMB 200 billion, with trading activity robust, making it an important component of the A-share market.
Following its successful entry onto the capital markets, Leishen Technology’s market competitiveness will be further strengthened. On the one hand, in addition to raising capital upon completion of the offering, the listed company will gain access to more convenient financing channels, significantly bolstering its financial strength. On the other hand, as the first esports‑equipment brand to list on the Beijing Stock Exchange, Leishen Technology has had its operational compliance recognized by regulatory authorities, which will substantially enhance its brand influence.
As one of the earliest domestic companies to enter the esports‑laptop segment, Thunderobot enjoys a clear first‑mover advantage and currently holds a leading position. According to data from a QYResearch report, in 2020 the company captured an 8.87% share of the domestic esports laptop and desktop market by unit sales, ranking third, and an 7.83% share of revenue, ranking fourth.
According to the prospectus, from 2019 to 2021, Leishen Technology reported operating revenues of RMB 2.091 billion, RMB 2.254 billion, and RMB 2.642 billion, respectively, with year-on-year growth rates of 7.82% in 2020 and 17.21% in 2021. Net profits attributable to owners of the parent company were RMB 56.7808 million, RMB 60.7595 million, and RMB 77.7343 million, representing year-on-year increases of 7.01% in 2020 and 27.94% in 2021.
It is foreseeable that, amid the booming growth of the esports industry, the core niche markets for Thunderobot—namely esports‑oriented laptops and desktops—will also continue to expand rapidly. According to a research report published by QYResearch, China’s esports laptop and desktop market is projected to exceed RMB 55 billion by 2027, maintaining its upward trajectory.
Leveraging the proceeds from this IPO, Thunderobot’s market competitiveness will be significantly strengthened. According to the prospectus, the funds raised will be allocated to projects including a brand‑upgrade and headquarters operations center initiative, as well as the establishment of a product development and design center and related hardware R&D efforts. With its Qingdao headquarters operations center at the core, Thunderobot plans to spend three years rolling out a comprehensive, scenario‑specific hardware product brand‑upgrade strategy across China, further enhancing its brand influence and market competitiveness.
As the first publicly listed esports‑equipment brand on the Beijing Stock Exchange, Thunderobot has already achieved strong results in its niche market. Now, leveraging the platform of the capital markets and riding the wave of rapid industry growth—coupled with its unwavering commitment to R&D and steadily strengthening technological capabilities—the company’s product offerings will continue to improve, driving further breakthroughs in performance and shining a spotlight on China’s homegrown computer‑hardware brands.
Taxation
Overview of Dazhou Tax Authorities’ Efforts to Build “Fengqiao‑Style” Tax Sub‑Bureaus
On December 21, several “Fengqiao‑style” tax sub‑bureaus in Dazhou City were officially inaugurated. The First Tax Sub‑Bureau of the Tongchuan District Tax Bureau, the Shiqiao Tax Sub‑Bureau of the Dachuan District Tax Bureau, the First Tax Sub‑Bureau of the Qu County Tax Bureau, and the First Tax Sub‑Bureau of the Wanyuan City Tax Bureau were successfully designated as part of the second batch of “Fengqiao‑style” tax sub‑bureaus in Sichuan Province.
In recent years, the tax authorities of Dazhou City have steadfastly sought to deeply grasp the essence of the “Fengqiao Experience” in tax governance for the new era, vigorously advancing the development of “Fengqiao‑style” tax sub‑bureaus and continuously unleashing the benefits of “meticulous service, intelligent prevention, swift dispute resolution, follow-up visits, multi‑stakeholder co‑governance, and harmonious taxpayer‑tax authority relations.” The principles of “preventing disputes from being escalated, ensuring public safety, and providing comprehensive services” are increasingly taking root, effectively addressing tax‑related disputes at their source and steadily gaining momentum.
Integrating distinctive features to build a cutting-edge hub for the rule of law.
Dazhou boasts a wealth of local cultural resources. How can we leverage these regional characteristics to establish “Fengqiao‑style” tax sub‑bureaus, fortify the rule‑of‑law framework at the grassroots level, and address issues such as taxpayers’ limited understanding, poor communication, and lack of awareness of tax policies? The city’s tax system has conducted a thorough analysis of its own strengths and distinctive features, and, in conjunction with the development of “model agencies for service‑oriented law enforcement,” has focused on identifying key breakthroughs in building these Fengqiao‑style tax sub‑bureaus. By doing so, it seeks to integrate the practical goals of service‑oriented law enforcement and problem‑solving into the broader framework of local rule‑of‑law development, thereby translating the “Fengqiao Experience” of the new era into concrete tax governance at the grassroots level.
In Tongchuan District, the “Shuirun” Mediation Studio is being effectively leveraged to transform the “Fengqiao‑style” tax sub‑bureau into a frontline outpost and a robust bastion—delivering tangible results, improving people’s livelihoods, mitigating risks, safeguarding public safety, and fostering vitality. “We’ve been chasing this property certificate for years, and with your assistance, we’ve finally obtained our ‘house deed.’ The heavy burden that had been weighing on our hearts has finally lifted. Thank you!” Wang Zhiqi, a representative of the “Xingfu Jiayuan” project’s homeowners, expressed strong appreciation for the Tongchuan District Tax Bureau’s “Shuirun Mediation Studio” in helping resolve their difficulties.
In Dachuan District, a new grassroots tax‑governance model has been established, integrating six components: “cloud‑based listening and tax‑information gathering, cloud‑based services and tax‑law assistance, cloud‑based mediation and comprehensive dispute resolution, cloud‑based live streaming and legal redress, cloud‑based enforcement and rights protection, and cloud‑based analysis and risk prevention.” “By rolling out an integrated ‘cloud‑service’ platform to address taxpayers’ tax‑related queries on the Fengqiao ‘cloud,’ we are taking a key step in advancing the construction of the ‘Cloud Fengqiao’ initiative,” said Xiang Ran, Director of the Dachuan District Tax Bureau.
One blossom inspires a hundred to bloom; the jade tree stands by the breeze, gazing toward spring’s arrival. Today, Dazhou has established seven “Fengqiao‑style” tax sub‑bureaus: the Shiqiao Sub‑Bureau in Dachuan District has created an “Online (Cloud) Fengqiao”; the No. 1 Tax Sub‑Bureau of Tongchuan District has jointly developed an “Online + Offline Fengqiao” model; the Tiansheng Tax Sub‑Bureau in Xuanhan County has launched the “Bashan Fengqiao”; the No. 1 Tax Sub‑Bureau of Wanyuan City has built the “Red Fengqiao”; the No. 1 Tax Sub‑Bureau of Qu County has established the “Cang Tax Fengqiao”; the No. 1 Tax Sub‑Bureau of Kaijiang County has created the “Tiancheng Fengqiao”; and the No. 1 Tax Sub‑Bureau of Dazhu has constructed the “Bamboo Rhythm Fengqiao.” Drawing fully on local conditions and highlighting regional cultural characteristics, these sub‑bureaus have been transformed into vanguard outposts and strongholds—delivering tangible results, improving people’s livelihoods, mitigating risks, safeguarding public safety, and invigorating the community.
Digital empowerment: building a robust fortress for source‑level governance.
To address systemic problems, we must tackle them at their root. By strengthening the analysis of the underlying causes of disputes and conflicts, conducting a comprehensive examination of the origins and impacts of each type of tax and fee-related controversy, and establishing targeted, precise policy measures along with rapid response mechanisms and timely feedback channels, we can effectively enhance taxpayers’ and payers’ satisfaction and sense of gain.
“Last month, all three disputes involved tax refund and tax reduction policies. This month, we will focus on prevention, provide targeted guidance to corporate accountants, and issue early warnings.” In Dazhou, the Tongchuan District Tax Bureau systematically reviews and analyzes conflicts and disputes gathered through channels such as referrals from functional departments, feedback from the government hotline, and letters and visits from the public. It has established an “early‑warning barometer,” created a “profile‑based tiered assessment” for enterprises, conducted thorough analysis and evaluation, and thereby ensures early detection of major risks.
“If you have a question, find Xiao Du—no more getting lost!” By fully leveraging the advantages of online outreach, tax‑related policies and regulations are presented to taxpayers and payers in a clear, accessible manner through live tax broadcasts, expanding channels for information access and providing timely answers to complex issues, thereby reducing disputes between tax authorities and taxpayers. The “Xiao Du on Tax” studio has become a powerful tool for dispute resolution and conflict mediation at the Fengqiao‑style tax sub‑bureau in Xuanhan County.
“Following preliminary explorations, we have recognized that, in addition to effectively integrating the resolution of potential disputes with the enhancement of taxpayer satisfaction, it is also essential to leverage tax‑related big data to systematically analyze the root causes and evolving trends of existing disputes, distill successful practices for resolving conflicts at their source, and thereby achieve proactive dispute prevention,” explained Li Lue, Chief of the Legal Affairs Section of the Dazhou Municipal Tax Service Bureau.
Strengthening governance through intelligence and forging ahead with innovation, since establishing the “Fengqiao‑style” tax sub‑bureau, the Dazhou Municipal Tax Authority has consistently leveraged the digital “Smart Tax” platform to precisely identify the root causes of tax‑related disputes. Relying on the “Bashan Tax Talk” livestreaming channel, tax‑enterprise communication platforms, and its official WeChat account, it has conducted broad‑reach tax‑law publicity; meanwhile, through enterprise symposiums and face‑to‑face consultations, it has provided targeted, granular guidance. In addition, it has issued the “Implementation Plan for the Collection and Management of Real Estate Transaction Valuation Data” by the Dazhou Municipal Tax Service Bureau of the State Taxation Administration, thereby facilitating the precise and effective resolution of key issues such as real estate tax administration and invoice usage. To date, the city has successfully resolved 22 real estate tax‑related disputes and 44 invoice‑management conflicts.
Joint collaboration to establish a convenient one-stop platform for dispute resolution.
Tax administration encompasses a wide range of functions, with some tax and fee matters involving multiple departments and requiring seamless coordination across processes. Consequently, how to leverage the strengths of “Fengqiao‑style” tax offices and foster multi‑departmental, one‑stop collaboration to resolve tax and fee disputes has become a key issue for tax authorities nationwide.
“My processing plant has already been reclaimed, so we should no longer be required to pay the farmland occupation tax,” said the head of a crushed‑stone processing plant in Qu County. It turned out that, due to differing interpretations among taxpayers regarding the definition of “reclamation” in the context of farmland occupation tax, disputes had persisted. After identifying that the root of the issue involved multiple agencies, the Qu County tax authorities convened members of the tax‑dispute mediation team and engaged repeatedly with departments such as natural resources, agriculture and rural affairs, and justice. They helped the taxpayer gain a clear understanding of the approval timeline for temporary land use, the timing of the tax liability for farmland occupation, and the relevant liable parties, while thoroughly explaining both the legal principles and the factual circumstances, thereby successfully resolving the dispute.
Vertical coordination and horizontal collaboration are effective approaches for resolving disputes. In recent years, Dazhou City has seized the opportunity presented by joint tax governance to vigorously advance multi‑agency co‑construction, data sharing, and collaborative governance, steadily pushing forward the development of “Fengqiao‑style” tax sub‑bureaus.
In Xuanhan County, taxpayers with high tax credit ratings, public-interest lawyers, full-time attorneys, and community workers have been actively invited to join the mediation team, bolstering its capacity and enhancing the credibility of its work, thereby laying a solid foundation for effectively resolving tax-related disputes at the local level.
In Kaijiang County, proactive coordination has been established with the County People’s Court, the County People’s Procuratorate, the County Justice Bureau, the Letters and Visits Bureau, the Real Estate Transaction Center, and local subdistricts and communities. More than 20 joint working meetings have been convened, and collaborative agreements have been successfully signed with the County People’s Court and the County People’s Procuratorate. This has enabled the full integration of mediation resources and public legal services from judicial administration and tax authorities, forging a new “tax‑plus‑justice” framework and jointly advancing the development of a multi‑faceted system for the prevention, mediation, and resolution of disputes in the tax sector.
In Wanyuan City, a rule-of-law mindset has been deeply integrated into the dispute-resolution system. The city has established mediation rooms, waiting and rest areas, service‑display spaces, new‑media recording studios, and extended office hubs for local sub‑bureaus. In collaboration with judicial authorities and community organizations, it has formed specialized teams, carefully selecting and staffing chief mediators and committee members to ensure smoother communication between tax authorities and taxpayers and to simplify the resolution of complex and intractable issues.
When hearts are united, even metal can be cut; when minds are aligned, the path ahead shines brightly. Under the impetus of concerted efforts, the tax authorities of Dazhou City have continuously refined a multi‑stakeholder governance framework—integrating “tax officers + grid workers,” “sub‑bureaus + county bureaus,” and “internal + external” mechanisms—steadily advancing the effective resolution of tax‑related (fee‑related) disputes and steadily enhancing taxpayer satisfaction, thereby fostering a tax business environment that is fairer, more standardized, and more convenient and efficient. To date, the city’s “Fengqiao‑style” tax sub‑bureaus have provided over 12,000 consultations on tax‑related (fee‑related) issues, resolved more than 9,700 tax and fee matters, and handled 125 tax‑related disputes, achieving a 100% rate of grassroots dispute resolution and a 100% satisfaction rate in mediation.
Dongying Port Economic Development Zone Tax Bureau: A Spectacular Display of the Constitution—Taxation in Action
December 4, 2022, marked the ninth National Constitution Day and the 40th anniversary of the promulgation and implementation of China’s current Constitution. To foster a robust rule-of-law environment and comprehensively enhance public awareness of the Constitution, the Dongying Port Economic Development Zone Tax Bureau of the State Taxation Administration organized activities to bring the Constitution into communities, enterprises, and government agencies, as well as constitutional oath‑taking ceremonies. These initiatives facilitated in-depth study of the Constitution, promoted its spirit, upheld its authority, and encouraged officials and the general public to embrace its principles, thereby strengthening their patriotic sentiments.
“I solemnly swear: to be loyal to the Constitution of the People’s Republic of China, to uphold the authority of the Constitution, and to fulfill my statutory duties…” Recently, the Dongying Port Tax Bureau held a constitutional oath‑taking ceremony for young tax officials at the district level. During the ceremony, under the guidance of the oath‑leader, all participants solemnly took the oath, earnestly expressing their reverence for the Constitution, their dedication to their work, and their commitment to the people.
Since December, the Dongying Port Tax Bureau has organized all tax officials to watch constitutional‑promotion videos under the theme “Watch Videos, Study the Constitution, Share Reflections.” Bureau leaders have taken the lead in studying the full text of the Constitution, engaging in group discussions and sharing insights to grasp its underlying spirit and core principles. Meanwhile, posters and slogans have been posted in the service hall and office‑area bulletin boards, and constitutional‑promotion videos have been continuously broadcast on electronic displays. In addition, the bureau has mobilized key personnel from relevant divisions, adhering to the principle of “who enforces the law, who promotes legal awareness,” and adopted popular, widely appreciated formats to carry out public‑legal‑education activities centered on constitutional promotion and focused on tax laws and regulations. Tax officials have distributed brochures on constitutional knowledge at the tax service counter, actively explained constitutional principles to taxpayers and payers, provided legal services, and conducted legal‑awareness education, thereby enhancing participation and interaction among taxpayers and payers and helping the public feel that the Constitution and the law are readily accessible in their daily lives.
Going forward, the Dongying Port Tax Bureau will continue to intensify efforts to promote constitutional awareness and legal education, enhance its capacity to address issues through rule-of-law thinking and approaches, conscientiously safeguard the authority of the Constitution, fulfill its statutory duties, implement and refine all tax preferential policies, and provide sincere services to taxpayers and payers.
Tai’an Tax Authorities: Ongoing Tax Incentives Continue to Bolster Support, Revitalizing Market Entities
Since the beginning of this year, the Tai’an Municipal Tax Service Bureau of the State Taxation Administration has fully leveraged the tax authorities’ functions, proactively implemented the new package of tax and fee support policies, the comprehensive measures to stabilize the economy, and follow-up policies, and taken a proactive approach to supporting the development of all types of market entities, thereby transforming the benefits of tax‑related policies into new momentum that helps market players achieve steady and sustainable growth.
Policy synergies boost momentum, bolstering confidence in new energy development.
As a specialized sector within new energy materials, equipment, and energy storage, lithium‑ion batteries boast broad prospects for development. In the course of optimizing its supporting and related industries and pioneering a new model of comprehensive resource utilization, Shandong Ruifu Lithium Industry Co., Ltd. has encountered challenges such as tight cash flow and sluggish sales and procurement, which have adversely affected the company’s normal production and operations.
Upon learning of the enterprise’s difficulties, the tax rebate and tax reduction team of the Feicheng Municipal Tax Service Bureau promptly activated its rapid response mechanism. Tailoring personalized service measures to the industry’s specific characteristics, the team established a grid‑based service framework, ensured comprehensive alignment with relevant policies, and provided one‑on‑one guidance to address the enterprise’s tax‑related needs. This approach guarantees that taxpayers’ requests are addressed promptly and their inquiries are answered thoroughly, enabling corporate finance staff to fully understand the policies and master their implementation. At the same time, the bureau has opened a “green channel” for the enterprise, assigning dedicated personnel to oversee each stage—acceptance, review, and approval—to accelerate processing and ensure that businesses can swiftly benefit from tax and fee concessions, thereby promptly resolving funding bottlenecks.
“Since the beginning of this year, thanks to the professional guidance provided by the Feicheng City Tax Bureau, we have cumulatively benefited from corporate income tax and environmental protection tax exemptions and reductions totaling over RMB 10 million. In addition, other preferential policies—such as tax‑exempt income, reduced‑income deductions, and additional deductions under the corporate income tax—have further lowered our taxable income by more than RMB 20 million, significantly easing our financial burden and revitalizing our working capital chain,” said Wang Zhen, Chief Financial Officer of Shandong Ruifu Lithium Industry Co., Ltd.
The Taian tax authorities have introduced innovative, precision‑driven service measures, advancing specialized, industry‑specific, and grid‑based initiatives. By adopting a three‑step approach—preemptive big‑data analysis, cross‑departmental collaborative assessments, and continuous guidance from dedicated expert teams—they are strengthening tailored support, deploying a package of tax and fee relief policies to inject vital resources into enterprises, helping new‑energy companies achieve breakthroughs in core technologies, enhance their market competitiveness, and accelerate the rapid growth of the new‑energy sector.
Refund of outstanding tax credits boosts environmental protection; tax incentives nurture green mountains and clear waters.
Dongping Kangda Water Services Co., Ltd. is responsible for wastewater treatment in the western urban area and the economic development zone of Dongping County. The Dongping County Tax Bureau proactively visited the company to provide guidance on obtaining a value-added tax credit refund totaling over RMB 7.9 million, while also disseminating policy information on energy conservation and environmental protection, actively implementing preferential policies, and encouraging the enterprise to reduce energy consumption, conserve resources, and pursue green development.
“The tax refund of over 7.9 million yuan has promptly addressed the company’s most pressing needs and revitalized its working capital,” said Song Naiqian, General Manager of Dongping Kangda Water Services Co., Ltd. “The tax authorities’ proactive and efficient efforts—particularly the repeated follow-ups and patient guidance provided by tax officials—have not only allowed us to experience the warmth of their service and reap the benefits of favorable policies, but have also filled us with confidence in the company’s future prospects.”
The tax authorities of Tai’an City have fully implemented tax preferential policies for energy conservation, emissions reduction, and pollution prevention, strengthening the role of taxation in ecological protection and environmental governance. By making full use of tax incentives—such as those for high-tech enterprises, the additional deduction for enterprise R&D expenses, and comprehensive resource utilization—they are fostering the robust and sustainable growth of the eco‑environmental industry.
While leveraging the tax system to address environmental pollution, the tax authorities are also focusing on supporting green and low‑carbon enterprises, putting into practice the development philosophy that “lucid waters and lush mountains are invaluable assets.” With a crisp “ding,” Dang Xiangqi, the finance director of Dongping Guodian Investment Sunny New Energy Co., Ltd., received a text message conofficeing the receipt of a VAT credit refund totaling RMB 4.5 million. “The refund arrived quickly and at just the right time—this is the largest single‑transaction refund we’ve received in recent years.”
“Photovoltaic power generation is a high‑investment, high‑cost undertaking. We made substantial upfront investments, but cash flow has been slow, leaving us under significant financial strain. At this critical juncture when we urgently needed working capital, the government’s tax‑support policies came to our aid, enabling us to advance more steadily and further along the new path of green development,” said Liu Jiwu, head of Dongping Guodian Investment Sunny New Energy Co., Ltd.
A coordinated package of measures to ease burdens and stimulate innovation vitality.
“The Ningyang County Tax Bureau has provided us with a comprehensive package of tax reduction and exemption policies. As a high-tech enterprise and an SME, this year we will benefit from multiple support measures, including an additional deduction for R&D expenses, reductions or exemptions on six taxes and two fees, and a preferential tax rate for high-tech enterprises, resulting in total tax and fee relief of 120,000 yuan for the year. The tax authorities have also delivered policy guidance manuals precisely via mobile and desktop platforms, and even come to our premises to address complex issues—truly commendable,” said Wang Hongmin, the financial director of Shandong Jinmao Automation Equipment Co., Ltd.
Shandong Jinmao Automation Equipment Co., Ltd. is a leading enterprise in China’s specialized brick and tile manufacturing machinery sector and currently operates a research and development–focused manufacturing facility dedicated to the design and development of advanced wall‑material equipment.
According to reports, the Taian tax authorities adhere to the principle of “reducing burdens on enterprises while enhancing tax and fee services,” encouraging businesses to increase R&D investment and elevate their technological capabilities. With respect to tax and fee support measures such as deferred VAT refunds, additional deductions for R&D expenses, and reductions or exemptions on six taxes and two fees, the authorities leverage tax‑enterprise communication groups, the Lu Tax Pass platform, and the electronic tax bureau to deliver targeted policy guidance. They also rely on tax‑related big data to provide ongoing monitoring and tailored support, thereby empowering technology‑driven enterprises to become more self‑reliant and resilient.
“Since the beginning of this year, the Taishan District Tax Bureau has processed over RMB 6.6 million in value-added tax credit refunds for us. We have leveraged these funds to intensify our R&D efforts, addressing numerous structural challenges in the textile and apparel industry. We have achieved significant breakthroughs in several cutting-edge and key common‑technology areas, and have issued 15 relevant standards. With the support of national policies and the assistance of the tax authorities, we are confident that we can accelerate research into dyeing and finishing technologies and realize our development goals of ‘technology, fashion, and sustainability,’” said Chen Xia, the financial director of Shandong Zhongkang Guochuang Advanced Dyeing and Finishing Technology Research Institute Co., Ltd.
Litigation & Arbitration

Enable the people to feel a greater sense of fairness and justice.
— A Documentary Record of the Lishui People’s Court in Zhejiang Province’s Steadfast Implementation of the Project to Enhance Public Perception of Judicial Fairness
Fairness and justice are the soul and lifeblood of the judiciary.
In December 2021, the Lishui Municipal Party Committee of Zhejiang Province convened a conference on court work, specifically addressing at the party committee level the advancement of efforts to enhance public perceptions of judicial fairness. Over the past year, the Lishui courts have deeply embraced “perception” as a key concept, aligning with the Zhejiang Provincial Higher People’s Court’s mandate to ensure cases are adjudicated with the greatest fairness, in the shortest possible time, and with the strongest sense of judicial satisfaction among the people. In response to the public’s aspirations for a better life and their expectations for fairness and justice, the courts have vigorously promoted the “Project to Enhance Public Perception of Judicial Fairness.” In May 2022, this project was recognized as a best practice (first batch) within Zhejiang Province’s demonstration zone for high-quality development and common prosperity.
Relying on the leadership and support of the Party Committee
Creating a Better Judicial Environment
“When we encounter complex legal issues during mediation, we can connect with a judge through the ‘Shared Court’ platform, and the judge provides us with one‑on‑one guidance. Moreover, thanks to this new app, our mediation has become even more efficient,” said Yuan Qizhang, Party Secretary of Shang’an Village in Xinxing Town, Songyang County, who also serves as the village’s people’s mediator, expressing his strong appreciation.
The “application” mentioned by Yuan Qizhang refers to a digital use case of the “People’s Court + Shared Court: One-Stop Grassroots Dispute Resolution” reform, which the Lishui Intermediate People’s Court has piloted and promoted in Songyang County. Members of the public can submit their dispute-resolution requests by scanning a QR code or calling a hotline; dispatchers then assign mediators based on proximity, ensuring that all grassroots conflicts and disputes are duly addressed and that, at every stage of resolution, there is always someone to respond and take charge.
Since the app’s launch, a significant number of disputes have been resolved at the township and village levels, enabling residents to address their concerns at little or no cost while also reducing the overall expenses of social governance. From January to November 2022, Lishui City’s litigation rate per 10,000 people declined by 10.55% year over year, with many disputes being settled at an early stage at minimal expense.
“The platform effectively integrates the resources of local Party committees and governments, brings together diverse dispute-resolution mechanisms, and has produced an orderly, visual, and cost‑effective ‘roadmap’ for resolving disputes,” said Chen Jiangang, Deputy Secretary of the Songyang County Party Committee and Secretary of the Political and Legal Affairs Commission, who is responsible for coordinating this reform.
Following the Lishui Municipal Party Committee’s convening of a court work conference, the party committees of nine counties (cities and districts), in light of their respective local conditions, held their own court work conferences on themes such as using the judiciary to advance social governance, optimize the business environment, and overcome challenges in enforcement. This has established a citywide working framework characterized by “party committee leadership and efficient inter‑agency coordination,” resulting in an unprecedented improvement in the city’s judicial environment.
“If disputes can be resolved at the village level, why waste money, time, and effort on litigation?” The people’s call has received a clear response in the report of the 20th National Congress of the Communist Party of China: “Resolve conflicts and disputes promptly at the grassroots level and nip them in the bud.” In Lishui, the local courts have proactively integrated into the grassroots social governance system under the leadership of the Party committees, embedding 2,362 “shared courts”—covering every township and community across the city—into all levels of conflict resolution. This has helped establish a grassroots dispute‑resolution framework characterized by “one core and multiple actors,” with township (subdistrict) Party committees at its center, people’s courts and “shared courts” serving as key platforms, and village committees, co‑building entities, Party members, and the broader public jointly contributing to the process.
“Launching the Project to Enhance Public Perception of Judicial Fairness means relying on the leadership of the Party, upholding the principle of putting the people first, and basing our efforts on the public’s experience—reducing the costs of dispute resolution, improving the litigation process, strengthening public trust in the judiciary, ensuring effective enforcement of judgments, and reinforcing both internal and external oversight—so that the judicial environment and Lishui’s pristine natural landscape of green mountains and clear waters can complement and reinforce one another,” said Zhang Junbin, Secretary of the Party Group and President of the Lishui Intermediate People’s Court.
Focusing on the public’s tangible experiences to create a better judicial experience.
When members of the public bring a case to court, their fundamental aim is to resolve the dispute at hand. The Lishui Intermediate People’s Court, guided by the principles of “the full lifecycle of a case” and “one dispute, one party, one matter,” has restructured its dispute-resolution processes and launched a series of targeted reforms—such as “filing, trial, enforcement, and bankruptcy handled as a single integrated process” and “litigation and mediation managed as a single unified procedure.”
“Small‑scale measures” target “large‑scale scenarios.” The People’s Court of Liandu District, Lishui City, has established a Talent and Technology Protection Tribunal within the Lishui Economic and Technological Development Zone, launching a reform initiative dubbed “One‑Stop Resolution for Talent‑ and Technology‑Related Disputes” to centrally handle civil and commercial cases involving high‑level talent and technology enterprises. In the eight months since its launch, the tribunal has reduced the average case‑handling time by 17.61 days compared with ordinary cases and achieved an automatic compliance rate of 70.34%, 20.2 percentage points higher than that of comparable cases during the same period.
“In the past, I focused more on closing cases and ensuring procedural compliance; now, I place greater emphasis on achieving amicable resolutions and fostering harmony among parties, striving to enable ordinary citizens to receive their due payments without having to initiate enforcement proceedings,” said Chen Junming, a judge at the Lishui Intermediate People’s Court. He acknowledged that this represents his most significant shift since the implementation of the initiative to enhance public perception of judicial fairness. From January to November 2022, the automatic performance rate in Lishui courts rose by 10.85 percentage points year over year, with the automatic performance rate for mediated cases reaching 70.91%.
Qingtian County is a renowned hometown of overseas Chinese, home to 380,000 overseas Chinese and Chinese nationals living in 146 countries and regions worldwide. In the past, disputes involving overseas Chinese often faced protracted resolution processes due to factors such as geographical distance and time‑zone differences. The “One‑Stop Resolution for Overseas‑Chinese‑Related Disputes” reform, however, offers an integrated suite of solutions—including mediation, litigation, and arbitration—alongside centralized support services like inquiry, consultation, notarization, and translation, thereby effectively transforming this situation.
“We want parties to feel that filing a lawsuit in Qingtian is even more convenient and fair than doing so abroad, and through the advantageous position of this hometown of overseas Chinese, we aim to showcase to the world the superiority of China’s socialist judicial system,” said Zhou Xiaolan, Party Secretary and President of the Qingtian County People’s Court.
“Your back may carry a load, but your spine must remain straight.” The Intermediate People’s Court of Lishui has established an enforcement mechanism based on the principle of “courtesy first, force second,” inviting Chen Jinying, the 92-year-old “Grandma of Integrity” and one of the “Top Ten Trustworthy Individuals Nationwide,” to visit its “Shared Court.” There, she shared her story of honoring her word by starting over at age 81 and paying off a debt of 20.77 million yuan, thereby guiding and encouraging those subject to enforcement to voluntarily fulfill their obligations. Her down-to-earth words resonated deeply with many debtors, leading to the successful closure of 935 enforcement cases and the voluntary repayment of more than 39.57 million yuan in outstanding debts.
Jingning She Autonomous County has launched a special campaign across the county titled “Join Forces to Tackle Enforcement Difficulties and Support the New She‑Ethnic‑Group‑Driven Path to Common Prosperity.” Under the leadership of the county Party and government’s top officials, with township Party secretaries taking charge and village and community-level organizations mobilizing at every level, the county has successfully resolved more than 800 long‑pending enforcement cases. Ong Zhihong, Secretary of the Jingning County Party Committee, stated: “When court judgments remain unenforced for extended periods, it not only undermines judicial authority but also damages the local rule‑of‑law environment and business climate. However, addressing enforcement difficulties is not the sole responsibility of the courts; it requires the broad participation of all stakeholders.”
Building on the “Jingning Experience,” the Lishui Municipal Party Committee launched a citywide special campaign titled “Clearing the Final‑Case Database for Enforcement Cases to Enhance Public Perception of Judicial Fairness.” As a result, public understanding, support, and participation in enforcement have reached an unprecedented level, with the consensus across the city that strengthening enforcement is synonymous with improving governance and driving development. Since the launch of this campaign, all 7,654 backlog cases handled by the city’s courts have been fully enforced, with a total of RMB 1.815 billion recovered.
Digital Empowerment Reshapes Transformation, Forging Greater Public Trust in the Judiciary
The report to the 20th National Congress of the Communist Party of China emphasizes that whole-process people’s democracy is an essential attribute of socialist democratic politics and represents the broadest, most genuine, and most effective form of democracy. The Intermediate People’s Court of Lishui has leveraged digital tools to explore and implement whole-process people’s democracy in the judicial field, thereby enhancing public trust in the judiciary and strengthening its authority.
“Judges and local residents speak in the local dialect, and I can’t understand what they’re saying, which inevitably raises suspicions of local protectionism. I hope the judges will communicate in Mandarin.” By scanning the QR code on the “Judicial Justice Online” notice served along with the case file by the Lishui Intermediate People’s Court, a non-local litigant, Mr. He, raised this concern.
In October 2021, the Lishui Intermediate People’s Court developed and launched the “Judicial Justice Online” application, establishing a digital evaluation system that measures public perceptions of judicial fairness from the perspective of the people themselves and placing the “voting mechanism” for assessing judicial justice directly in the hands of the public. The application enables online complaints, suggestions, evaluations, and feedback throughout the entire process and at any time or place, with submissions routed directly to court presidents and division heads, thereby forming a comprehensive closed-loop encompassing oversight by parties and lawyers, trial management oversight, and disciplinary inspection and supervision.
“Only when the public can exercise oversight and engage in direct communication with the parties involved will they truly feel the impact. We have assigned QR codes to documents such as acceptance notices, enabling parties and lawyers to submit their comments, suggestions, and evaluations by scanning these codes. Dedicated case-handling staff will respond within three days, and the supervisory department will conduct comprehensive follow-up visits.” Zhu Hongjie, head of the Research Office of the Lishui Intermediate People’s Court, explained that this initiative also leverages back-end data analysis to identify common issues—such as systemic loopholes and regulatory gaps—thereby providing a robust tool for court and tribunal leaders to strengthen oversight.
The Lishui Intermediate People’s Court has systematically addressed the common issues raised through its “Judicial Justice Online” platform and introduced a set of ten targeted measures—such as “standardizing judicial etiquette” and “strengthening communication during enforcement”—to enhance public perceptions of judicial fairness, earning widespread praise from the public. Since the launch of “Judicial Justice Online,” courts across the city have assigned digital codes to more than 62,000 cases, received 13,013 evaluations and 2,009 suggestions from parties and lawyers, placed 44 “four-category cases” under the focused oversight of court presidents and division heads, and subjected 167 cases to special review. Nine instances of misconduct in judicial conduct were verified and rectified, while the number of letters and visits to citywide courts decreased by 62% year on year. Follow-up telephone surveys indicate that 94% of respondents highly commended the application. At present, “Judicial Justice Online” has been rolled out province-wide by the Zhejiang Higher People’s Court.
“The Lishui People’s Court has focused its efforts on enhancing the public’s sense of judicial fairness, continuously deepening the initiative to improve perceptions of judicial justice and achieving notable results in elevating case quality and efficiency while ensuring that the public can tangibly feel the administration of justice,” said Zhang Yun, Deputy Secretary of the Lishui Municipal Party Committee and Secretary of the Political and Legal Affairs Commission. He added that the court will continue to support and advance this initiative, striving to establish Lishui as a leading hub for the perception of judicial fairness, so that the people may experience fairness and justice more vividly.
Lucheng District, Wenzhou: “Financial Law Service Station” Promotes One-Stop Resolution of Financial Disputes
“Here, we can instantly access the latest industry insights and stay abreast of emerging risk trends.” Inside the Wenzhou International Financial Center, a bank employee engaged in a dialogue with a judge via the “Shared Court” platform. Recently, the People’s Court of Lucheng District, Wenzhou City, Zhejiang Province, in collaboration with the Lucheng District Financial Office and the Lucheng Rural Commercial Bank, officially launched the “Financial Law Service Station” at the Wenzhou International Financial Center.
On the left side of the “Financial Law Station,” the daily Wenzhou Private Financing Composite Interest Rate Index is displayed, serving as an “indicator” for the private financing market; on the right, typical cases of financial disputes are presented, providing a “barometer” for the legal conduct of commercial and civil entities.
“Financial Law Station” comprises three exhibition halls—the Financial Reform Hall, the Financial Security Hall, and the Financial Justice Hall—along with a “Shared Court” service station. In the Financial Reform Hall, visitors can interact with a digital reform wall via smart devices, revisiting Wenzhou’s decade-long history of financial reform. The Financial Security Hall showcases measures for controlling financial risks and highlights cases of non‑compliant practices by financial institutions, aiming to enhance their capacity for sound decision‑making and risk management. The Financial Justice Hall, grounded in the judiciary’s commitment to serving the public, is dedicated to providing one‑stop, multi‑channel dispute resolution for financial and commercial matters. On the one hand, courts leverage the “Shared Court” platform to conduct remote, online pre‑litigation mediation guidance, file cases electronically, and hold model court sessions; they also collaborate with financial institutions and industry associations to promote source‑based dispute resolution and establish a government‑court coordination mechanism with the Lucheng District Government to jointly anticipate, prevent, and manage risks while refining the financial evaluation system. On the other hand, this area plays an educational role by disseminating legal knowledge through case studies, encouraging parties to comply voluntarily and upholding the principles of honesty and trustworthiness.
“Lucheng District is the main hub for the development of Wenzhou’s financial sector. The establishment of the ‘Financial Law Service Station’ is of great practical significance, as it will further strengthen collaboration among the government, the courts, and financial institutions, enrich the channels for disseminating knowledge on financial risk prevention, and enhance the effectiveness of public legal education in the financial field,” said Zhou Min, Deputy District Mayor of Lucheng District.
Typical Cases of the People’s Courts and Procuratorial Organs Punishing Crimes Endangering Production Safety in Accordance with the Law
　“A single case is worth more than a dozen documents.” To fully leverage the guiding role of typical cases in handling criminal cases involving threats to production safety and to further clarify issues related to the application of relevant laws, the Supreme People’s Court and the Supreme People’s Procuratorate, drawing on their accumulated experience in judicial practice, have released six typical cases of crimes endangering production safety. These include: the case of Yang Mouqiang et al. involving a major accident due to negligence, forgery of official documents, and bribery; the case of Li Mou, Wang Mouhua, Jiao Moudong et al. involving coercion to engage in unlawful and hazardous operations and a major accident due to negligence; the case of Jiangsu Tianmou Safety Technology Co., Ltd. and Bai Mou et al. involving the provision of false certification documents; the case of Gao Mouhai et al. involving dangerous operations; the case of Li Mouyuan involving dangerous operations; and the case of Zhao Moukuan and Zhao Moulong, where no prosecution was pursued for dangerous operations.
In the case involving Yang Mouqiang and others for serious accidents caused by negligence, forgery of official documents, and bribery, it is clearly stipulated that illegal and non‑compliant practices in construction—such as unlicensed construction, unlawful alterations or expansions, unauthorized additional stories, and unauthorized changes to a building’s functional layout and structural configuration—must be severely punished. In particular, those who bear primary responsibility for causing building collapses or other catastrophic accidents shall receive the maximum penalty within the statutory sentencing range, thereby fully reflecting the policy orientation of rigorously cracking down on crimes endangering production safety. The cases of Li Mou, Wang Mouhua, Jiao Moudong, and others for compelling unlawful and hazardous operations and for serious accidents caused by negligence further clarify the criteria for conviction and sentencing under the crime of compelling unlawful and hazardous operations. Even where the individuals bearing organizational, commanding, or managerial responsibilities in production or operations have not resorted to intimidation, coercion, or threats, they may still be found guilty of this offense if they abuse their authority to compel others to engage in unlawful activities. As for frontline workers who are compelled by others to undertake such unlawful and hazardous tasks, their criminal liability shall be determined in accordance with the law, taking into account the degree of compulsion they endured and the extent to which their respective actions contributed to the occurrence of the accident. The case involving Jiangsu Tianmou Safety Technology Company, Bai Mou, and others for providing false certification documents makes clear that when intermediary organizations fabricate facts and submit falsified documentation, thereby preventing the timely identification of significant risks and potential hazards at enterprises and interfering with or misleading the regulatory work of relevant authorities, such conduct constitutes the crime of providing false certification documents under the law. When determining the appropriate sentence for these intermediary organizations and their personnel, courts must comprehensively consider factors including the methods employed, the degree of subjective fault, the extent of their role in causing the safety incident, as well as their profits and past conduct, so as to assess the overall social harm and impose a proportionate punishment in accordance with the Criminal Law.
Furthermore, to clarify the criteria for determining “a real risk of causing major casualties or other serious consequences” in the crime of hazardous operations and to provide guidance for judicial practice, three typical cases involving this offense—namely, the case of Gao Mouhai and others, the case of Li Mouyuan, and the non-prosecution case of Zhao Moukuan and Zhao Moulong—have been specifically selected and released. These cases further delineate the specific standards for assessing whether a particular production activity, such as the handling of hazardous chemicals or mining operations, poses a real risk of resulting in major casualties or other grave consequences. On the one hand, crimes involving hazardous operations must be punished in accordance with the law, with strict enforcement where warranted, so as to effectively safeguard workplace safety and the lives and property of the public. On the other hand, the criminal policy of combining leniency with severity should be fully implemented, ensuring the comprehensive, accurate, and standardized application of the criminal justice policy of minimizing arrests, cautious prosecution, and prudent detention. Where the offender admits guilt and accepts punishment, and the circumstances of the offense are minor enough that a criminal sentence is unnecessary, non-prosecution or exemption from criminal punishment may be applied. At the same time, efforts should be strengthened to enhance coordination and collaboration with administrative regulatory authorities, such as those responsible for emergency management, to continuously advance root-cause‑based governance and ensure effective case handling.
Typical Cases of the People’s Courts and Procuratorial Organs Punishing Crimes Endangering Production Safety in Accordance with the Law
1. Case of Yang Mouqiang and others involving a major liability accident, forgery of official documents of state organs, and bribery
2. Case of Li, Wang Mouhua, Jiao Moudong, and others for compelling unlawful and hazardous operations, resulting in a major accident due to negligence.
3. Case of Jiangsu Tianmou Safety Technology Co., Ltd., Bai Mou, and others for providing false certification documents
4. Case of Dangerous Operations Involving Gao Mouhai and Others
5. Li Mouyuan’s Case of Dangerous Operations
6. Non-Prosecution Case of Zhao Moukuan and Zhao Moulóng for Dangerous Operations

Case 1
Case of Yang Mouqiang and others involving a major liability accident, forgery of official documents, and bribery.
——Severely punish, in accordance with the law, those primarily responsible for production safety accidents.
I. Basic Facts of the Case
The defendant, Yang Mouqiang, male, Han ethnicity, born on February 23, 1955, is the operator and de facto controller of a certain hotel in Licheng District, Quanzhou City, Fujian Province.
The identities of the other defendants are omitted.
In 2012, Yang Mouqiang commenced construction of a four‑story steel‑structure building in Licheng District, Quanzhou City, Fujian Province, without obtaining the requisite planning or construction permits. During this period, he subcontracted the project—on a turnkey basis, including both labor and materials—to individuals lacking qualifications to perform steel‑structure work, and commissioned others to use substandard construction drawings and a forged “Construction Project Construction Permit” to fraudulently secure fire‑safety design filing procedures from the public security authorities. In the second half of 2016, again without completing basic construction formalities or obtaining the necessary approvals, Yang Mouqiang subcontracted the same building—on a turnkey basis—to others for the construction of a steel‑structure mezzanine floor, thereby illegally adding an extra level and expanding the structure to seven stories. In November 2017, Yang Mouqiang leased floors three through six of the building to others for use as a hotel, and, in collusion with others, employed falsified documents—including a counterfeit “Fire Safety Inspection Certificate” and a “Real Estate Ownership Certificate”—to unlawfully obtain a “Special Industry License” for the hotel. In mid‑January 2020, Yang Mouqiang hired workers to renovate a ground‑floor storefront. The workers discovered deformation in a load‑bearing steel column and reported it to Yang Mouqiang, who instructed them not to disclose the issue and suspended construction. He subsequently agreed with the contractor on a reinforcement plan; however, due to the inability to secure workers during the Spring Festival period, no reinforcement was carried out. On March 5 of the same year, he then engaged unqualified personnel to illegally weld and reinforce the building’s load‑bearing steel columns. At 5:45 p.m. on March 7, the hotel tenant telephoned Yang Mouqiang to report that glass in the lobby had shattered. Yang Mouqiang inspected the scene and departed. At 7:04 p.m. and 7:06 p.m. that day, two hotel tenants arrived at the site one after another and observed cracks in the lobby wall paneling, which continued to worsen. They again notified Yang Mouqiang by phone. At 7:11 p.m., Yang Mouqiang arrived to inspect the situation. The hotel tenants called for staff to go upstairs and initiate evacuation, but the opportunity to escape had already been missed. At 7:14 p.m., the building collapsed suddenly, resulting in 29 fatalities, 50 injuries of varying severity, and direct economic losses totaling RMB 57.94 million. According to the accident investigation team’s findings, the hotel and other entities involved, along with their de facto controller Yang Mouqiang, disregarded applicable laws and regulations, engaged in illegal construction and operations, fraudulently obtained administrative permits, and failed to implement safety responsibilities over an extended period—factors that constituted the primary causes of the accident.
It was further ascertained that, between 2012 and 2019, Yang Mouqiang, in the course of constructing the building housing the hotel, completing the relevant fire‑safety filing procedures, and applying for the hotel’s Special Industry License, sought to obtain improper benefits by, either alone or in collusion with others, offering property to state functionaries.
II. Outcome of the Handling
The People’s Procuratorate of Fengze District, Quanzhou City, Fujian Province, brought public prosecution against Yang Mouqiang on charges of committing a major liability accident, forging official documents, and bribery, and against the other defendants on charges of committing a major liability accident, providing false certification documents, forging official documents, and forging seals of companies and enterprises. After trial, the People’s Court of Fengze District, Quanzhou City, held that Yang Mouqiang violated safety management regulations by hiring unqualified personnel without lawful construction permits, illegally constructing and renovating a steel‑structure building, and unlawfully organizing renovation work and welding‑reinforcement operations, thereby causing a serious accident resulting in significant casualties and severe economic losses. His conduct constituted the crime of a major liability accident, with particularly egregious circumstances. Furthermore, acting alone or in collusion with others, he forged official documents to fraudulently obtain fire‑safety registration and special‑industry license approvals, allowing safety hazards in the illegally constructed building to persist for an extended period, seriously undermining the credibility and public trust in state organs and ultimately leading to the grave consequences of this case. His actions thus amounted to the crime of forging official documents, with serious circumstances. In addition, seeking improper gains, he individually or jointly with others offered property to state functionaries, enabling the illegal construction and operation of the buildings and hotel involved to continue unchecked, eventually culminating in a collapse with adverse social repercussions. His conduct therefore constituted the crime of bribery, with serious circumstances, and should be punished cumulatively in accordance with the law. Accordingly, Yang Mouqiang was sentenced to nine years’ imprisonment and fined RMB 2 million for forging official documents; eight years’ imprisonment and fined RMB 200,000 for bribery; and seven years’ imprisonment for the crime of a major liability accident. The court decided to impose a total sentence of twenty years’ imprisonment and a fine of RMB 2.2 million. The other defendants were likewise sentenced to appropriate penalties in accordance with the law. Following the first-instance judgment, Yang Mouqiang and the other defendants filed appeals. The Intermediate People’s Court of Quanzhou City ruled to dismiss the appeals and uphold the original verdict.
III. Typical Significance
For some time now, building collapses and structural failures—often resulting from illegal or non‑compliant construction—have occurred with alarming frequency. In certain cases, these incidents have caused significant casualties and substantial property damage, prompting strong public concern. Judicial authorities must intensify their efforts to crack down on such unlawful and criminal conduct, imposing strict legal penalties for violations such as unlicensed construction, unauthorized alterations or expansions, arbitrary additional storeys, and unauthorized changes to a building’s functional layout and structural configuration. Where such acts endanger public safety and constitute criminal offenses, perpetrators must be held strictly accountable under the law. In particular, those who bear primary responsibility for building collapses and are found to have committed crimes such as the crime of major liability accidents—crimes that jeopardize workplace safety—should receive the maximum possible sentence within the statutory range, thereby fully reflecting the overarching policy of stringent punishment for offenses that threaten production safety and effectively safeguarding the lives and property of the people.
Case 2
Li, Wang Mouhua, Jiao Moudong, and others
Case of Forcing Violation‑Compliant and Risky Operations and Major Liability Accidents
——Accurately determining the crime of compelling unlawful and hazardous operations
I. Basic Facts of the Case
The defendant, Li, male, Han ethnicity, born on February 24, 1981, is the de facto operator and person in charge of a transportation company in Wuxi, Jiangsu Province.
The defendant, Wang Mouhua, male, Han ethnicity, born on June 13, 1983, is a driver employed by a transportation company in Wuxi, Jiangsu Province.
The defendant, Jiao Mou-dong, male, Han ethnicity, born on October 13, 1972, is a driver employed by a transportation company in Wuxi, Jiangsu Province.
The identities of the other defendants are omitted.
In September 2014, Li established a transportation company in Wuxi, Jiangsu Province, engaging in freight‑transport services. He served as the company’s de facto operator and principal officer, assuming full responsibility for its management and operations. In April 2019, Wang Mouhua was hired as a driver for the company; by late June of the same year, he entered into a partnership with Li to purchase a heavy semi‑trailer tractor, license plate Su BQ7191, coupled with a heavy flatbed semi‑trailer, license plate Su BG976, agreeing to split profits equally. Wang Mouhua drove this vehicle on a daily basis. In late May 2019, Jiao Moudong was also recruited as a driver, operating a heavy semi‑trailer tractor, license plate Su BX8061, coupled with a heavy flatbed semi‑trailer, license plate Su BZ030. In violation of laws and regulations prohibiting overloading, Li explicitly informed prospective drivers during recruitment that the company sought individuals capable of handling “heavy loads” (i.e., severe overloads). Drivers agreed to join only if they could operate such overloaded vehicles. After acquiring trucks without tires, Li arranged for specialized personnel to install steel‑wire tires—whose registration details did not match the vehicle’s official records but offered superior load‑bearing capacity—and to retrofit water tanks designed to cool brakes and tires. These modifications illegally enhanced the cargo‑carrying capacity of the company’s vehicles. During its operation, the company’s vehicles were repeatedly detected by transport authorities for overloading. The company faced administrative warnings for overloading and was held civilly liable for traffic accidents caused by such violations. Despite these incidents, Li continued to direct and manage his drivers to maintain severe overloads, even dismissing drivers who suggested reducing the amount of excess cargo. On October 10, 2019, at the company’s instruction, Wang Mouhua and Jiao Moudong proceeded to a port to load goods. That afternoon, Jiao Moudong drove the heavy semi‑trailer tractor, license plate Su BX8061, towing the heavy flatbed semi‑trailer, license plate Su BZ030 (rated capacity 32 tons), and departed the port after loading seven coils totaling 157.985 tons. Subsequently, Wang Mouhua drove the heavy semi‑trailer tractor, license plate Su BQ7191, towing the heavy flatbed semi‑trailer, license plate Su BG976 (rated capacity 29 tons), leaving the port with six coils weighing a combined 160.855 tons. Around 6:00 p.m. that day, as Jiao Moudong and Wang Mouhua successively traversed the left‑hand lane of an overpass on National Highway 312, the bridge deck suddenly collapsed to one side, blocking the roadway below. At the time of the accident, Jiao Moudong had just cleared the section of the overpass where the collapse occurred, while Wang Mouhua was driving through the same section. His vehicle skidded along the collapsed portion of the bridge and came to rest against the guardrail, resulting in injuries to Wang Mouhua. The accident caused vehicles traveling on the collapsed section of the bridge to plunge downward, while those passing beneath the bridge were crushed, leading to three fatalities and varying degrees of damage to nine motor vehicles. An appraisal determined that the destroyed bridge was valued at approximately RMB 2,422,567, and the nine damaged vehicles incurred total losses of RMB 229,015. According to the investigation team’s findings, the direct cause of the accident was the severe overloading of the two heavy flatbed semi‑trailers, coupled with their close proximity (resulting in a relatively concentrated distribution of weight). The destabilizing effect of the eccentric load far exceeded the stabilizing capacity of the bridge’s superstructure, causing failure of the bearing system and inducing relative sliding and rotational movement between the girders and piers. This ultimately led to lateral slippage and overturning of the girders, which then struck the ground. Following the accident, Jiao Moudong voluntarily surrendered to public security authorities and truthfully confessed to his crimes.
II. Outcome of the Handling
The People’s Procuratorate of Xishan District, Wuxi City, Jiangsu Province, instituted public prosecution against Li Mou for the crime of compelling others to undertake hazardous operations in violation of regulations, and against Wang Mouhua, Jiao Moudong, and the other defendants for the crime of major liability accident. After trial, the People’s Court of Xishan District, Wuxi City, held that Li Mou, fully aware of existing safety hazards and the dangers posed by continuing operations, nevertheless violated relevant safety management provisions and, abusing his authority over organization, command, and management, forcibly compelled others to engage in unlawful work, thereby causing a serious accident resulting in significant casualties; his conduct thus constituted the crime of compelling others to undertake hazardous operations in violation of regulations, with particularly egregious circumstances. Wang Mouhua and Jiao Moudong, during production and operations, likewise violated applicable safety management regulations, leading to a major accident causing serious casualties; their actions each amounted to the crime of major liability accident, also characterized by particularly grave circumstances. Li Mou had already identified safety hazards but, despite repeated warnings from the competent authorities, failed to take corrective measures, warranting a heavier penalty at the court’s discretion; Jiao Moudong, having voluntarily surrendered himself, was granted a lighter sentence in accordance with the law. Accordingly, pursuant to Article 134, Paragraph 2 of the Criminal Law of the People’s Republic of China, as amended by the Sixth Amendment to the Criminal Law of the People’s Republic of China in 2006, Li Mou was sentenced to seven years’ imprisonment for the crime of compelling others to undertake hazardous operations in violation of regulations; Wang Mouhua and Jiao Moudong were respectively sentenced to three years and six months, and three years and three months’ imprisonment for the crime of major liability accident. The remaining defendants were likewise sentenced in accordance with the law. Following the first-instance judgment, Li Mou, Wang Mouhua, and Jiao Moudong filed appeals; subsequently, during the second-instance proceedings, Li Mou and Wang Mouhua applied to withdraw their appeals. The Intermediate People’s Court of Wuxi City ruled to grant Li Mou and Wang Mouhua’s request to withdraw their appeals, while dismissing Jiao Moudong’s appeal and upholding the original judgment.
III. Typical Significance
Personnel who bear organizational, command, or managerial responsibilities for production or operations, driven by the pursuit of exorbitant profits and other motives, knowingly disregard existing safety hazards and, against the subjective will of production and operational workers, compel them to engage in unlawful and hazardous work. Such conduct is highly likely to result in serious accidents, poses significant social harm, and therefore warrants strict punishment. Article 134, Paragraph 2 of the Criminal Law, added by the Sixth Amendment to the Criminal Law, establishes the crime of compelling unlawful and hazardous operations; Article 5 of the Interpretation by the Supreme People’s Court and the Supreme People’s Procuratorate on Several Issues Concerning the Application of Law in Handling Criminal Cases Involving Endangerment of Production Safety provides an exhaustive enumeration of the methods constituting this offense. The Eleventh Amendment to the Criminal Law further expands the scope of conduct covered under Article 134, Paragraph 2, revising the charge to “compelling or organizing others to engage in unlawful and hazardous operations.” In practice, even where personnel with organizational, command, or managerial duties do not resort to intimidation, coercion, or threats, if they nonetheless abuse their authority to compel others to perform unsafe work, such conduct may still constitute the crime of compelling unlawful and hazardous operations (i.e., compelling others to engage in unlawful and hazardous operations). As for frontline production and operational workers who are compelled by others to undertake unlawful and hazardous tasks, their criminal liability shall be determined in accordance with the law, taking into account the degree of compulsion they have endured and the extent to which each party’s conduct contributed to the occurrence of the accident.
Case 3
Jiangsu Tianmou Safety Technology Company, Bai Mou, and others
Case of Providing False Certification Documents
——Punishing Crimes Committed by Safety Assessment Intermediary Organizations in Accordance with the Law
I. Basic Facts of the Case
The defendant, Jiangsu Tianmou Safety Technology Co., Ltd. (hereinafter referred to as Jiangsu Tianmou Safety Technology Co., Ltd.).
The defendant, Bai, male, Han ethnicity, born on April 25, 1982, is a safety assessor at Jiangsu Tianmou Safety Technology Company.
The identities of the other defendants are omitted.
A chemical company in Xiangshui, Jiangsu Province, is a legally registered enterprise. During its production process, it unilaterally altered its manufacturing procedures to precipitate nitration waste from wastewater and deliberately concealed this waste, storing it in large quantities over an extended period in facilities such as coal sheds and old solid-waste storage areas that lacked proper safety‑storage conditions. Jiangsu Tianmou Safety Technology Co., Ltd., which holds Class‑A qualifications as a national safety‑evaluation agency, failed to conduct thorough or in‑depth inspections when carrying out safety‑evaluation services on behalf of the chemical company. It assigned only one safety‑evaluator, Mr. Bai, to perform on‑site investigations—and in some cases, did not dispatch any personnel at all—yet proceeded to prepare the safety‑evaluation report. Mr. Bai did not verify or trace the nitration process flow provided by the chemical company and intentionally drafted a false report. Meanwhile, other members of the project team signed the report without actually fulfilling their obligations, such as conducting on‑site surveys. As a result, the company issued four falsified safety‑evaluation reports—covering 2013 and 2016, a major‑hazard‑source safety assessment in 2016, and a resumption‑of‑production safety evaluation in 2018—all of which seriously deviated from the actual conditions. The company collected a total of RMB 170,000 in fees, thereby allowing the chemical company’s underlying safety risks and hazards to remain undetected and unaddressed for an extended period. At approximately 2:48 p.m. on March 21, 2019, a massive quantity of nitration waste stored in the company’s old solid‑waste storage facility spontaneously ignited due to accumulated heat, triggering an explosion that killed 78 people, severely injured 76 others, hospitalized 640 individuals, and caused direct economic losses amounting to RMB 198,635.07. According to the accident investigation team’s findings, the intermediary agency engaged in fraud and issued false and inaccurate documents, preventing the timely identification of the significant risks and potential hazards associated with the company’s nitration waste and misleading and obstructing the regulatory oversight efforts of the relevant authorities. This constituted a key contributing factor to the accident. Following the incident, Mr. Bai voluntarily turned himself in after receiving a telephone notification and truthfully confessed to his crimes.
II. Outcome of the Handling
The People’s Procuratorate of Funing County, Jiangsu Province, instituted public prosecution against Jiangsu Tianmou Safety Technology Company and defendant Bai Mou, among others, on charges of the crime of providing false certification documents. After trial, the People’s Court of Funing County held that Jiangsu Tianmou Safety Technology Company, as an intermediary organization entrusted with safety assessment duties, intentionally provided false certification documents under serious circumstances, thereby constituting the crime of providing false certification documents; moreover, Bai Mou, as another directly responsible person for the company’s commission of this crime, likewise committed the offense. Taking into account Bai Mou’s voluntary self-surrender, a lighter punishment was imposed in accordance with the law. Accordingly, pursuant to Article 229, Paragraph 1, of the Criminal Law of the People’s Republic of China, as revised in 1997, Jiangsu Tianmou Safety Technology Company was sentenced to a fine of RMB 300,000, and Bai Mou was sentenced to three years and six months’ imprisonment, together with a fine of RMB 25,000. The remaining defendants were each handed down appropriate penalties in accordance with the law. Following the first-instance judgment, Jiangsu Tianmou Safety Technology Company and defendant Bai Mou, along with other defendants, filed appeals. The Intermediate People’s Court of Yancheng City, Jiangsu Province, ruled to dismiss the appeals and uphold the original verdict.
III. Typical Significance
With the development of the market economy, intermediary organizations are playing an increasingly important role. Safety‑evaluation intermediary organizations, upon receiving commissions to conduct safety‑evaluation activities and issue safety‑evaluation reports, play a pivotal role in determining whether production and business entities can obtain approval and permits from the competent safety‑production regulatory authorities and whether they may engage in production and business operations. They are obligated to perform their duties in accordance with the law and to issue truthful, objective safety‑evaluation reports; otherwise, they may incur criminal liability. When adjudicating criminal acts involving the provision of false certification documents by safety‑evaluation intermediary organizations and their personnel, judicial authorities should, in exercising sentencing discretion, comprehensively consider such factors as the methods employed, the degree of subjective fault, the extent of the role played in causing safety accidents, the amount of illicit gains, and the individual’s prior conduct, so as to assess the overall social harm and impose penalties in accordance with the provisions of the Criminal Law, thereby ensuring that punishment is commensurate with the offense.
Case 4
Case of Dangerous Operations Involving Gao Mouhai and Others
— Implementing the criminal policy of combining leniency with strictness, and punishing, in accordance with the law, crimes involving the illegal operation and storage of hazardous chemicals.
I. Basic Facts of the Case
The defendant, Gao Mouhai, male, Han ethnicity, born on October 30, 1984.
The person not prosecuted, Xiong Mouhua, male, Han ethnicity, born on September 6, 1967.
The person not prosecuted, Xiong Jia, male, Han ethnicity, born on March 19, 1987, is the son of Xiong Mouhua.
The person not prosecuted, Xiong Yi, male, Han ethnicity, born on April 14, 1988, is the son of Xiong Mouhua.
Starting in June 2021, Gao Mouhai, seeking illicit profits, rented—without authorization from the relevant authorities—a self-built house owned by Xiong Mouhua, located at No. 136, Shuiyan Group, Bian Shan Village, Shawen Town, Baiyun District, Guiyang City, Guizhou Province, and illegally stored and sold gasoline. Subsequently, Xiong Mouhua, Xiong Jia, and Xiong Mouyi, recognizing the potential for profit, purchased the gasoline stored by Gao Mouhai, repackaged it, and resold it, pocketing the price difference. On December 13 of the same year, around 8:00 p.m., improper handling by Gao Mouhai triggered a gasoline explosion, resulting in severe burns to his face and multiple limbs, as well as partial destruction of his Buick car and the building used for storing the gasoline.
II. Outcome of the Handling
The Baiyun Branch of the Guiyang Municipal Public Security Bureau in Guizhou Province initiated a criminal investigation against Gao Mouhai, Xiong Mouhua, Xiong Jia, and Xiong Yi on suspicion of the crime of dangerous operations, subsequently transferring the case to the Baiyun District People’s Procuratorate of Guiyang for review and prosecution. After examination, the Baiyun District People’s Procuratorate determined that Gao Mouhai, Xiong Mouhua, Xiong Jia, and Xiong Yi violated safety management regulations by engaging, without obtaining the requisite approvals or permits, in highly hazardous production activities such as the operation and storage of dangerous goods, thereby causing an accident and posing a real risk of serious casualties. Their conduct thus met the constitutive elements of the crime of dangerous operations. Xiong Mouhua, Xiong Jia, and Xiong Yi participated in the offense for a relatively short period, primarily providing the premises and assisting in the repackaging and sale of gasoline; they are first-time offenders who have pleaded guilty and accepted punishment, and their offenses are minor. Accordingly, the procuratorate decided not to prosecute Xiong Mouhua, Xiong Jia, and Xiong Yi, while bringing public prosecution against Gao Mouhai for the crime of dangerous operations. The Baiyun District People’s Court of Guiyang sentenced Gao Mouhai to seven months’ imprisonment for the crime of dangerous operations. Following the pronouncement of the verdict, no appeal or protest was filed, and the judgment has thus become final.
III. Typical Significance
According to the “Catalogue of Hazardous Chemicals (2015 Edition),” gasoline is classified as a hazardous chemical. Pursuant to Article 33 of the “Regulations on the Safety Management of Hazardous Chemicals,” the state implements a licensing system for the operation of hazardous chemicals; no entity or individual may engage in such activities without a valid license. The sale and storage of gasoline must be conducted with the requisite permits and licenses, and operators must undergo specialized training and adhere to standardized procedures. Furthermore, facilities storing gasoline must meet applicable safety requirements. In handling specific cases, when an offender, lacking professional training, operating without the necessary business qualifications, without specialized equipment, without adequate safe‑storage conditions, and without emergency response capabilities, unlawfully undertakes highly dangerous production, business, or storage activities involving hazardous materials in the vicinity of residential buildings—resulting, through improper operations, in severe burns to the offender himself and the destruction of surrounding property—the court may, taking into account the manner of the conduct, the location of the incident, and the resulting harm, determine that such conduct constitutes the “real danger of causing major casualties or other serious consequences” under Article 134‑1 of the Criminal Law, which criminalizes dangerous operations. At the same time, due consideration should be given to distinguishing among participants: those who provided facilitating conditions or engaged in repackaging for profit may, after weighing their role in the joint offense and factors such as their admission of guilt and acceptance of punishment, be subject to a decision not to prosecute, thereby reflecting the criminal policy of combining leniency with strictness.
Case 5
Li’s Case of Dangerous Operations
——The Threshold for Determining “Realistic Danger” in the Context of Shutting Down Fire Safety Equipment
I. Basic Facts of the Case
The defendant, Li Mouyuan, male, Han ethnicity, born on October 9, 1975, is the person in charge of Ya某 Hotel Supplies Co., Ltd. of Yongkang City, Zhejiang Province (hereinafter referred to as Ya某 Company).
In 2020, Company Ya installed combustible gas detectors in production areas such as the paint warehouse and the hazardous waste warehouse to ensure workplace safety. Since October 2021, Li Mouyuan, fully aware that disabling these detectors would prevent real-time monitoring of combustible gas concentrations released during production and create a serious safety hazard, unilaterally shut them down in order to cut production costs. On May 10, 2022, a fire broke out in one of Company Ya’s operational areas. Between May 16 and 17 of the same year, a fire department inspection revealed that the company had improperly deactivated its combustible gas detection system and other issues compromising workplace safety. Furthermore, within the area where the detectors had been disabled, authorities discovered large quantities of paints and thinners, including ten drums of Langge-brand odor‑removing primer hardener, sixteen drums of Shoubang Paint A2 hardener, and sixteen drums of Shoubang Paint Five‑Part Matte Wear‑Resistant Glossy Topcoat. The authorities therefore ordered the company to immediately rectify these deficiencies and referred the case to the Yongkang Municipal Public Security Bureau. Testing conofficeed that the aforementioned topcoats and hardeners are flammable liquids and thus classified as hazardous chemicals.
II. Outcome of the Handling
Relying on its data‑application platform, the People’s Procuratorate of Yongkang City, Zhejiang Province, identified through big‑data screening that the case of Li Mouyuan’s dangerous operations, referred by the fire department to the public security authorities, had never been formally filed. Upon further review of the relevant case files, the procuratorate determined that Li Mouyuan’s conduct constituted a suspected crime of dangerous operations and, in accordance with the law, requested the public security organs to explain their reasons for failing to file the case. Following a re‑examination, the Yongkang Municipal Public Security Bureau decided to institute a criminal investigation; the very next day, a follow‑up on-site inspection of Ya Company revealed that, although the company had removed hazardous chemicals such as clear‑coat varnish and curing agents from its warehouse, the combustible gas detection alarm remained deactivated. The Yongkang Municipal Public Security Bureau subsequently transferred the case—alleging that Li Mouyuan had committed the crime of dangerous operations—to the People’s Procuratorate of Yongkang City for review and prosecution.
After review, the People’s Procuratorate of Yongkang City concluded that Li Mouyuan’s unauthorized shutdown of the combustible gas alarm system posed a real and imminent risk of causing serious casualties or other grave consequences. First, disabling the combustible gas alarm system creates a significant safety hazard. The Code for Fire Protection Design of Buildings (2018 edition) explicitly stipulates that areas within buildings where combustible gases or vapors may be emitted must be equipped with combustible gas detection and alarm systems. Although a combustible gas alarm was installed at the scene in accordance with regulations, after learning that an excessive concentration of combustible gas would trigger the alarm, Li Mouyuan, in order to cut production costs, failed to promptly take measures to reduce the gas concentration; instead, he directly shut down and deactivated the alarm, thereby exposing the enterprise’s operations to a substantial safety risk. Second, the “danger” is both real and present. At the site, in addition to three cylinders of bottled liquefied petroleum gas— one of which was in use—there were also large quantities of hazardous chemicals such as paints and curing agents, as well as several tons of paint sludge and other hazardous waste. Furthermore, the workshop’s painting processes generate substantial volatile flammable gases; should these encounter an open flame or reach a critical concentration threshold, a fire or explosion could occur. Third, the “danger” is urgent. Prior to the incident, the factory premises had already experienced a fire, indicating that a minor accident had indeed occurred. The reason no major casualties or other severe consequences ensued was simply that, during the period when a serious hazard arose, the painting workshop had been suspended for several consecutive days, keeping the relevant area’s combustible gas concentration below the critical threshold, and the fire was detected early and extinguished swiftly—an outcome attributable to fortunate chance rather than any inherent safety improvements. Following a fire inspection, authorities immediately identified specific fire safety hazards, including the unauthorized deactivation of the combustible gas alarm system; however, Li Mouyuan persistently failed to rectify these deficiencies. Accordingly, the People’s Procuratorate of Yongkang City instituted public prosecution against Li Mouyuan on charges of dangerous operations. The People’s Court of Yongkang City convicted Li Mouyuan of dangerous operations and sentenced him to eight months’ imprisonment. No appeal or protest was filed after the verdict, and the judgment has thus become final.
III. Typical Significance
According to Article 134‑1 of the Criminal Law, the “real danger of causing major casualties or other serious consequences” in the crime of hazardous operations refers to an objectively existing, imminent hazard that, if not promptly eliminated and allowed to persist, could at any time result in major casualties or other grave outcomes. In judicial practice, whether such a situation constitutes “real danger of causing major casualties or other serious consequences” must be assessed comprehensively, taking into account specific factors such as the industry’s characteristics, the objects of the conduct, the on-site environment, the severity of the violation, and the timeliness and effectiveness of corrective measures. When handling specific cases, judicial authorities must accurately interpret the legislative intent; where the perpetrator has shut down or sabotaged monitoring, alarm, protective, or life‑saving equipment and facilities directly related to production safety, and a significant risk has already materialized or a minor accident has occurred—yet no major or severe consequences have ensued due to accidental, objective causes—such circumstances may be deemed to constitute “real danger of causing major casualties or other serious consequences.”
Case 6
Case of Non-Prosecution for Dangerous Operations Involving Zhao Moukuan and Zhao Moulóng
——Standards for Determining “Real Danger” in Hazardous Mining Operations
I. Basic Facts of the Case
The person not prosecuted, Zhao Moukuan, male, Han ethnicity, born on August 28, 1992, is the person in charge of a certain mine in Yushan County, Jiangxi Province.
The person not prosecuted, Zhao Moulong, male, Han ethnicity, born on October 6, 1975, is a mine management personnel in Yushan County, Jiangxi Province.
On June 4, 2021, the Emergency Management Bureau of Yushan County, Jiangxi Province, issued a decision on on-site enforcement measures against a certain mine in Yushan County, revoked its work safety license expiring on June 6 of the same year, and ordered the mine to seal all surface-level mine shafts by June 7. On the afternoon of June 12, in order to maintain the mine’s water pump during the rainy season and drain accumulated water to prevent flooding, Zhao Moulong, with the consent of Zhao Moukuan, arranged for Wang Mouwen to dismantle the cement bricks sealing off the mine shafts. At approximately 4:00 p.m. on June 13, Wang Mouwen led Cheng Mouxing and Zhang Mocai to the mine’s 150-meter-deep section to repair the water pump. Due to the unauthorized use of wooden planks to partition mining waste within the shaft, these planks became moldy and damaged after being soaked by water, resulting in Cheng Mouxing being trapped by mining debris and sustaining injuries while replacing the pump. An assessment determined that Cheng Mouxing’s injuries constituted Grade I minor injury.
II. Outcome of the Handling
The Yushan County Public Security Bureau of Jiangxi Province initiated a criminal investigation into Zhao Moukuan and Zhao Moulong on suspicion of the crime of dangerous operations, subsequently transferring the case to the Yushan County People’s Procuratorate for review and prosecution. After examination, the Yushan County People’s Procuratorate determined that the conduct of Zhao Moukuan and Zhao Moulong “posed a real risk of causing major casualties or other serious consequences,” thereby satisfying the criteria set forth in Article 134‑1, Paragraph 3 of the Criminal Law and constituting the crime of dangerous operations. First, the “real danger” in this case is highly hazardous. In this instance, the enterprise involved operates mining activities, which, like metal smelting and the handling of hazardous chemicals, are all high‑risk industries, rendering its production processes inherently extremely dangerous. Despite the expiration of its work‑safety permit and an order to seal off all surface mine shafts, the enterprise nevertheless forcibly entered the shafts to carry out operations, creating a concrete risk to personal safety. Second, the “real danger” in this case is both immediate and pressing. The mine shafts owned by the enterprise had been continuously submerged during the rainy season, and the on‑site protective facilities, failing to meet regulatory standards, had begun to mold. During maintenance work on a water pump at a depth of 150 meters, a partition board broke, and mining debris fell, causing bodily injury. Thanks to prompt and effective rescue efforts, no major or particularly serious accident occurred; nonetheless, the situation still posed a tangible and imminent danger.
The Yushan County People’s Procuratorate has conscientiously implemented the criminal justice policy of “fewer arrests, cautious prosecution, and prudent detention,” integrating lawful punishment of crime with efforts to help private enterprises recover and mitigate losses. After considering the views of the victims and local grassroots organizations calling for leniency, the procuratorate applied the plea‑bargaining procedure in accordance with the law to the individuals involved. In light of the fact that Zhao Moukuan and Zhao Moulong actively rescued the injured and obtained the victims’ forgiveness after the incident, and that they voluntarily surrendered themselves—circumstances that warrant a lighter sentence—the procuratorate decided not to prosecute them. At the same time, addressing safety hazards that had not yet been fully eliminated during the enterprise’s production and operations, the procuratorate issued prosecutorial recommendations to the local Emergency Management Bureau and the Natural Resources Bureau. Working jointly with relevant departments, it provided guidance on the enterprise’s subsequent rectification measures, urging the company to equip itself with qualified fall‑protection devices, appropriate protective facilities and supplies, and a professional emergency rescue team, thereby ensuring that the enterprise’s principal and management personnel pass the required assessments of occupational safety knowledge and managerial competence. Once the enterprise met the eligibility criteria, it re‑applied for and obtained a new work‑safety production license.
III. Typical Significance
In the course of handling specific cases, if a judicial authority finds that, with respect to matters involving workplace safety, an entity has engaged in production activities such as mining, metallurgical smelting, or construction without lawful approval or authorization, and has already experienced a safety accident—though no major or serious consequences have yet resulted due to effective rescue efforts—it may determine that such conduct constitutes the “real danger of causing a major casualty accident or other serious consequences” under Article 134‑1 of the Criminal Law, which criminalizes hazardous operations. During case adjudication, judicial authorities shall, in accordance with the law, apply the system of leniency for guilty pleas and acceptance of punishment, and comprehensively, accurately, and规范ly implement the criminal justice policy of exercising restraint in arrests, prosecutions, and detention. For offenses involving hazardous operations where the circumstances are minor and no criminal penalty is necessary, a decision not to prosecute may be rendered. At the same time, close coordination between administrative and criminal enforcement should be strengthened with departments such as emergency management and natural resources, so as to urge the thorough identification and rectification of risks and hidden dangers at enterprises implicated in such cases, promote root‑cause governance, and ensure that both “punishment of crime” and “governance” are given equal emphasis.

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