JC Master Legal News Issue 1183

Key Takeaways for This Issue

The China Securities Regulatory Commission has issued a document to strengthen the protection of small and medium-sized investors in the capital market.
On October 27, the China Securities Regulatory Commission issued the “Several Opinions on Strengthening the Protection of Small and Medium-Sized Investors in the Capital Market” (CSRC Announcement [2025] No. 19), which shall take effect from the date of its promulgation.
The National Administration of Financial Regulation plans to issue the “Regulations on the Procedures for Implementing Administrative Licenses.”
On October 30, the National Administration of Financial Regulation issued a public notice soliciting comments on the “Regulations on the Procedures for Implementing Administrative Licenses (Draft for Public Comment).” The deadline for submitting feedback is November 30, 2025.
The National Administration of Financial Regulation plans to issue the Measures for the Administration of Licenses of Banking and Insurance Institutions.
On October 30, the National Administration of Financial Regulation issued the “Notice on Public Solicitation of Comments on the Measures for the Administration of Licenses of Banking and Insurance Institutions (Draft for Comments),” with a deadline for submitting feedback set for November 30, 2025.
The State Administration for Market Regulation has released a new version of the “Gift Contract (Model Text).”
On October 27, the State Administration for Market Regulation issued the “Gift Contract (Model Text)” (GF—2025—1301).

Finance & Capital Markets

The China Securities Regulatory Commission has issued a document to strengthen the protection of small and medium-sized investors in the capital market.
On October 27, the China Securities Regulatory Commission issued the “Several Opinions on Strengthening the Protection of Small and Medium-Sized Investors in the Capital Market” (CSRC Announcement [2025] No. 19), which shall take effect from the date of its promulgation.
The Opinions propose optimizing the pricing mechanism for new share offerings, enhancing the quality of information disclosure in prospectuses, strengthening the information‑disclosure obligations of listed companies and relevant parties, and encouraging listed companies to improve investor returns. They call for a comprehensive overhaul of regulatory frameworks governing margin trading and short selling, algorithmic trading, and securities and futures brokerage services, while requiring financial institutions to reinforce product suitability assessments, investor education, complaint handling, and suitability management. The document also mandates stringent crackdowns on illegal practices such as fraudulent issuance, financial fraud, insider trading, and market manipulation. Furthermore, it seeks to refine diversified dispute‑resolution mechanisms, bolster the litigation and exemplary roles of investor protection agencies, strengthen investor‑protection measures in delisting and voluntary delisting processes, and improve mechanisms for small and medium investors to participate in lawmaking and ensure legal safeguards.
The National Administration of Financial Regulation plans to issue the “Regulations on the Procedures for Implementing Administrative Licenses.”
On October 30, the National Administration of Financial Regulation issued a public notice soliciting comments on the “Regulations on the Procedures for Implementing Administrative Licenses (Draft for Public Comment).” The deadline for submitting feedback is November 30, 2025.
The Regulations refine the classification and tiered management mechanism for administrative licensing authorities, clearly defining the procedures for handling licensing matters related to the establishment, modification, termination, business operations, and qualification of senior personnel of banks, insurance companies, and other financial institutions. They require that application materials be truthful and complete, and set out specific procedures and time limits for each stage, including application, acceptance, review, decision‑making, service of documents, withdrawal, and public disclosure. The Regulations strengthen mechanisms such as consolidated reviews, regulatory coordination, hearings, expert evaluations, and on-site inspections. They also specify the conditions under which licenses may be withdrawn, revoked, or canceled, along with the corresponding compensation obligations; support electronic processing; and lay down requirements for the public announcement of administrative licensing matters and for information disclosure.
The National Administration of Financial Regulation plans to issue the Measures for the Administration of Licenses of Banking and Insurance Institutions.
On October 30, the National Administration of Financial Regulation issued the “Notice on Public Solicitation of Comments on the Measures for the Administration of Licenses of Banking and Insurance Institutions (Draft for Comments),” with a deadline for submitting feedback set for November 30, 2025.
The Measures stipulate that banking and insurance institutions must obtain licenses and business licenses in accordance with the law, specify the types and applicable scopes of financial licenses, insurance licenses, and insurance intermediary licenses, and set forth procedures for the issuance, renewal, revocation, loss, damage, amendment, and public announcement of such licenses. Institutions are required to properly manage and publicly display their licenses, undergo annual inspections, and submit management reports. Regulatory measures have been strengthened, with clear penalties for violations, including fines of up to RMB 100,000, and provisions governing the management of electronic licenses and their coordination with market supervision authorities.

Commercial & Corporate

In the first three quarters, financial institutions increased lending support for inclusive small and micro enterprises as well as the science and technology innovation sector.
Recently, data released by the People’s Bank of China showed that, as of the end of the third quarter, the outstanding balance of RMB-denominated loans across financial institutions reached 270.39 trillion yuan, up 6.6% year on year.
The outstanding balance of inclusive small and micro loans stood at RMB 36.09 trillion, up 12.2% year on year, with an increase of RMB 3.15 trillion in the first three quarters. The outstanding balance of operating loans to rural households with credit lines below RMB 5 million reached RMB 9.92 trillion, while the balance of student loans totaled RMB 294.4 billion, up 41.1% year on year. Green loan balances amounted to RMB 43.51 trillion, an increase of 17.5% from the beginning of the year. Agricultural-related loan balances totaled RMB 53.4 trillion, up 6.8% year on year. The outstanding balance of loans to technology‑focused small and medium‑sized enterprises reached RMB 3.56 trillion, up 22.3% year on year, with a loan approval rate of 50.3%; for high‑tech enterprises, the approval rate was 57.6%.

Taxation

Five departments have issued a document to refine duty-free shop policies and boost consumption.
Recently, the Ministry of Finance and four other departments jointly issued the “Notice on Improving Duty-Free Shop Policies to Boost Consumption” (hereinafter referred to as the “Notice”), which will take effect on November 1, 2025.
The Notice refines the duty‑free shop policy in the following four areas: First, it streamlines the administration of domestic goods’ tax refund (exemption) policies and actively supports both port‑based outbound duty‑free shops and downtown duty‑free shops in selling domestically produced goods. Second, it further expands the range of product categories available at duty‑free outlets, thereby broadening travelers’ shopping options. Third, it relaxes the approval authorities for establishing duty‑free shops and encourages local governments to tailor and optimize the layout of such stores in line with regional conditions. Fourth, it enhances facilitation measures and regulatory frameworks for duty‑free shops, continuously improving the duty‑free shopping experience for travelers. Under the Notice, enterprises holding qualifications to operate duty‑free goods, as well as foreign‑invested enterprises authorized by the State Council to engage in duty‑free operations, are encouraged to increase their procurement of high‑quality, distinctive domestic products. When these enterprises purchase domestic goods for sale at port‑based outbound duty‑free shops or downtown duty‑free shops, such transactions shall be treated as exports, entitling them to a refund or exemption from value‑added tax and consumption tax.

LITIGATION & ARBITRATION

The State Administration for Market Regulation has released a new version of the “Gift Contract (Model Text).”
On October 27, the State Administration for Market Regulation issued the “Gift Contract (Model Text)” (GF—2025—1301).
The new model text includes usage instructions that clearly define its scope of application and key considerations for execution; it categorizes the donated property into movable assets, immovable property, and rights, and further specifies provisions regarding methods of delivery, registration of changes, and allocation of transfer costs. Additionally, it introduces new clauses on revocation of gifts, exemption from gift obligations, and confidentiality requirements, thereby appropriately limiting the scope of obligations and safeguarding privacy.
Four draft laws, including the section on legal liability and the supplementary provisions of the Ecological and Environmental Code, are now open for public comment.
On October 28, the 18th Meeting of the Standing Committee of the 14th National People’s Congress reviewed and released the “Draft Second-Reading Version of the Pollution Prevention and Control Volume of the Ecological Environment Code,” the “Draft Second-Reading Version of the Legal Liability and Supplementary Provisions Volume,” the “Draft Law on Public Interest Litigation by the Procuratorate,” and the “Draft Law on Farmland Protection and Quality Enhancement,” inviting public comments until November 26.
Among these, the draft chapter on pollution prevention and control in the Ecological Environment Code covers measures for addressing air, water, marine, soil, solid waste, noise, radioactivity, chemical substances, electromagnetic radiation, and light pollution. It specifies corporate obligations such as pollutant discharge permitting, emission standards, total‑quantity control of key pollutants, automatic monitoring, information disclosure, emissions‑trading schemes, environmental protection taxes, and insurance. Meanwhile, the draft chapters on legal liability and supplementary provisions further delineate administrative, civil, and criminal liabilities for unlawful acts, providing for daily continuous penalties, aggravated or mitigated sanctions, joint and several liability, damage compensation, and procedures for reporting violations and pursuing accountability, while clearly defining the penalties and liable parties for various types of environmental offenses.
The State Council has reported to the Standing Committee of the National People’s Congress on the implementation of penal sanctions.
On October 27, the Ministry of Justice, on behalf of the State Council, reported to the 18th Meeting of the Standing Committee of the 14th National People’s Congress on the implementation of penal enforcement.
The report clearly stipulates that the execution of criminal penalties is divided among the judicial administration departments, public security organs, people’s courts, and people’s procuratorates: prisons are responsible for carrying out sentences of death with a two-year reprieve, life imprisonment, and fixed-term imprisonment, while community correction institutions oversee supervision, probation, parole, and temporary release from prison. The report places particular emphasis on standardizing the handling of cases involving sentence reduction, parole, and temporary release from prison, rigorously preventing “paper‑only incarceration” and “buying one’s way out.” It calls for advancing the revision of the Prison Law and improving the criminal penalty execution system, strengthening the capacity of community correction institutions, and strictly managing high‑risk offenders. Measures are also being taken to enhance security in correctional facilities, upgrade information‑technology platforms, and enable online case processing and oversight. Furthermore, efforts are being stepped up to build a robust police force and to improve funding mechanisms and infrastructure.
Report by the Supreme People’s Procuratorate on the Status of Supervision over the Execution of Penalties and on Measures for Improvement
On October 26, the Supreme People’s Procuratorate submitted the “Report on the Work of Supervision over the Execution of Penalties by the People’s Procuratorates” at the 18th Meeting of the Standing Committee of the 14th National People’s Congress.
The report summarizes that from January 2021 to September 2025, procuratorial organs put forward 971,000 supervisory and corrective opinions on the execution of criminal penalties, with a focus on ensuring the safety of prisons and detention centers and addressing issues such as “prison bosses” and prohibited items. The delivery and execution of custodial sentences were standardized, resulting in the correction of 96,000 cases where sentences had not been duly executed. Supervision of parole, sentence reduction, and temporary release cases was strengthened, leading to the rectification of 30,000 irregular cases. Community-based corrections oversight was enhanced, correcting 154,000 instances of inadequate or missed supervision. Oversight of property‑related penalties was also intensified, with 284,000 violations being corrected. A total of 1,735 judicial officers involved in the field of penalty enforcement were investigated for official misconduct. The “stationed +巡回+technology” supervisory mechanism was refined, promoting digital‑based oversight. The report further recommends strengthening the legal framework and optimizing the ranks of the procuratorial workforce.
The Supreme People’s Court has released six typical cases involving disputes over liability in traffic accidents.
The Supreme People’s Court recently released six typical cases involving disputes over liability in traffic accidents, covering scenarios such as collisions between motor vehicles and non-motorized vehicles, gratuitous ridesharing, the liability of ride-hailing platform operators, recovery actions by road rescue funds, and the lawful passage of non-motorized vehicles at signalized intersections.
The key provisions of the case are as follows: 1. If a passenger’s opening of a vehicle door causes harm to another person, the insurance company shall compensate within the limits of compulsory traffic liability insurance and commercial insurance; any amount exceeding these limits shall be shared by the driver and the passenger. 2. In cases of gratuitous carpooling, if the driver is not grossly negligent, their liability for compensation may be reduced. 3. An electric bicycle that, through its own fault, causes personal injury to a motor vehicle driver shall bear liability for damages. 4. Ride-hailing platform companies shall assume carrier liability and compensate passengers for damages. 5. After advancing medical expenses, the Road Rescue Fund has the right to seek reimbursement from the party responsible for the accident. 6. When non-motorized vehicles violate traffic signal regulations, administrative penalties shall be imposed in accordance with the law. These provisions clarify the allocation of responsibilities among all parties, strengthen insurance coverage and platform oversight, foster greater awareness of traffic rules among road users, and ensure timely relief for victims.

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