JC Master Legal News Issue 1174

Key Takeaways for This Issue

The China Securities Regulatory Commission has revised and issued the “Regulations on the Classification and Evaluation of Securities Companies.”
On August 22, the China Securities Regulatory Commission revised and issued the Regulations on the Classification and Evaluation of Securities Offices. The new rules emphasize enhancing the functional role of securities offices; guide them to focus on high-quality development while supporting small and medium-sized institutions in pursuing differentiated growth and specialized operations; and underscore a “crackdown on major violations and misconduct” approach, strengthening comprehensive disciplinary measures and effectively bolstering investor protection for retail investors.
The Ministry of Finance and the State Taxation Administration have issued the “Announcement on Improving the Value-Added Tax End-of-Period Credit Refund Policy.”
On August 22, the Ministry of Finance and the State Taxation Administration issued the “Announcement on Improving the Value-Added Tax End-of-Period Credit Refund Policy” (hereinafter referred to as the “Announcement”). The Announcement stipulates that, starting from the VAT filing period in September 2025, eligible general VAT taxpayers may, in accordance with relevant regulations, apply to their competent tax authorities for a refund of their end-of-period input VAT credit.
The Supreme People’s Court has released the second batch of typical cases involving administrative enforcement against enterprises.
On August 18, the Supreme People’s Court released the second batch of typical cases involving administrative enforcement against enterprises, which collectively highlight the courts’ judicial practice in administrative enforcement matters.

Finance & Capital Markets

The China Securities Regulatory Commission has revised and issued the “Regulations on the Classification and Evaluation of Securities Companies.”
On August 22, the China Securities Regulatory Commission revised and issued the Regulations on the Classification and Evaluation of Securities Offices. The new rules emphasize enhancing the functional role of securities offices; guide them to focus on high-quality development while supporting small and medium-sized institutions in pursuing differentiated growth and specialized operations; and underscore a “crackdown on major violations and misconduct” approach, strengthening comprehensive disciplinary measures and effectively bolstering investor protection for retail investors.

Commercial & Corporate

Beijing Municipality plans to revise the “Measures for the Implementation of the Capital Science and Technology Infrastructure Platform and Innovation Vouchers.”
On August 18, the Beijing Municipal Science and Technology Commission and the Zhongguancun Science Park Administrative Committee released the “Measures for the Implementation of the Capital Science and Technology Infrastructure Platform and Innovation Vouchers (Draft for Public Comment)” and opened it for public consultation, with a deadline of August 22.
The “Implementation Measures” comprise seven chapters and 22 articles. The key revisions include: first, abolishing the requirements regarding the length of time a company has been established and its inclusion in the database for applying for innovation vouchers, thereby broadening support to small, medium, and micro enterprises; second, strengthening the responsibilities of open‑access entities and specialized service providers by mandating that service providers be independent legal entities with professional expertise; third, clarifying the classification criteria for performance evaluation and the scope of subsidy funding to enhance the efficiency of public financial resource utilization; fourth, refining the exit mechanism for open‑access entities, disqualifying those that repeatedly fail performance assessments and imposing a three‑year ban on re‑entry; and fifth, increasing the annual innovation voucher allocation for large-scale enterprises in the science and technology services sector to RMB 500,000.
The Shenzhen Justice Bureau plans to issue a guideline to assist enterprises in addressing “assisting in the illegal use of information networks.”
On August 19, the Shenzhen Municipal Justice Bureau issued a notice soliciting public comments on the local standard “Guidelines for Enterprises on Preventing, Identifying, and Responding to ‘Assisting in the Illegal Use of Information Networks’ (Draft for Public Comment).” The deadline for submitting feedback is September 19, 2025.
The Guidelines clearly delineate the management responsibilities of enterprises in preventing, identifying, and responding to “assisting‑in‑crime activities,” specifying the duties of top management, the compliance management department, managers, and all employees. They require enterprises to establish a compliance management system, implement personnel management, advance information‑technology development, conduct compliance training, and formulate emergency response plans, while also detailing measures for risk identification, internal investigations, compliance reviews, reporting, reward and punishment mechanisms, and cooperation with law enforcement. The appendix lists common types of “assisting‑in‑crime activities” along with their criteria for determination, emphasizing compliance oversight in high‑risk areas such as payment and settlement, online services, and advertising and promotion.
The Ministry of Industry and Information Technology is soliciting leads on issues identified during the nationwide comprehensive inspection aimed at alleviating the burden on enterprises and promoting the development of small and medium-sized enterprises.
On August 20, the Ministry of Industry and Information Technology issued the “Notice on Soliciting Clues Regarding Issues in the Comprehensive Inspection to Promote New‑Type Industrialization and to Alleviate the Burden on Enterprises and Foster the Development of Small and Medium‑Sized Enterprises Nationwide,” opening a public call for relevant leads from today through August 31.
The announcement specifies that the key areas of oversight include: first, the progress made across regions in advancing new‑type industrialization, increasing the share of manufacturing, integrating science and technology with industrial innovation, fostering both traditional and emerging industries, promoting the digital and green transformation of manufacturing, upgrading equipment, and registering technology contracts; second, the standardization of administrative actions affecting businesses, the implementation of lists of business‑related matters, efforts to curb arbitrary fees and fines, tax and fee reductions, ensuring stable supply and prices of production factors, reforming government services, and establishing mechanisms for business communication; and third, the implementation of policies supporting the development of small and medium‑sized enterprises, including initiatives to promote specialization, refinement, uniqueness, and innovation, cluster development, internationalization, job creation, innovation and entrepreneurship, access to financing, and the settlement of outstanding payments. Businesses and members of the public may submit named reports of issues via designated email addresses or online platforms.

Taxation TAXATATION

The Ministry of Finance and the State Taxation Administration have issued the “Announcement on Improving the Value-Added Tax End-of-Period Credit Refund Policy.”
On August 22, the Ministry of Finance and the State Taxation Administration issued the “Announcement on Improving the Value-Added Tax End-of-Period Credit Refund Policy” (hereinafter referred to as the “Announcement”). The Announcement stipulates that, starting from the VAT filing period in September 2025, eligible general VAT taxpayers may, in accordance with relevant regulations, apply to their competent tax authorities for a refund of their end-of-period input VAT credit.

Litigation & Arbitration

The Supreme People’s Court has released the second batch of typical cases involving administrative enforcement against enterprises.
On August 18, the Supreme People’s Court released the second batch of typical cases involving administrative enforcement against enterprises, which collectively highlight the courts’ judicial practice in administrative enforcement matters.
The five cases released this time include: 1. The case in Xiangtan City, Hunan Province, where the Market Supervision Administration seized the property of a traditional Chinese medicine business; the court ruled that the seizure was unlawful and ordered remedial measures. 2. The case in Zhandian Town, Wuzhi County, Henan Province, where the town government sealed a plastic products factory; the court declared the sealing invalid. 3. The case in Qingjiangpu District, Huai’an City, Jiangsu Province, where the enforcement bureau forcibly demolished an advertising billboard belonging to a media company; the court held that the forced demolition was unlawful and ordered compensation for losses. 4. The case in Anding District, Dingxi City, Gansu Province, where the Housing and Urban–Rural Development Bureau forcibly demolished a bus shelter owned by a cultural communication company; the court conofficeed that the forced demolition was unlawful. 5. The case in Hekou District, Dongying City, Shandong Province, where the Market Supervision Administration applied for compulsory enforcement against a lubricant company; the court recommended that no administrative penalty be imposed.
The Guangdong-Hong Kong-Macao Greater Bay Area’s one-stop cross-border commercial dispute resolution platform has officially launched.
Recently, the Guangdong Provincial Higher People’s Court and the Guangdong Provincial Department of Justice jointly launched a one-stop cross-border commercial dispute resolution platform for the Guangdong-Hong Kong-Macao Greater Bay Area.
The platform integrates mediation, arbitration, and litigation—the three major dispute‑resolution channels—offering bilingual Chinese–English services and combining dispute‑resolution guidance, procedural coordination, and ancillary support into a single system. It provides one‑stop access to the Guangdong Courts website, mediation organizations, and arbitration institutions, enabling online applications for case filing, mediation, arbitration, property preservation, judicial conofficeation, and compulsory enforcement, thus achieving end-to-end online processing in a closed loop. The platform also incorporates features such as AOL‑authorized notarization, cross‑jurisdictional legal‑fact verification, and an expert database, while bringing on board numerous mediation organizations and arbitration institutions from Hong Kong and Macao, along with specially appointed mediators, thereby enhancing the efficiency and convenience of resolving cross‑border commercial disputes.
A Beijing court ruled that the non-compete clause in the livestreaming instructor’s contract is invalid.
Recently, the Chaoyang District People’s Court in Beijing issued a first-instance judgment in a case brought by a technology company against livestreaming instructor Mr. Shi for breaching a non‑compete agreement, holding that the non‑compete clause agreed upon by the parties was not enforceable against the employee and dismissing the company’s claim.
The court held that, as a lecturer, Mr. Shi does not fall within the category of senior management personnel, senior technical personnel, or individuals subject to confidentiality obligations; moreover, the content of his lectures was publicly available and did not involve the company’s trade secrets. The company failed to provide evidence demonstrating that Mr. Shi possessed any trade secrets or confidential information, rendering the non‑compete clause legally unenforceable against him. Furthermore, the agreement allowing the company to initiate or terminate the non‑compete obligation at its discretion imposes an unreasonable burden on the employee, while the scope of the geographic and personnel restrictions is excessively broad, thereby unduly restricting the employee’s freedom to choose employment.
The company filed its workers’ compensation claim after the statutory deadline; the court ruled that the company must bear the medical expenses incurred prior to the workers’ compensation determination.
Recently, the Sichuan Provincial Higher People’s Court, in a retrial, ruled that a certain company, which had filed its workers’ compensation claim late, must pay the plaintiff, Lu, a total of over RMB 204,000, including medical expenses for the “gap period.”
The case clarifies that when an employer fails to file a workers’ compensation claim within the statutory time limit, the employer shall bear the medical expenses incurred prior to the determination of the injury as a work‑related accident, and the court must accept the case. The appellate court erroneously classified these expenses as falling within the scope of payment by the workers’ compensation insurance fund; following a protest by the Sichuan Provincial People’s Procuratorate, the Higher People’s Court adopted the procuratorial opinion, reversed the original judgment, and upheld the worker’s claims. This case delineates the respective responsibilities of the social security fund, the employer, and the injured worker, reinforces the employer’s obligation to fulfill its legal duties, and serves as a cautionary reminder for enterprises regarding compliant employment management.

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