JC Master Legal News Issue 1193

Key Takeaways for This Issue

The Jiangsu High People’s Court has clarified the latest threshold for the amount in controversy applicable to small-claims litigation.
Recently, the Higher People’s Court of Jiangsu Province issued a notice clarifying the monetary threshold for cases to be heard under the small-claims procedure.
Jiangsu Courts Release Typical Cases on Providing Services and Guarantees for the High-Quality Development of the Private Economy
Recently, the Jiangsu Provincial Higher People’s Court released a selection of typical cases demonstrating how Jiangsu courts have served and supported the high-quality development of the private sector.
The Supreme People’s Court has released the 35th batch of Q&A on its Legal Answers Website, focusing on commercial adjudication.
Recently, the Supreme People’s Court published, through the People’s Court Daily, a selection of Q&A from the Legal Answers Network (Batch No. 35)—focused on commercial adjudication.

Finance & Capital Markets

The China Securities Regulatory Commission has issued the Measures for the Implementation of Supervisory and Administrative Measures in the Securities and Futures Markets.
Recently, the China Securities Regulatory Commission promulgated the Measures for the Implementation of Supervisory and Administrative Measures in the Securities and Futures Markets.
The Measures comprise 25 articles, clearly defining the types of supervisory and administrative measures applicable to the securities and futures markets. These include fourteen commonly used measures, such as orders to make corrections, regulatory talks, issuance of warning letters, and requirements to submit periodic reports, along with a catch-all provision. The Measures stipulate that the implementation of supervisory measures shall adhere to the principles of legality, efficiency, and fairness, requiring lawful procedures, timely rectification of violations, and prevention of risk contagion. They further detail the procedural framework for implementing these measures, covering general requirements such as evidence collection, decision-making, service of documents, on-site enforcement, recusal, and legal review, as well as special procedures like prior notification and expedited response mechanisms in emergency situations. The decision on a supervisory measure must specify the party’s identity, the factual basis, the type of measure, the method of compliance, and the avenues for appeal. The Measures also set forth requirements regarding the public disclosure, service, revocation, and reporting of supervisory decisions, and provide for the right to administrative reconsideration and judicial recourse. In principle, once an unlawful act has been subject to administrative penalties, no additional supervisory measures shall be imposed, unless absolutely necessary. The former “Measures for the Implementation of Supervisory and Administrative Measures in the Securities and Futures Markets (Trial)” is hereby repealed.
Shanghai Issues Several Provisions on the Development of Offshore Bond Business in the Pudong Free Trade Zone
Recently, the Standing Committee of the Shanghai Municipal People’s Congress promulgated the “Several Provisions on the Development of Free Trade Offshore Bond Business in the Pudong New Area of Shanghai.”
The Regulations explicitly stipulate that the free trade offshore bond business applies to the Pudong New Area, defining such bonds as transferable debt financing instruments issued by overseas issuers through a registration and custody institution to overseas investors. Issuers include foreign legal persons, non‑legal entities, foreign government‑related institutions, international organizations, overseas subsidiaries of domestic corporate legal persons, overseas branches of domestic financial institutions, and other entities approved by the State Council’s financial regulatory authorities; they are required to comply with anti‑money laundering, counter‑terrorist financing, and anti‑tax evasion regulations. The scope of eligible investors is similar to that of issuers. The Regulations permit banks, securities offices, trust companies, law offices, and other entities to provide related services; custody institutions shall, in principle, adopt a primary‑level custody model, while multi‑tiered custody is also permitted. Issuers may independently choose the currency in which funds are raised, with preference given to the use of RMB, and such funds are, in principle, to be used overseas. Detailed requirements are set forth for information disclosure, risk management, cross‑border supervision, and dispute‑resolution mechanisms. This document shall enter into force on March 1, 2026.

Commercial & Corporate

Shanghai has introduced measures to encourage foreign-invested enterprises to expand reinvestment within China.
Recently, the Shanghai Municipal Development and Reform Commission, the Shanghai Municipal Commission of Commerce, and other relevant departments released the “Several Measures of Shanghai to Encourage In‑Country Reinvestment by Foreign‑Invested Enterprises.”
The “Several Measures” center on supporting foreign-invested enterprises in Shanghai to reinvest domestically using undistributed profits or the domestic and foreign‑currency earnings of overseas investors, specifying that such reinvestment may be carried out through establishing new entities, increasing capital contributions, or acquiring equity interests. The document outlines the following key provisions: First, a project database for domestic reinvestment by foreign‑invested enterprises will be established; projects included in the city’s list of major and priority foreign‑invested projects will be coordinated by a dedicated task force and eligible for complementary support policies. Second, land‑use allocation will be optimized, allowing industrial land to be utilized under lease‑then‑transfer, combined lease‑and‑transfer, or long‑term lease arrangements. For industrial land aligned with industrial priorities, a flexible 20‑year tenure with renewal upon application will be implemented, while the land‑use term for major foreign‑invested industrial projects may extend up to 50 years. Third, municipal special funds and national ultra‑long‑term special government bonds will be leveraged to support technological upgrading, equipment modernization, and production expansion by foreign‑invested enterprises, encouraging reinvestment in the establishment of R&D institutions and technology‑innovation platforms, which will also receive funding from service‑trade special funds. Fourth, for the conversion of medical devices to other product lines, on-site inspections of registration and manufacturing systems will be waived or streamlined, and parallel review procedures will be adopted to enhance the efficiency of evaluation and approval processes. Foreign‑owned pharmaceutical wholesale enterprises will be permitted to implement cross‑regional, multi‑warehouse collaborative logistics under a unified quality management system, and qualified foreign‑owned food‑retail chain stores will be exempt from on-site inspections when applying for new food‑business licenses. Fifth, tax incentives for profit reinvestment will be fully implemented, with policy explanations provided in both Chinese and English, and enhanced enforcement of tax credits for direct profit reinvestment and the temporary suspension of withholding income tax. Sixth, foreign‑exchange registration and fund‑use procedures will be streamlined, with relaxed restrictions on the transfer and utilization of foreign‑exchange funds for domestic reinvestment, and support extended to qualified foreign limited partners (QFLP) and other channels to facilitate reinvestment, while expanding financing options such as shareholder loans and panda bonds. The document also calls for advancing an information‑reporting system for domestic reinvestment and an evaluation mechanism for the effectiveness of foreign‑investment promotion, incorporating reinvestment scale and contributions into the assessment framework, and strengthening external communication through dedicated policy sections and multilingual explanatory materials.
Shenzhen has introduced new regulations on the accreditation and management of incubators for technology-based enterprises.
On January 5, 2026, the Shenzhen Municipal Bureau of Industry and Information Technology promulgated the “Administrative Measures for Science and Technology Enterprise Incubators of the Shenzhen Municipal Bureau of Industry and Information Technology.”
The Measures comprise six chapters and twenty-six articles, designating the Shenzhen Municipal Bureau of Industry and Information Technology as the competent authority for the accreditation of technology‑based incubators in Shenzhen, while each district assumes responsibility for local administration. With respect to accreditation criteria, quantitative standards are set forth for the incubator’s legal status, length of operation, facility area (not less than 3,000 square meters), team composition (with professional staff accounting for at least 80%), number and structure of resident enterprises, growth in revenue and R&D investment, the proportion of equity investments or financing, the mix of incubation service revenues, the graduation rate of enterprises, statistical reporting requirements, and compliance with laws and regulations. The scope of resident and graduated enterprises is also clearly defined. The accreditation process adopts an annual centralized application system, culminating in public announcement and awarding of a plaque following formal review, expert evaluation, on-site verification, and specialized auditing. The evaluation and management section establishes an annual performance‑evaluation mechanism, categorizing results as excellent, satisfactory, or unsatisfactory and linking such outcomes to the revocation of eligibility. Operators that receive consecutive unsatisfactory ratings or are found to have committed serious violations of law or integrity, or to have engaged in environmental, quality, or safety incidents, shall be subject to re‑application restrictions of varying durations. The chapter on promoting development outlines policy directions to support the growth of incubators and their resident enterprises, covering areas such as funding, talent recruitment, land and premises allocation, financial assistance, industrial collaboration, and international and regional cooperation. It also provides provisions for aligning existing national, provincial, and municipal incubators with this framework and for formulating district‑level management measures.

LITIGATION & ARBITRATION

The Supreme People’s Court has issued a judicial reply on the eligibility criteria for applications for advance payment from the medical insurance fund.
On January 5, 2026, the Supreme People’s Court issued the “Reply of the Supreme People’s Court on Issues Concerning the Conditions for Applying the Law to Applications for Advance Payment from the Basic Medical Insurance Fund.”
The “Reply” sets forth specific provisions regarding the conditions under which medical expenses incurred by insured persons due to torts committed by third parties shall be advanced by the basic medical insurance fund, and it shall take effect as of February 1, 2026. In accordance with Article 30 of the Social Insurance Law of the People’s Republic of China and the relevant provisions of the Interim Measures on Advance Payment from the Social Insurance Fund, if an individual participating in basic medical insurance sustains injury or illness caused by the tort of a third party, and such liability should legally be borne by the third party but the third party fails to pay or cannot be identified, the basic medical insurance fund shall make advance payment. When submitting a written application to the social insurance administration agency in the place of insurance registration, the insured person shall specify the cause of the injury or illness and the circumstances under which the third party has failed to pay or cannot be identified. The social insurance administration agency shall conduct a lawful review and, in accordance with the payment regulations of the basic medical insurance fund in the pooled‑area, make advance payment of the corresponding medical expenses. The Reply further clarifies that the insured person’s right to apply for advance payment from the medical insurance fund is not affected by whether or not the insured person has already paid the medical expenses at the time of settlement. If the social insurance administration agency refuses to make advance payment solely on the ground that the insured person has already paid the medical expenses, and the insured person files a lawsuit requesting the court to order such advance payment, the people’s court shall, in accordance with the law, grant the request. With respect to medical expenses that have been advanced, the social insurance administration agency may, pursuant to Articles 11 and 12 of the Interim Measures on Advance Payment from the Social Insurance Fund, seek reimbursement from the liable third party.
The Jiangsu High People’s Court has clarified the latest threshold for the amount in controversy applicable to small-claims litigation.
Recently, the Higher People’s Court of Jiangsu Province issued a notice clarifying the monetary threshold for cases to be heard under the small-claims procedure.
Pursuant to Article 165 of the Civil Procedure Law and based on the 2024 annual average wage data for employees in urban non‑private sector units published by the Jiangsu Provincial Bureau of Statistics, effective January 4, 2026, all primary people’s courts and their branch tribunals across the province, as well as the Nanjing Maritime Court and the Xuzhou Railway Transport Court, shall apply the small‑claims procedure to newly filed civil, commercial, and maritime cases involving straightforward facts, clearly defined rights and obligations, and minor disputes, provided that the amount in controversy is RMB 64,610 or less. Such cases shall be subject to a single instance of adjudication with finality. For the aforementioned categories of cases where the amount in controversy exceeds RMB 64,610 but does not exceed RMB 258,440, the parties may agree to apply the small‑claims procedure.
Jiangsu Courts Release Typical Cases on Providing Services and Guarantees for the High-Quality Development of the Private Economy
Recently, the Jiangsu Provincial Higher People’s Court released a selection of typical cases demonstrating how Jiangsu courts have served and supported the high-quality development of the private sector.
This batch of typical cases focuses on key compliance issues facing private enterprises, including financial burdens, equal market access, intellectual property protection, settlement of construction payments, protection of reputation rights, timely payment of accounts owed to small and medium-sized enterprises, and bankruptcy reorganization. Seven judicial decisions have been carefully selected. In the financial sector, the cases clarify that disguised interest charges—such as “interest‑to‑fee conversions”—must be included in the assessment of the effective interest rate, and fees for services not actually rendered are not upheld. In insurance disputes, clauses excluding private hospitals from the scope of covered medical care are deemed invalid, mandating equal treatment among healthcare providers with comparable qualifications. Copyright disputes underscore that short‑video platforms bear corresponding liability for infringing content arising from proactive editing, topic‑driven operations, and algorithmic recommendations, and that damages awards may exceed statutory limits when warranted by the severity of the harm. In construction‑project and service‑contract disputes, courts issue preliminary judgments to prioritize the payment of undisputed project funds, employ “penetrative review” to invalidate “back‑to‑back” payment provisions, and prevent large enterprises from shifting financial risks onto SMEs. In reputation‑rights disputes, courts hold social media users liable for deleting false reports, issuing public apologies, and compensating for damage to a company’s goodwill. Finally, in bankruptcy‑reorganization cases, a combined “pre‑reorganization plus reorganization” procedure preserves the core qualifications and assets of private new‑energy enterprises, enabling market‑based relief and orderly revitalization. Collectively, these rulings further refine the boundaries of judicial protection and the standards for allocating responsibilities across financing, transactions, rights enforcement, and reorganization processes for private enterprises.
The Supreme People’s Court and the Ministry of Transport are jointly promoting the establishment of one-stop dispute-resolution centers on waterways.
On January 7, the Supreme People’s Court and the Ministry of Transport jointly issued the “Opinions of the General Offices of the Supreme People’s Court and the Ministry of Transport on Promoting the Establishment of One-Stop Dispute Resolution Centers for Waterborne Matters,” along with a selection of typical cases involving such one-stop centers.
Among these measures, the Opinions explicitly stipulate that people’s courts and maritime administration authorities shall jointly establish “one-stop” dispute‑resolution centers on waterways, integrating functions such as dispute mediation, legal consultation, and judicial conofficeation, to ensure that “minor issues are resolved on board, major issues remain within the port, and conflicts are not escalated,” thereby efficiently handling maritime disputes—including personal injury, ship collisions, labor‑management disputes, and ship sales—through non‑litigation means. The document calls for refining the procedures for linking litigation with mediation and for judicial conofficeation, standardizing the review processes and criteria applied to mediation agreements reached at these centers, and establishing regular mechanisms for liaison, periodic consultations, and professional exchanges. Furthermore, subject to compliance with laws and regulations, it encourages the sharing of necessary information and the integration of online platforms between courts and maritime authorities. People’s courts are required to engage at the front end of dispute resolution, using model judgments, judicial recommendations, and the publication of typical cases to regulate shipping practices; meanwhile, maritime authorities should leverage their expertise in accident investigation and technical appraisal to provide support for determining liability and assessing losses. Localities may, in light of regional waterway characteristics and common types of disputes, explore models such as “expedited mediation plus online judicial conofficeation,” thereby building a diversified dispute‑resolution system that covers upstream prevention, front‑end mediation, and litigation as a safety net. Additionally, through joint training programs and collaborative think‑tank initiatives, they should cultivate multidisciplinary professionals who possess both legal and maritime expertise.
The Supreme People’s Court has released the 35th batch of Q&A on its Legal Answers Website, focusing on commercial adjudication.
Recently, the Supreme People’s Court published, through the People’s Court Daily, a selection of Q&A from the Legal Answers Network (Batch No. 35)—focused on commercial adjudication.
This batch of Q&A provides normative answers to five practical issues in commercial adjudication: First, it clarifies that when an employer purchases group accident insurance for its employees, the insurance proceeds may not be set off against the employer’s liability for compensation, nor may the employer acquire any right to claim such proceeds or to pursue subrogation after having borne the compensation obligation. Second, it conoffices that the capitalization of capital reserves into registered capital constitutes merely an internal equity adjustment, does not increase the company’s assets, and does not impose on shareholders any obligation to make additional contributions; moreover, shareholders may not be added as parties subject to enforcement solely on the ground of “unpaid contributions.” Third, the statute of limitations applicable to negotiable instruments may be interrupted pursuant to the Civil Code; however, upon such interruption, the special provisions of Article 17 of the Negotiable Instruments Law—relating to short-term limitation periods—shall continue to apply, without reverting to the general statute of limitations, and the commencement of the limitation period shall be determined separately for claims against the drawer, the acceptor, and prior endorsers versus subsequent recourse. Where the limitation period has expired, the ordinary statute of limitations may be applied based on the right to claim restitution of benefits under the instrument. Fourth, with respect to motor‑vehicle insurance claims, a distinction is drawn between total loss and partial loss: in cases of total loss, the insurer may not refuse payment on the ground that the vehicle has not been repaired; for partial loss, compensation is calculated on the basis of “actual repair costs,” and if the loss can be reasonably determined through appraisal or expert assessment even without repair, the insurer may not deny coverage on that ground. However, if the loss cannot be reasonably ascertained or there is a legitimate dispute and the vehicle remains unrepaired, the insurer’s refusal to pay may be upheld. Fifth, regarding court fees in cases filed prior to the acceptance of bankruptcy proceedings that are attributable to the debtor enterprise, such fees are classified as ordinary bankruptcy claims rather than bankruptcy expenses. It is emphasized that bankruptcy expenses should be limited to those necessary expenditures incurred during the bankruptcy process in the common interest of all creditors, and, in accordance with the Judicial Interpretation (III) of the Enterprise Bankruptcy Law, distinct treatment is prescribed for compulsory liquidation fees, execution fees, case filing fees, and application fees for enforcement.

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