JC Master Legal News Issue 1083

Key Takeaways for This Issue

The Beijing Stock Exchange and the National Equities Exchange and Quotations Co., Ltd. have launched a dedicated “Three Services” administrative service section on their official websites.
Recently, the Beijing Stock Exchange and the National Equities Exchange and Quotations Company have launched a dedicated “Three Services” service portal on their official websites, enabling market participants to access information and services more conveniently and efficiently, thereby enhancing their sense of gain and satisfaction.
Regulations Clarified: During the IPO review process, investment banks are required to conduct due diligence on four major areas, with significant public sentiment serving as one of the key factors.
Recently, the Shanghai Stock Exchange issued the latest edition of its “Shanghai Stock Exchange Issuance and Listing Review Updates” to sponsoring institutions. In light of this, the Exchange has further clarified the additional matters that sponsoring institutions are required to continuously scrutinize through due diligence during the review period, beyond responding to review inquiries.
Adjustment of Responsibilities among the Ministry of Industry and Information Technology and Other Departments
The General Office of the CPC Central Committee and the General Office of the State Council recently issued a notice to adjust the functions, responsibilities, and organizational structure of the Ministry of Industry and Information Technology, the Ministry of Ecology and Environment, the National Health Commission, and the People’s Bank of China, as well as to revise the duties of the Chinese Academy of Social Sciences.
The Supreme People’s Court has issued guidelines to safeguard, in accordance with the law, the property rights of private enterprises and the legitimate rights and interests of entrepreneurs.
On the 10th, the Supreme People’s Court held a press conference to release details of the “Guiding Opinions of the Supreme People’s Court on Optimizing the Rule-of-Law Environment and Promoting the Development and Growth of the Private Sector.”
Finance & Capital Markets
The Beijing Stock Exchange and the National Equities Exchange and Quotations Co., Ltd. have launched a dedicated “Three Services” administrative service section on their official websites.
To thoroughly implement the “Three Services” principle—“open‑door service, direct‑to‑the‑point service, and precision‑oriented service”—and further enhance market transparency while elevating the standardization, regularization, and convenience of services, the Beijing Stock Exchange and the National Equities Exchange and Quotations Company have recently launched a dedicated “Three Services” service portal on their official websites. This initiative enables all market participants to access information and services more conveniently and efficiently, thereby boosting their sense of gain and satisfaction with the market.

The dedicated zone is organized by business areas—including listing and delisting review, corporate governance, member management, trading supervision, investor services, and corporate training—and features functional modules such as rule search, access to business systems, service guides, and consultation‑communication channels. In the rule‑search section, core business rules and operational guidelines are systematically listed, enabling all market participants to conveniently consult regulatory requirements. The business‑systems section provides “one‑click links” to relevant platforms for information disclosure, application filing, and submission of responses to inquiries, streamlining administrative processes. The service‑guides section not only covers all applicable procedures but also includes specific guides for administrative licensing matters handled by the Beijing Stock Exchange, detailing processing timelines, required documentation, and other key details to ensure clearer, more standardized workflows. The consultation‑communication section offers multiple online and offline channels, allowing market participants to choose the information‑access method best suited to their needs and preferences, thereby enhancing the relevance and effectiveness of services. Additionally, certain business lines have established dedicated modules tailored to specific market demands.

The dedicated zone highlights three key features: First, it implements centralized review and one-stop service, ensuring that services are “easy to find and easy to use.” Addressing a wide range of high‑frequency, high‑consultation‑volume matters—such as issuance and listing, market registration, refinancing, and corporate governance—the zone adheres to the “at most one visit” principle, enabling all market participants to conduct inquiries, seek advice, and complete procedures in a single, integrated platform. Second, it promotes transparency and predictability, making services “visible and tangible.” Through the zone, market participants can access real-time updates on review projects, promptly learn about the basic status of companies under review, track the progress of review and registration, view inquiry comments and responses, and stay informed about the outcomes of review and registration meetings and decisions. Going forward, the zone will also publish and regularly update lists of self‑regulatory and market‑service items for the Beijing Stock Exchange and the New Third Board, making this information publicly available and embedding standardized, transparent services throughout every stage and aspect of public authority operations. Third, it focuses on unblocking channels and resolving challenges, ensuring that services are “clearly accessible and thoroughly explained.” For example, the Listing and Market Registration Review Zone offers multiple consultation channels—including business systems, telephone support, and in‑person communication—while the Listing and Listed Company Services Zone provides tailored, “butler‑style” advisory services, a dedicated secretary‑general email address, and on‑site engagement opportunities such as “Department Head Reception Days” and “Launch‑up Meet‑ups,” allowing companies to choose among direct contact, visits, and participation in events based on their needs. Meanwhile, the Investor Services Zone offers a consultation hotline, an email channel, and an intelligent customer‑service system, welcoming input from all sectors of society to help advance market development and improve service quality.

Going forward, the Beijing Stock Exchange and the National Equities Exchange and Quotations Company will remain officely committed to a people-centered approach, deepen the integration of deregulation and regulation, and further optimize the market’s business environment. With a focus on efficiency and convenience and addressing key market concerns, they will continue to enhance the dedicated zone’s functionality, promptly launch new business modules, and refine its categorized displays, ensuring that the zone is both more attractive and easier to use.

September’s price data have been released: the CPI remained unexpectedly unchanged year-on-year, suggesting that monetary policy is likely to stay accommodative in the fourth quarter.
On October 13, the National Bureau of Statistics released data showing that in September, the national CPI (Consumer Price Index) rose month-on-month but remained unchanged year-on-year, while the PPI (Producer Price Index) saw an expanded month-on-month increase and a narrower year-on-year decline. This trend was broadly in line with market expectations, though the magnitude fell short of forecasts. Analysts expect that, driven by the steady recovery of domestic consumer demand and the anticipated rebound in pork prices as winter curing activities pick up, the CPI is likely to trend steadily higher in the fourth quarter. Meanwhile, the year-on-year decline in the PPI is expected to narrow further. Monetary policy will remain accommodative, supporting a continued recovery in both investment and consumption.
The year-on-year uptrend in the CPI has “paused.”
On a year-on-year basis, the CPI in September turned flat from a 0.1% increase in the previous month. This marks a pause in the upward trend after the CPI had risen by 0.1 percentage point year on year in August. The outcome fell short of market expectations and has become a focal point of attention.
Specifically, in September, food prices fell by 3.2%, a decline that widened by 1.5 percentage points compared with the previous month, lowering the CPI by approximately 0.60 percentage points. Dong Lijuan, chief statistician of the Urban Division at the National Bureau of Statistics, noted that among food items, pork and fresh vegetable prices dropped by 22.0% and 6.4%, respectively, with the declines expanding by 4.1 and 3.1 percentage points, together accounting for about 0.51 percentage point of the CPI’s overall decrease—nearly 90% of the total drop in food prices.
The Minsheng Bank Research Institute noted that food prices have been notably weaker than seasonal norms. In particular, pork prices, while posting a slight month-on-month increase—reflecting a rebound in demand ahead of the upcoming “double holidays”—have also seen a short-term supply release following earlier market‑driven holding‑back. After a rebound in July and August, pork prices edged down from their peak in September, with the month-on-month gain narrowing to 0.2% and the year-on-year decline widening to 22%.
Chen Li, chief economist at Chuancai Securities, stated that the CPI trend is influenced, first, by the high base effect from the same period last year, and second, to a significant extent, by the weakening of pork prices in September.
According to data released by the Ministry of Agriculture and Rural Affairs, since September, both the national average price of piglets and the national average price of pork have declined week after week on a month-over-month basis. Coupled with the higher base in the same period last year, the year-on-year decline in pork prices has widened.
Chen Li stated that, looking ahead to the fourth quarter, with the domestic consumer market steadily recovering and demand picking up, pork prices are expected to rebound as winter curing and preserving activities commence. Meanwhile, declining overseas inventories and retailers’ preparations for the Double 11 shopping peak are also likely to support upward pressure on the CPI, leading to a steady rise in inflation.
Pan Xiangdong, chief economist at the Qilai Research Institute, stated that China’s inflation is expected to remain on a moderate recovery path in the fourth quarter. Given the still ample supply of live pigs, there is no solid basis for a sustained sharp rise in pork prices. Meanwhile, amid ongoing geopolitical tensions, oil prices are likely to stay above $90 per barrel in the fourth quarter. Should housing‑related CPI readings improve going forward, the resulting uptick in rental‑related inflation could provide support to core inflation.
The decline in the PPI has narrowed for three consecutive months, while the month-on-month increase has widened.
Data show that in September, the PPI fell 2.5% year-on-year but rose 0.4% month-on-month. Pan Xiangdong, chief economist at the Qirui Research Institute, noted that the decline in the PPI has narrowed for three consecutive months, while the month-on-month increase has widened, driven primarily by a recovery in industrial demand and continued rises in international crude oil prices.
Since the second half of the year began, international oil prices have continued to rise, repeatedly breaching the $90-per-barrel mark since September. Earlier, several market institutions had predicted that, with rising prices across the crude‑oil value chain and the fading carryover effect, the year-on-year decline in the PPI is likely to narrow further.
Dong Lijuan noted that, by component, prices for production materials rose 0.5% in September, with the rate of increase widening. In particular, international crude oil prices continued to climb, pushing up prices in the domestic petroleum and natural gas extraction sector by 4.1% and in the petroleum, coal, and other fuel processing industry by 3.1%. Improved demand and tight supply conditions also drove a 1.2% rise in prices in the nonferrous metal smelting and rolling processing industry and a 1.1% increase in the coal mining and washing sector. Thus, the narrowing decline in the PPI is also underpinned by the gradual recovery of industrial demand.
Pan Xiangdong expects that, as policies to stabilize growth are gradually implemented and take effect, related demand will likely help narrow the year-on-year decline in the PPI for the fourth quarter to below 2.0%. Chen Li cautions that, given the significant volatility in international crude oil prices in October, the PPI is expected to experience some degree of structural adjustment in the fourth quarter.
The Minsheng Bank Research Institute believes that in the fourth quarter, the trend of recovering demand among China’s industrial enterprises will persist; however, the base-effect and external transmission factors will weaken, potentially moderating the pace at which the year-on-year decline in the PPI narrows.
Institution: Interest rates and the reserve requirement ratio may be cut again in the fourth quarter.
Based on current price data, analysts widely expect monetary policy to remain accommodative in the fourth quarter.
Chen Li stated that China’s economy achieved gradual stabilization and recovery in the third quarter, and he expects this weak recovery trend to continue into the fourth quarter. With domestic household incomes rebounding and consumption picking up, domestic price levels are likely to maintain a steady upward trajectory in the fourth quarter. However, given that current price levels remain relatively low and the economy is still in a phase of stabilization and recovery, monetary policy is expected to stay accommodative to further support the recovery of investment and consumption. The People’s Bank of China’s quarterly meeting also signaled an intention to further ease monetary policy; accordingly, interest-rate cuts and reductions in the reserve requirement ratio may be implemented in the fourth quarter, while policies aimed at addressing real‑estate and debt risks are likely to be strengthened.
Pan Xiangdong stated that since mid-August, the pace of introducing policies to stabilize growth has accelerated. On the monetary policy front, interest rates and the reserve requirement ratio were cut in August and September, while bank deposit rates and mortgage rates were also lowered. In the People’s Bank of China’s recent third-quarter meeting, the phrase “counter-cyclical adjustment” was retained, but the tone toward the current situation grew more optimistic. The addition of the statement “to intensify the implementation of already‑issued monetary policies” may suggest that the central bank will continue the policy trajectory of August and September in the fourth quarter, thereby helping to ensure a stabilization and rebound in economic fundamentals.
A research report by CCB International also notes that macro policies are expected to remain accommodative, with fiscal support likely to accelerate in order to bolster demand. Further cuts to the reserve requirement ratio and interest rates in the fourth quarter remain possible.
Earlier this year, the central bank cut the reserve requirement ratio twice, lowering it by a total of 0.5 percentage points and releasing over one trillion yuan in medium- and long-term liquidity.

RMB 3.74 trillion— a new high so far this year!
“In the first three quarters of this year, despite a complex and challenging external environment and multiple domestic difficulties and challenges, China has adhered to the overarching principle of seeking progress while maintaining stability. The economy has shown an overall recovery and improvement, high-quality development has been steadily advanced, and China’s trade in goods has remained stable and continued to improve,” said Lü Daliang, spokesperson for the General Administration of Customs and Director-General of the Department of Statistics and Analysis, at a press conference held by the State Council Information Office on October 13.
According to customs statistics, China’s total import and export value for the first three quarters reached 30.8 trillion yuan, a slight year-on-year decrease of 0.2%. Specifically, exports amounted to 17.6 trillion yuan, up 0.6% year on year, while imports totaled 13.2 trillion yuan, down 1.2% year on year.
On a monthly basis, according to Lü Daliang, China’s total imports and exports in September reached 3.74 trillion yuan, marking the second consecutive month of growth and hitting a new year-to-date high. On a quarterly basis, trade has risen steadily quarter by quarter, with imports and exports totaling 9.72 trillion yuan, 10.29 trillion yuan, and 10.79 trillion yuan in the first, second, and third quarters, respectively.
Continuously advancing efforts to stabilize scale and optimize structure.
Lü Daliang stated that China’s foreign trade in the first three quarters exhibited the following characteristics.
China’s private enterprises posted robust growth in imports and exports. In the first three quarters, their trade volume reached RMB 16.34 trillion, up 6.1% year on year, accounting for 53.1% of the country’s total foreign trade. During the same period, foreign-invested enterprises recorded RMB 9.42 trillion in imports and exports, while state-owned enterprises reported RMB 4.95 trillion, representing 30.6% and 16.1%, respectively.
Trade with countries participating in the Belt and Road Initiative outperformed the overall trend. In the first three quarters, China’s trade with these countries totaled RMB 14.32 trillion, up 3.1% year on year, accounting for 46.5% of the country’s total foreign trade value.
Meanwhile, the share of China’s electromechanical product exports has increased. In the first three quarters, China’s electromechanical exports totaled RMB 10.26 trillion, up 3.3% year on year, accounting for 58.3% of the country’s total export value—1.5 percentage points higher than the same period last year. Among these, automobile and auto parts, ships, and electrical equipment recorded growth rates of 48.2%, 26.8%, and 16.2%, respectively.
Imports of bulk commodities and consumer goods expanded. In the first three quarters, China’s imports of energy, metal ores, grain, and other bulk commodities increased by 16.5% year on year. During the same period, imports of consumer goods totaled RMB 1.46 trillion, up 3.1%. Among these, dried and fresh fruits and nuts, as well as medical and health products, grew by 22.8% and 18.5%, respectively.
“Overall, amid an uncertain global economic recovery, China’s foreign trade has withstood pressure, steadily maintained its scale while optimizing its structure, and continued to build on positive momentum. We are confident that, as China’s economy continues to improve and endogenous drivers strengthen, the practical measures aimed at stabilizing foreign trade will remain effective, leading to a more robust import‑export performance and further improvements in quality and efficiency. The goals of ensuring stability and enhancing quality are certainly within reach,” said Lü Daliang.
Foreign trade imports have maintained strong momentum.
On the import front, Lü Daliang stated that China has long adhered to an strategy of expanding imports and has remained the world’s second-largest import market for 14 consecutive years. In the first three quarters of this year, China’s foreign trade imports continued to maintain strong momentum, with notable highlights in terms of overall volume, product mix, and structural diversification.
Lü Daliang stated that, first, the scale of imports has been rising quarter by quarter, with a favorable trend in imports from major source regions. In the first, second, and third quarters, China’s import value reached RMB 4.23 trillion, RMB 4.39 trillion, and RMB 4.58 trillion, respectively, reflecting a steady expansion across each quarter. Notably, China’s imports from Latin America, ASEAN, and the European Union have all posted quarter-on-quarter growth for two consecutive quarters, with quarter-on-quarter increases of 8.5%, 6.3%, and 2.6% in the third quarter, respectively.
Second, import volumes have been steadily rising, continuing to play a vital role in ensuring supply and stabilizing industrial chains. China’s imports have posted year-on-year growth for eight consecutive months, with cumulative growth of 2.6% in the first three quarters.
Third, import market access has been broadened and diversified, better meeting the consumption needs of the people. To date, China has established customs inspection and quarantine cooperation with 171 countries and regions, and has signed nearly 400 international cooperation agreements on market access for agricultural and food products. In the first three quarters, China’s agricultural imports increased by 8.6%. Meanwhile, as domestic consumer demand continues to expand steadily, imports of certain personalized and premium‑grade consumer goods have also grown. During the same period, imports of jewelry, watches, medical and health products, and footwear, luggage, and bags rose by 74.3%, 18.9%, 18.5%, and 9.2%, respectively.
“Expanding imports is both a natural step in China’s efforts to accelerate the establishment of a new development paradigm and an opportunity for countries around the world to share in China’s development prospects,” said Lü Daliang. Next month, the sixth China International Import Expo will be held in Shanghai. Building on the customs‑facilitation measures implemented at the previous five editions, the General Administration of Customs has introduced 17 streamlined measures covering the entire process—from exhibition admission and import clearance of exhibits to post‑exhibition handling—ensuring that each successive edition of the CIIE becomes even better.
Lü Daliang stated: “Overall, as China’s strategy of expanding imports continues to deepen and a new development pattern—characterized by the domestic circulation as the mainstay and the mutual promotion of domestic and international circulations—is being accelerated, the open and vast Chinese market will bring greater and broader benefits to the world.”
Introduce new policies and measures in a timely manner.
Turning to the next phase of policy measures, Lü Daliang stated that since the beginning of this year, the General Administration of Customs has worked to stabilize the scale and improve the structure of foreign trade, vigorously implementing a comprehensive package of measures to ensure stability and enhance quality, while introducing targeted policies and initiatives. In June this year, the General Administration of Customs unveiled 16 measures to optimize the business environment, and its directly affiliated customs offices have subsequently rolled out detailed supporting measures, creating a coordinated set of policies and actions to bolster foreign trade.
“Based on monitoring, all 16 measures are being implemented and yielding results,” said Lü Daliang. He added that cross-border logistics have become more convenient, cost‑reduction and efficiency‑enhancement are more pronounced, and the momentum for innovative development has grown stronger.
Going forward, Lü Daliang stated that the General Administration of Customs will continue to closely monitor the implementation of policy measures, while also gaining a deeper understanding of the expectations and concerns of enterprises and local governments. Focusing on key priorities such as stabilizing and expanding exports, diversifying markets, and providing targeted support to businesses, the Administration will strengthen its stockpile of policies and measures to ensure stable foreign trade, introduce new measures as needed, help enterprises secure orders and expand into new markets, and contribute to maintaining the overall scale of foreign trade while improving its structure.

A Comprehensive Assessment of A-Share Listed Companies: Six Distinctive Features Emerge, with the Overall Structure Continuously Optimizing
Three years ago, the State Council issued the “Opinions on Further Enhancing the Quality of Listed Companies,” establishing a national-level institutional framework for improving the quality of listed offices. Over the past three years, listed companies have leveraged the capital market to accelerate their development, with notable improvements in their structural composition. Their overall governance, competitiveness, innovation capacity, risk resilience, and ability to deliver returns have all continued to strengthen, driving steady progress toward greater excellence and robustness.
Market participants note that, from the perspective of listed companies, the A-share market has seen improvements in both volume and quality, serving as a stabilizing force in areas such as technological innovation, job creation, and economic stability. The continued strengthening of listed offices’ profitability, coupled with the deepening trend of survival of the fittest, is helping to elevate the overall quality of the listed‑company base, which bodes well for fostering a trustworthy and healthy market ecosystem over the long term.
Feature 1: The overall structure is continuously optimized.
Market‑oriented M&A and restructuring mechanisms, coupled with a regulatory environment that ensures fair competition in the capital markets, have given rise to a wave of listed companies characterized by high technological content and strong growth potential, with many emerging as standouts amid the industry’s rigorous selection process.
On the one hand, this is reflected in the structural transformation between “new” and “old” industries. Traditional industry leaders in sectors such as steel and construction have ramped up R&D investment, breathing new life into time‑honored industries; meanwhile, emerging sectors like integrated circuits, biopharmaceuticals, and high‑end equipment manufacturing have seen listed companies form cluster effects. Among the more than 5,000 listed offices, nearly 2,600 are engaged in strategic emerging industries, accounting for over 51%. A cohort of high‑quality technology enterprises—including China Mobile, CATL, and BYD—have surged ahead in the competitive tide of the capital markets, becoming shining stars. On the other hand, there has been structural optimization between the financial sector and the real economy. Listed financial institutions have intensified their support for the real economy, and in recent years, the share of profits generated by real‑economy‑focused listed companies has begun to surpass that of the financial sector, leading to a marked improvement in the previously lopsided structural balance between finance and the real economy.
Notably, the structure between private and state-owned enterprises has become more balanced. State‑owned listed companies are large in scale and high in quality, with a host of corporate giants—including the six major state banks, the “three oil majors,” and the three major telecom operators—all represented on the A‑share market. Private‑sector listed companies account for more than two-thirds of the total, and in recent years, they have made up over 80% of new listings. The coexistence of massive state‑owned enterprises and a vast number of private offices competing on the same stage has become a defining feature of China’s modern capital market.
“In recent years, the industry structure of listed companies has increasingly tilted toward emerging sectors, with both their enthusiasm for and capacity for R&D and innovation steadily improving,” noted a representative from Ping An Securities. The official added that listed offices have leveraged mergers and acquisitions to strengthen their innovation-driven development mechanisms, which are gradually maturing, while capital market reforms have accelerated their transition to high-quality growth.
Chen Li, chief economist at Chuancai Securities, stated that current M&A and restructuring activities among listed companies are primarily driven by asset integration, diversification strategies, and industrial transformation. An increasing number of listed offices seek to achieve greater optimization of resource allocation and governance structures through such transactions, which has, in turn, bolstered the overall valuation and attractiveness of the A-share market.
Feature Two: Governance Capacity Has Been Significantly Enhanced
In recent years, listed companies have placed greater emphasis on corporate governance, fostering a favorable environment for sound governance. A number of benchmark cases with exemplary governance practices and concrete, effective approaches have emerged, and overall, the governance standards of listed companies have improved markedly.
It has been learned that, as of now, conspicuous governance issues—such as directors, supervisors, and senior executives serving beyond their statutory terms, irregular operations of the three boards, and the absence of established internal systems—have largely been rectified. A number of individual cases involving control‑rights disputes, loss of control over subsidiaries, unauthorized use of funds or guarantees, and intra‑industry competition have also been resolved. Moreover, most listed companies have put in place long‑term corporate governance mechanisms; by establishing internal accountability frameworks and revising and refining the arrangements governing the responsibilities, powers, and interests of the three boards and the management layer, they are accelerating the consolidation of endogenous governance momentum.
In particular, a large number of targeted and highly practical corporate governance rules—such as the “Notice on Standardizing Business Transactions Between Listed Companies and Corporate Group Finance Companies” and the “Notice on Further Enhancing the Effectiveness of Internal Controls over Financial Reporting in Listed Companies”—have been revised and issued, further strengthening the foundation of sound corporate governance. The revision of regulations pertaining to independent directors responds to market demands and reinforces the modern enterprise system with Chinese characteristics.
A representative from Ping An Securities stated that regulatory authorities, by means of rules and institutional frameworks, are stimulating endogenous growth momentum, enhancing corporate governance standards, guiding listed companies toward compliant operations, and strengthening the sense of responsibility and accountability among both the companies themselves and the “key few.” This effort is also aimed at establishing and improving internal control systems and oversight mechanisms, ensuring that power operates within a robust institutional framework and further refining corporate governance.
Feature Three: Continuously Strengthening Return Capability
According to authoritative data, in 2022, a total of 3,291 listed companies on the Shanghai and Shenzhen stock exchanges distributed cash dividends, accounting for 67.1% of all listed companies at year-end. The aggregate amount of cash dividends paid throughout the year reached RMB 2.06 trillion, with RMB 1.62 trillion attributable to A-share shareholders. Many A‑share listed companies have now become “cash cows,” consistently paying dividends without seeking additional financing, and the overall dividend payout has consistently exceeded new equity financing raised by the market. In international comparisons, China’s domestic market ranks first among major global securities markets in terms of the number of dividend-paying listed companies, second globally in total cash dividend payouts, and second worldwide in the proportion of companies that distribute dividends.
The aforementioned securities industry insider noted that in recent years, the overall scale of dividends paid by A-share listed companies has grown significantly, driven both by sustained profit growth at many offices and by a steadily rising willingness to distribute dividends.
From 2012 to the present, the annualized average growth rate of total dividends has been 13.3%, outpacing the average growth rate of total net profits over the same period (around 10%). The share of listed companies that pay dividends has risen from roughly 50% prior to 2010 to a recent median level of about 70%, reflecting a gradual strengthening of dividend‑paying practices. Moreover, the sustainability and growth of dividends have continued to improve: the proportion of offices that have paid dividends for five consecutive years has increased from 20% a decade ago to 48%, while the share of companies with ten consecutive years of dividends has climbed from 8% to 31%.
Feature Four: Ongoing Mitigation of Risk Factors
At one time, issues such as major shareholders of listed companies pledging their shares and controlling shareholders siphoning off listed offices through unauthorized appropriation and guarantees had become increasingly prominent, posing significant risks to the capital market.
According to authoritative data, following sustained regulatory efforts, the number of companies with a high proportion of shares pledged has fallen from over 700 at its peak to just over 270 today—a reduction of more than 60 percent. Meanwhile, the share of market capitalization tied up in pledges has declined from 10% to 4.1%. The spiral‑downward dynamics triggered by forced liquidation of pledged shares are now a thing of the past, enabling listed companies affected by large shareholders’ high pledge ratios to operate with greater financial flexibility. Furthermore, the compliance rate for rectifying illegal occupation and guarantee violations has reached 90%, ensuring robust protection of listed companies’ interests and subjecting those responsible for infringing such interests to legal sanctions.
Corporate bankruptcy reorganization is a crucial mechanism for mitigating corporate risks. By undertaking such restructuring, listed companies can substantially enhance corporate governance, optimize their core businesses and asset structures, and extricate themselves from operational difficulties. Since 2019, more than 50 listed companies have entered bankruptcy reorganization proceedings.
Feature Five: The market’s survival-of-the-fittest trend is accelerating.
The delisting regime is a foundational pillar of the capital market. A stable and healthy capital market necessarily requires smooth entry and exit mechanisms, fostering a market ecosystem characterized by both inflows and outflows and sustained positive feedback. Data show that since the introduction of the new delisting rules in 2020, diversified exit channels have become more accessible, and market expectations have grown clearer. Since the reform began, a total of 124 companies have been delisted, including 103 through mandatory delisting, 2 via voluntary delisting, and 19 through restructuring‑related delisting.
Notably, the number of companies delisted through mandatory procedures has surpassed the cumulative total since the inception of the capital market. Market observers note that the deepening trend of survival of the fittest is helping to enhance the overall quality of listed offices and will, in the long run, be conducive to fostering an honest and healthy market ecosystem.
Feature Six: Signals of a second-half earnings rebound are steadily strengthening.
Looking back over the past three years, A-share listed companies have proactively addressed the challenges posed by the pandemic, posting average annual compound growth rates of 12% in operating revenue and 14% in net profit. Meanwhile, R&D intensity rose from 1.81% at the end of 2019 to 2.03%, effectively bolstering both profitability and innovation capacity. In the first half of 2023, nearly 80% of Shanghai and Shenzhen‑listed A‑share companies reported profits; although non‑financial listed offices account for only 1% of all large‑scale industrial enterprises nationwide, their combined profits represented 60% of the national total for that period.
Focusing on the interim reports of listed companies, we see numerous bright spots in the performance of real‑economy listed offices, and signs of stabilization are becoming increasingly evident.
On the consumption front, listed companies in discretionary sectors such as passenger vehicles and telecommunications equipment posted year-on-year growth in net profits that accelerated markedly compared with the first quarter, signaling a clear improvement in earnings momentum.
On the export front, since the onset of the pandemic, the industry mix of listed companies’ overseas revenues has shown a clear trend: a decline in electronics and a rise in new energy and automotive sectors. Together, the share of new energy and automotive products and their components has increased by nearly 6 percentage points, approaching 20% and surpassing that of electronics. The accelerated international expansion of the new energy and automotive value chains is likely to propel a rebound in the growth rate of overseas revenues in the second half of the year.
On the investment front, in the second quarter, listed companies’ total fixed‑asset investment reached RMB 1.2 trillion, up 18.7% year over year—a pace that marks the fastest quarterly growth since 2022, signaling an upward trend in investment and potentially spurring a broader uptick in overall fixed‑asset investment across the economy.
Market participants note that macroeconomic indicators are trending upward, with August seeing a broad-based improvement across the board. Year-on-year and month-on-month growth in consumption, investment, industrial output, the service sector, and property sales all exceeded previous levels, which should help reverse the earnings cycle for listed companies and further support valuation recovery.

The National Administration of Financial Regulation has issued a risk warning.
On October 13, the website of the National Administration of Financial Regulation issued a risk warning urging vigilance against fraud perpetrated through emerging AI technologies.
The National Administration of Financial Regulation stated that, at present, the widespread application of AI technologies has provided the public with personalized, intelligent information services, while also creating opportunities for cyber fraud. For instance, criminals use techniques such as facial replacement and voice synthesis to produce fake images, audio, and videos, impersonate others to carry out scams, and thereby infringe upon consumers’ legitimate rights and interests. In response, the National Administration of Financial Regulation has issued a risk warning on consumer rights protection, urging financial consumers to remain vigilant against emerging fraud schemes and safeguard their personal and family assets.
Fraudulent schemes leveraging cutting-edge AI technologies primarily employ two methods: “voice synthesis” and “face swapping.” These techniques involve mimicking another person’s voice or likeness to gain trust and subsequently swindle money. Perpetrators typically pose as “online store customer service,” “marketing promoters,” “part-time job recruiters,” or “dating/relationship‑seeking platforms,” contacting victims via WeChat, QQ, phone calls, and other channels to collect audio recordings, speech patterns, or facial data. They then use voice‑synthesis and face‑swapping tools to generate fake audio, video, or images that impersonate the victim, luring their family and friends into transferring funds under pretenses such as borrowing money, making investments, or providing emergency assistance, or prompting them to disclose sensitive information like bank account passwords—after which the stolen funds are swiftly siphoned off. Moreover, criminals may artificially synthesize audio and video of celebrities, experts, officials, and others, exploiting their identities to spread false information and further their fraudulent objectives.
These types of scams are highly deceptive and covert, often involving substantial sums of money. To safeguard the legitimate rights and interests of the general public as financial consumers, the National Administration of Financial Regulation hereby advises:
First, what you see on online platforms isn’t always what it seems. A key feature of synthesis technologies such as “voice cloning” and “face-swapping” is their ability to create highly convincing fakes. Criminals can exploit these tools to impersonate others, rapidly target specific groups, and tailor fraudulent scripts to carry out precision‑targeted scams. Consequently, when financial transactions are involved, even a “familiar voice on the phone” or a “video that appears to be from an acquaintance” could be part of a scammer’s scheme. Consumers should remain vigilant.
II. Always verify the other party’s identity before making any bank transfers or remittances. If someone claiming to be an “acquaintance,” a “leader,” or another contact uses social media, phone calls, or other means to solicit funds under various pretexts, be sure to conoffice their identity. During communication, you can ask questions known only to the two of you; alternatively, use another form of communication or meet in person to verify their identity, or check with their friends or family to conoffice their identity and circumstances. If you cannot reliably conoffice the other party’s identity, refrain from making any transfers whenever possible.
III. Safeguard Personal Information Such as Photos and Voice Recordings. Consumers should enhance their awareness of personal data protection by refraining from downloading unfamiliar apps, registering on untrusted platforms, or adding unknown contacts, and by remaining vigilant about the security of their social media accounts. Avoid excessively exposing personal photos, voice recordings, videos, and other sensitive information online, and do not store copies of your ID card or bank card images directly on your phone for convenience. If you fall victim to fraud or encounter suspicious circumstances, be sure to preserve evidence and report the incident immediately to the local public security authorities.

Regulations Clarified: During the IPO review process, investment banks are required to conduct due diligence on four major areas, with significant public sentiment serving as one of the key factors.
Recently, the Shanghai Stock Exchange issued the latest edition of its “Shanghai Stock Exchange Issuance and Listing Review Updates” to sponsoring institutions. In light of this, the Exchange has further clarified the additional matters that sponsoring institutions are required to continuously scrutinize through due diligence during the review period, beyond responding to review inquiries.
In the SSE’s view, sponsoring institutions should remain vigilant regarding the four major categories of matters relevant to a project and diligently fulfill their due‑diligence obligations, which include changes in the IPO applicant’s external environment, the issuer’s own operating conditions, litigation and legal proceedings involving the issuer, as well as significant media reports and market rumors.
Regulators have stipulated that, during the issuance and listing process, if an IPO‑eligible company becomes the subject of significant public scrutiny, the sponsor shall promptly report to the Shanghai Stock Exchange and submit a special verification opinion; concurrently, when filing the registration documents, it must also submit an updated special verification report on the relevant public sentiment.
The sponsor institution shall establish a mechanism for managing public opinion.
In accordance with the relevant provisions of the Shanghai Stock Exchange’s Rules for the Review of Stock Issuance and Listing, if a material event occurs between the acceptance of the issuance and listing application and the commencement of trading of the shares, the issuer and its sponsor shall promptly report such event to the SSE and update the issuance and listing application documents as required. The sponsor and other securities service institutions shall continue to fulfill their due diligence obligations and submit special verification opinions to the SSE.
The SSE emphasizes that issuers and their sponsoring institutions must closely monitor significant media reports and market rumors concerning the issuer. In the view of the regulatory authorities, if such reports or rumors differ materially from the issuer’s disclosed information and the matters involved could have a substantial impact on this offering and listing, the issuer shall provide explanations to the SSE and fulfill its information disclosure obligations in accordance with applicable rules; meanwhile, the sponsoring institution and other securities service providers shall conduct necessary due diligence and report the results thereof to the SSE.
According to the Shanghai Stock Exchange, following the acceptance of an issuance and listing application, the sponsor institution shall remain vigilant regarding material matters pertaining to the project and duly fulfill its due diligence obligations.
First, the changes in the external environment, including developments in industry policies and regulatory requirements applicable to the issuer.
Second, the issuer’s own operating performance, including its post‑period financial condition, changes in existing orders, the utilization of key assets, the stability of business operations, and the impact on production and operations.
Third, the status of litigation and related matters, including whether the issuer and its material subsidiaries are involved in any significant lawsuits or disputes, and whether the issuer, its controlling shareholders, or its actual controller have been suspected of illegal or criminal conduct and subjected to formal investigations.
Fourth, the impact of major news reports, market rumors, and specific matters raised in complaints or reports on the issuer’s information disclosure and its operations and production.
The SSE stated that, in response to significant public sentiment, sponsoring institutions shall establish a mechanism for managing public opinion. Should major public sentiment arise during the issuance and listing process, they must promptly report it to the SSE and submit a special verification opinion. In addition to conducting a dedicated review of the issuer’s historical public sentiment and submitting a corresponding verification report at the time of the initial filing, as required by “Shanghai Stock Exchange Issuance and Listing Review Business Guide No. 2—Documents for Issuance and Listing Applications,” sponsors must also update and submit a special public‑sentiment verification report concurrently with the submission of the registration documents.
Major negative public sentiment surrounding an IPO has drawn regulatory attention.
Over the past year, regulators have paid increasing attention to negative public sentiment arising during the review process of companies seeking an IPO.
It has been noted that, during the IPO review process, some companies seeking to go public have been subject to inquiries from the stock exchange, which has requested explanations regarding issues raised in media reports.
Some investment banks and sponsor representatives have received regulatory penalties for failing to promptly verify significant negative public sentiment. On September 25, Galaxy Securities, along with its sponsor representatives Chen Zhaojun and Yao Zhaowu, were issued a written reprimand by the Shenzhen Stock Exchange. According to reports, in the HuaYao Optoelectronics ChiNext IPO project, one of the violations committed by Galaxy Securities and its sponsor representatives was their failure to timely investigate major adverse public commentary concerning the issuer and to proactively report such information to the exchange.
The Shenzhen Stock Exchange stated that, during the review process, the media extensively reported on multiple instances of significant regulatory penalties imposed on Xun Jianhua and related matters, thereby raising doubts about the issuer’s compliance and legality in this offering and listing. The sponsor and the sponsor’s representative failed to closely monitor major negative reports concerning the issuer; prior to the Exchange’s inquiries and requests for verification, they did not, as required, promptly investigate such adverse public sentiment and proactively report it, resulting in the continued escalation of negative publicity and severe market repercussions.
Recently, in the IPO case of Zhejiang Guoxiang, the stock exchange responded swiftly to negative public sentiment. According to reports, certain self-media outlets highlighted issues such as the company’s dual listing of the same asset and a relatively high offering price. In response, the Shanghai Stock Exchange stated that, in line with its commitment to market and investor accountability, it has launched a special review of Zhejiang Guoxiang based on the concerns raised by these self-media platforms.
Zhejiang Guoxiang stated that, in order to effectively safeguard investors’ interests, the issuer and the lead underwriter have decided to suspend further issuance activities and will resume them only after the relevant matters have been verified and clarified. The sponsor, Orient Securities Underwriting & Sponsorship, has also provided detailed explanations regarding the underwriting fees and the investment situation.
With the full implementation of the registration-based system for A‑shares now underway for half a year, industry insiders point out that, as the reform progresses, issuers, intermediary institutions, stock exchanges, the China Securities Regulatory Commission, and the media must each fulfill their respective roles and responsibilities in accordance with information‑disclosure requirements. Specifically, issuers bear primary responsibility for disclosure, intermediary institutions serve as “gatekeepers,” and the media should exercise objective, professional, and fact‑based oversight.

Commercial & Corporate
Adjustment of Responsibilities among the Ministry of Industry and Information Technology and Other Departments
The General Office of the CPC Central Committee and the General Office of the State Council recently issued a notice to adjust the functions, responsibilities, and organizational structure of the Ministry of Industry and Information Technology, the Ministry of Ecology and Environment, the National Health Commission, and the People’s Bank of China, as well as to revise the duties of the Chinese Academy of Social Sciences.
With regard to the responsibilities and institutional adjustments of the Ministry of Industry and Information Technology, the following changes have been made: The functions of the Ministry of Science and Technology—namely, formulating plans and policies for the development and industrialization of high‑tech industries; guiding the construction of national independent innovation demonstration zones, national high‑tech industrial development zones, and other science and technology parks; and providing guidance on the development of science‑and‑technology service industries, technology markets, and science‑and‑technology intermediary organizations—have been transferred to the Ministry of Industry and Information Technology. In addition, the State Council Leading Group for Promoting the Development of Small and Medium‑Sized Enterprises and its office have been abolished, with the specific tasks now entrusted to the Small and Medium‑Sized Enterprise Bureau of the Ministry of Industry and Information Technology.
With regard to the responsibilities and institutional adjustments of the Ministry of Ecology and Environment: the responsibility of the Ministry of Science and Technology to formulate plans and policies for promoting ecological and environmental protection through science and technology has been transferred to the Ministry of Ecology and Environment. The Leading Group for Air Pollution Prevention and Control in the Beijing–Tianjin–Hebei Region and Surrounding Areas, along with its office, will no longer be retained. The Atmospheric Environment Department of the Ministry of Ecology and Environment will no longer concurrently bear the nameplate of the Beijing–Tianjin–Hebei and Surrounding Areas Atmospheric Environment Administration. Furthermore, the Central Ecological and Environmental Protection Inspection Office, an internal unit of the Ministry of Ecology and Environment, has been renamed the Central Ecological and Environmental Protection Inspection Coordination Bureau, and its description of duties has been revised from “undertake the day-to-day work of the State Council Leading Group for Ecological and Environmental Protection Inspection” to “undertake the specific affairs of the Office of the Central Ecological and Environmental Protection Inspection Leading Group.”
With regard to the functions and institutional adjustments of the National Health Commission: the responsibility of the Ministry of Science and Technology to formulate plans and policies for promoting health‑related scientific and technological development has been transferred to the National Health Commission. The responsibilities of the National Health Commission to draft and coordinate the implementation of policies and measures to address population aging, as well as to undertake the specific work of the National Committee on Aging, have been transferred to the Ministry of Civil Affairs. The China Association of the Elderly, which was previously under the administration of the National Health Commission, will now be placed under the administration of the Ministry of Civil Affairs.
With regard to the adjustment of the People’s Bank of China’s functions: the State Council Financial Stability and Development Committee and its office will no longer be retained. The responsibilities of the State Council Financial Stability and Development Committee Office will be transferred to the Office of the Central Financial Commission. The day-to-day regulatory responsibilities for financial holding companies and other financial groups will be assigned to the National Administration of Financial Regulation. The responsibility for establishing and improving the basic system for protecting financial consumers will also be transferred to the National Administration of Financial Regulation.
With regard to the adjustment of the functions and related matters of the Chinese Academy of Social Sciences: the responsibility for overseeing the China Local Records Guidance Group will no longer be retained. The Office of the China Local Records Guidance Group will be renamed the Office of Local Records Work, and will continue to bear the designation of the National Local Records Museum. The Office of Local Records Work will be administered by the Chinese Academy of Social Sciences on behalf of the Central Leading Group for Propaganda, Ideology, and Cultural Work.
Meanwhile, the organizational structure, administrative staffing, and leadership positions of the relevant departments have also been adjusted.

Three departments have issued the “Notice on Strengthening the Verification of Audit Reports.”
Recently, the Ministry of Finance, the State-owned Assets Supervision and Administration Commission of the State Council, and the National Administration of Financial Regulation jointly issued the “Notice on Strengthening the Verification of Audit Reports” (hereinafter referred to as the “Notice”), stipulating that accounting offices shall, in accordance with relevant regulations, upload the audit reports they have prepared to the Unified Regulatory Platform for the Certified Public Accountant Profession (website: http://acc.mof.gov.cn; hereinafter referred to as the “Regulatory Platform”) and apply for a code.
Accordingly, users of audit reports—including audited entities, banks, the general public, and regulatory authorities—can, through a unified regulatory platform, verify whether an audit report was issued by an accounting office duly licensed to practice and whether it has been filed on the platform, thereby obtaining key information such as a nationally standardized verification code. This measure is intended to more effectively curb and rectify practices such as the falsification of accounting data and audit reports, enhance the quality of audits and accounting information, and enable the certified public accountant profession to play a healthy and constructive role in upholding market order and supporting national development.
Refine the operational details of the query process.
As an essential tool for assessing a company’s financial condition and operational performance, the authenticity and accuracy of audit reports are critical to safeguarding the legitimate rights and interests of enterprises and their stakeholders. The issuance of false audit reports constitutes a flagrant infringement of investors’ lawful rights and a deliberate undermining of the market economy’s order, and its culpability must not be overlooked. To more effectively combat illegal and criminal acts involving falsified audit reports and to address systemic issues in the capital markets—such as the manipulation of accounting data, fictitious transactions, the embellishment of financial statements, and financial fraud—the Ministry of Finance and other relevant authorities have placed the focus of regulatory efforts on “leveraging information technology.”
On June 30, 2022, the regulatory platform was officially launched and put into operation. The platform covers all stages of the full lifecycle oversight of accounting offices and certified public accountants, enabling “one-stop submission, one-stop processing, and one-stop completion” for relevant matters. Regulatory authorities, report users, and the general public can verify the authenticity of audit reports through various methods, including scanning a QR code via WeChat—making the process simple, convenient, and universally applicable nationwide.
The newly issued “Notice” further specifies and implements the operational details of relevant procedures, such as inquiries and code assignment.
According to the Notice, the unified regulatory platform includes an “Audit Report Verification” function, enabling users of audit reports to verify them by entering the query code located in the lower-right corner of the report—provided by either the audited entity or the accounting office—or by accessing the electronic or paper version of the audit report.
Based on the information available to users of audit reports, three distinct verification methods are provided: First, quick verification. Users who have the query code can use it to retrieve details such as the accounting office’s name, the names of the certified public accountants who signed the report, the audited entity’s name, and the date the audit report was issued. Second, uploaded‑audit‑report verification. Users who possess an electronic copy of the audit report may directly upload it for verification. Third, report‑code and key financial‑statement‑indicator verification. Users who have both the audit report’s code and key financial‑statement indicators—such as total assets, total liabilities, total profit, and total revenue—can enter these codes and indicators to perform a verification.
Continuously narrowing the scope for audit fraud.
According to a relevant official from the Ministry of Finance, since its launch, the regulatory platform has enabled the issuance of a nationwide, standardized verification code for audit reports filed by accounting offices. Accounting offices are required to strengthen their audit report filing procedures, ensuring that all reports subject to filing are duly submitted, thereby laying the groundwork for the verification of audit reports.
According to the Notice, the regulatory platform is the sole legally authorized platform for filing audit reports, assigning verification codes, and conducting inspections; accounting offices are strictly prohibited from obtaining or using false verification codes through any unlawful means.
The Notice specifies the detailed procedures for assigning a code to audit reports: Before delivering the audit report to the client, the accounting office shall enter the relevant information into the unified regulatory platform, upload the draft of the formal audit report, and apply for the assignment of a code. The regulatory platform will then assign a verification code to the audit report and automatically encrypt and store it. When uploading the audit report, it must bear the official seal of the accounting office and the signature and seal of the certified public accountant; for annual financial statement audit reports, the official seal of the audited entity must also be affixed to the financial statement pages.
In recent years, China’s capital market has grown rapidly, and the certified public accountant (CPA) profession has experienced swift expansion. Originally, accounting offices were meant to serve as the “gatekeepers” of financial reporting and the capital market, scrutinizing corporate financial statements for errors and irregularities. However, in their quest to capture market share and resources, some offices have turned a blind eye to the financial and legal risks associated with companies’ suspected violations of laws and regulations—and have even gone so far as to “beautify and conceal” such issues. Even more troubling, some have brazenly flouted the law, crossing the regulatory red lines of the securities and capital markets, thereby facilitating the falsification of annual financial reports by certain listed companies and effectively transforming themselves from gatekeepers of capital into mere “informants.”
To this end, China has strengthened regulatory oversight of the financial capital markets, with enforcement efforts steadily intensifying. From the Ministry of Finance’s issuance of guidelines to bolster the integrity of accounting professionals, to the establishment of a “blacklist” system and a joint punitive mechanism for those with serious breaches of trust, and further to the draft amendment to the Accounting Law—which has remained at the forefront of legislative debate in recent years—the room for accountants to engage in fraudulent accounting practices has been steadily narrowed, leaving no hiding place for acts of accounting misconduct.
At present, the Ministry of Finance is continuously exploring innovative approaches to the management of certified public accountants and accounting offices. For instance, in February 2022, the Ministry issued the Measures for the Administration of Self‑Inspection and Self‑Rectification Reports by Accounting Offices, mandating that accounting offices establish an annual self‑inspection and self‑rectification reporting system to comprehensively identify risk factors and accurately, thoroughly, and in detail disclose any issues, corrective measures, and completion timelines across the following areas. On July 1 of the same year, the Ministry released the Measures for the Supervision and Inspection of Accounting Offices, implementing a tiered and categorized regulatory framework for the certified public accountant profession.
Those who have not been assigned a health code will be subject to heightened scrutiny.
To strengthen the effectiveness of verifying audit reports on the online platform, the Notice requires accounting offices to proactively provide audited entities with audit reports that include a verification code. Users of audit reports are required to check whether the reports they obtain bear such a code and may verify it through the unified regulatory platform or by using a mobile “scan” function. In areas where audit reports are widely used—such as audits of state-owned enterprises and credit reviews of banking and financial institutions—the finance authorities, state‑owned asset supervision and administration agencies, and financial regulatory bodies shall prioritize the application of audit report verification codes, and shall urge and guide relevant entities to obtain from accounting offices audit reports bearing verification codes and to carry out the requisite verification.
The Notice also sets forth clear accountability requirements: The Ministry of Finance will promptly notify the China Banking and Insurance Regulatory Commission of the list of accounting offices that have failed to file as required, have not implemented corrective measures as mandated, or have been designated as key targets for supervisory inspections. The China Banking Association is responsible for forwarding this list to banks, which are required to give heightened scrutiny to reports issued by the relevant accounting offices during credit review processes.
Shi Zhengwen, Director of the Research Center for Fiscal and Tax Law at China University of Political Science and Law, argues that the issue of false audit reports warrants close attention because it directly threatens the proper functioning of the economic system. For instance, an unqualified opinion issued without detecting falsification: when a company’s financial condition is problematic, auditors may deliberately turn a blind eye and issue a spurious certificate of sound financial health. Another scenario is an unqualified opinion that conceals material misstatements: auditors, fully aware of the company’s issues, intentionally withhold this information, enabling the office to evade oversight and exposing investors and other stakeholders to substantial risks. Yet another form is an inappropriate qualified opinion: when a negative opinion should be rendered but a qualified one is instead issued, thereby providing unlawful cover for the company’s violations.
The most direct harm caused by falsified audit reports is the infringement of the legitimate rights and interests of corporate shareholders and creditors, resulting in economic losses for them. At the same time, such practices—by concealing revenues and falsely inflating expenses to evade national taxes—lead to a loss of government tax revenue. They also undermine the integrity of national financial and economic laws and regulations as well as the accounting system. In particular, they expose China’s still‑maturing securities market to a barrage of false and misleading information, seriously misguiding investors, undermining the rules of the market, intensifying speculation and volatility, and jeopardizing social stability. “By stepping up enforcement against all forms of accounting fraud and audit‑report falsification, raising the cost of violations, and supporting the development of an ethical accounting framework, we can effectively prevent and curb the rampant spread of such fraudulent auditing practices,” said Shi Zhengwen.

Two departments have jointly launched a special campaign to address fraudulent certification practices.
The State Administration for Market Regulation and the Ministry of Public Security recently jointly issued the “Notice of the State Administration for Market Regulation and the Ministry of Public Security on Launching a Special Rectification Campaign Against False Certification,” jointly deploying a three-month special campaign to crack down on illegal practices involving false certification, enhance the effectiveness and credibility of quality certification, and foster a market environment characterized by honesty, trustworthiness, and fair competition.
The notice emphasizes the need to severely crack down on illegal practices such as certification bodies buying and selling certificates, engaging in fraudulent certification, conducting certification activities without authorization, and forging or misusing certification certificates and inspection‑testing reports, thereby resolutely curbing the spread of false certification. It also calls for a focused cleanup of online trading platforms to remove information—such as “certificates/reports issued on the same day,” “direct issuance of certificates,” “no sample submission required for testing,” and “guaranteed pass”—that constitutes suspected false certification or misleading advertising, thus regulating the online marketing of certification services. Relevant fake and illegal websites are to be shut down in accordance with the law to address false certification transactions at their source. Furthermore, strict enforcement of principal responsibility is required, urging certification bodies and online trading platforms to conduct self‑inspections and rectifications in compliance with applicable laws and regulations, continuously improving the standardization of certification practices.

Taxation
A Look at the Consumption Boom During the Mid-Autumn and National Day Holidays Through Tax Big Data
The State Taxation Administration leveraged VAT invoice data, supplemented by enterprise survey findings, to analyze nationwide sales revenue trends across relevant industries during the Mid-Autumn and National Day holiday period. The results indicate that during this holiday season, the consumer market remained robust and vibrant, with sales revenue in consumption‑related sectors rising 21.3% year over year. Specifically, service‑sector consumption increased by 20.9%, while merchandise consumption grew by 21.6% compared with the same period last year.
During the Mid-Autumn and National Day holiday period, driven by the extended “golden week” effect, residents’ travel and tourism activities surged, with tourist markets across the country remaining robust. Revenue from tourism and sightseeing services increased 110% year on year. In particular, the recovery of long-distance and outbound tours boosted revenue in the travel agency and related service sectors by 170% year on year; revenue from scenic spots and leisure‑tourism activities rose 200% and 43.8%, respectively; and amusement parks, with their growing appeal to visitors, saw a year-on-year revenue increase of 81.2%.
According to reports, Beijing welcomed 11.879 million tourists, a year-on-year increase of 48.9% on a comparable basis and a 12.9% rise compared with 2019. Average per capita spending by visitors in the city reached RMB 1,319.6, up 39.9% from the previous year and 8.0% higher than in 2019. The cultural and tourism sector is experiencing a robust recovery.
The Beijing Municipal Tax Service of the State Taxation Administration leveraged big data from VAT invoices to analyze sales revenue across relevant sectors in the city. The findings indicate that during the Mid-Autumn and National Day holidays, Beijing’s holiday consumer market remained robust, with strong pent-up demand in retail, catering, and entertainment driving a year-on-year increase of 66.1% in sales revenue for these industries.
The manager of a Peking duck restaurant in Beijing said that even before the 10:30 a.m. opening, the line outside was already packed, with most customers being out-of-town tourists who had come specifically to try it. According to a company official, this year’s sales at all locations have been significantly stronger than in previous years, with overall holiday revenue up more than 40% year over year.
The eight-day “enhanced” holiday has ignited public enthusiasm for travel, driving robust growth across the national cultural and tourism markets. A senior official at a travel agency noted, “This year, with the Mid-Autumn Festival and National Day falling on the same week, people’s desire to travel is strong, and the travel services sector has staged a vigorous recovery, with both domestic and international tourism volumes posting steady increases.”
“The tourism sector is booming, significantly boosting consumption in Chongqing,” said a responsible official from the Tax and Economic Analysis Division of the Chongqing Municipal Tax Service. During the dual holiday period, numerous districts across Chongqing hosted shopping festivals, music festivals, anime events, fireworks displays, and other activities, fueling a surge in tourism-related spending. According to VAT invoice data, compared with the 2019 National Day holiday, sales revenue for travel agencies and related services in Chongqing increased by a factor of 22.5.
Urban tourism and nature‑based travel are booming, while cultural, sports, and entertainment activities are thriving. During this year’s Mid-Autumn and National Day holiday, with the staging of major events such as the second Chongqing Urban Arts Festival, the 15th China Western Animation and Comic Culture Festival, and the launch ceremony for the 2023 Chongqing Autumn Tourism Season, Chongqing’s cultural, sporting, and recreational offerings entered a “golden week.” According to VAT invoice data, during the extended holiday period, sales revenue in Chongqing’s culture, sports, and entertainment sectors rose by 235.7% compared with the 2022 National Day holiday and by 438.1% compared with the 2019 National Day holiday. Specifically, revenue from literary and artistic creation and performance, mass cultural and sports activities, and fitness and leisure activities increased by 1,357.9%, 975.9%, and 106.6%, respectively, relative to the 2019 National Day holiday.
During the Mid-Autumn and National Day holiday, driven by robust residential travel and tourism spending, revenue from accommodation and catering services rose 25.5% year over year. Specifically, revenue from tourist hotels, campground services, and homestay services increased by 130%, 150%, and 45.5%, respectively, compared with the same period last year.
This year’s Mid-Autumn and National Day “double holiday” coincided with the highly popular Second Hunan Provincial Tourism Development Conference, ushering in the busiest Golden Week in Chenzhou’s history. The city welcomed a total of 3.2728 million tourists, up 114.6% year on year, with total tourism revenue reaching RMB 3.36 billion, an increase of 107.72%. Ticket revenues from 35 major tourist attractions amounted to RMB 141.88 million, up 104.53% compared with the same period last year.
“This holiday season, the entire village welcomed over 1,500 tourists—30% more than last year—with total revenues of approximately RMB 600,000, up by one-third year on year. The booming popularity of homestays owes much to robust tax support.” In Chenzhou, Hu Ding, general manager of a local homestay, did the math: “This year, our business benefited from tax and fee reductions totaling RMB 66,000—including exemptions from property and land taxes and relief on six taxes and two fees for small and micro‑enterprises—equivalent to the monthly salaries of more than ten employees, which has significantly eased the financial strain associated with upgrading and improving our facilities.”

Litigation & Arbitration
The Supreme People’s Court has issued guidelines to safeguard, in accordance with the law, the property rights of private enterprises and the legitimate rights and interests of entrepreneurs.
On the 10th, the Supreme People’s Court held a press conference to release details of the “Guiding Opinions of the Supreme People’s Court on Optimizing the Rule-of-Law Environment and Promoting the Development and Growth of the Private Sector” (hereinafter referred to as the “Guiding Opinions”).
Lin Wenxue, Chief Judge of the Second Civil Division of the Supreme People’s Court, stated that the “Guiding Opinions” adopt a problem‑oriented approach, setting forth clear requirements for adjudication and enforcement work across six key areas. Through 27 provisions, they implement and further refine the 19 measures outlined in the “Opinions on Promoting the Development and Growth of the Private Sector,” issued by the CPC Central Committee and the State Council.
The Guiding Opinions state that efforts shall be strengthened to safeguard the legitimate rights and interests of entities in the private sector; judicial interpretations shall be formulated to impose stricter penalties for corruption by employees of private enterprises and to enhance the recovery of illicit gains; a sound, regularized mechanism for rectifying wrongful convictions shall be established; and the right of private-sector entities to seek state compensation shall be protected in accordance with the law.
The Guiding Opinions place particular emphasis on protecting the personality rights of private enterprises and their entrepreneurs, fully leveraging the effectiveness of the injunction system for infringements of personality rights to promptly halt unlawful acts that violate such rights.
With regard to extreme rhetoric that deliberately misleads the public and seeks to attract attention, as well as infringing acts such as defamation, disparagement, and vilification of private enterprises and entrepreneurs carried out through online platforms, self-media, publications, and other dissemination channels, the Guiding Opinions stipulate that such conduct must be severely cracked down upon, so as to effectively foster a social climate conducive to the development of the private sector.
The Guiding Opinions call for strengthening judicial regulation of monopolistic practices by platform enterprises and, in accordance with the law, cracking down on unfair competition such as false advertising and commercial defamation. With regard to malicious “rights protection” activities that infringe upon the legitimate rights and interests of private enterprises and disrupt normal market order, as well as instances of using frivolous or abusive litigation to harm the lawful rights and interests of businesses and entrepreneurs, such conduct must be severely punished in accordance with the law.
In addition, the Guiding Opinions emphasize effectively broadening financing channels for small, medium, and micro private enterprises, regulating—within the bounds of the law—such malpractices in private lending as “front‑end interest” and “high‑interest‑to‑principal” schemes, and reducing the financing costs faced by private offices.

The Guangzhou Maritime Court has released the nation’s first white paper on maritime sand-related adjudication.
Recently, the Guangzhou Maritime Court released the nation’s first white paper on the adjudication of sea‑sand-related cases. The white paper reveals that from 2020 to 2022, the court handled a total of 113 such cases, involving disputes over ship‑charter contracts, port and navigation‑channel dredging projects, and maritime and inland‑water cargo‑transport contracts. These efforts have comprehensively cracked down on illegal sand extraction at sea, strengthened marine ecological protection, and provided robust judicial support and safeguards for building a green and beautiful Guangdong.
The white paper shows that, over the past three years, the Guangzhou Maritime Court has concluded a total of 103 civil cases involving marine sand, with 84 resolved by judgment, 9 settled through mediation, and 10 dismissed either by the parties’ withdrawal or by the court’s dismissal of the suit. The court has fully exercised its adjudicatory functions, standardizing shipping秩序 and providing legal safeguards for the development of the marine economy by reviewing the validity of contracts in accordance with the law and protecting the legitimate rights and interests of ship operators.
The white paper indicates that administrative cases involving marine sand are on the rise year by year. In 2021 and 2022, the Guangzhou Maritime Court handled 12 and 23 non‑litigious administrative review cases related to marine sand, respectively. By establishing a regular communication mechanism with maritime administrative authorities at all levels, the court has cracked down on illegal and criminal activities involving marine sand, safeguarded marine ecological security, and upheld maritime safety and stability.
The white paper also puts forward corresponding measures and recommendations on five key issues—determining the validity of contracts involving marine sand, jurisdiction over administrative cases related to marine sand, remuneration for seafarers employed aboard vessels, review of applications for enforcement of administrative penalties imposed for the illegal extraction and transportation of marine sand, and coordination between maritime courts and maritime administrative law enforcement agencies—and publishes five typical cases involving the adjudication of marine-sand-related matters.

The Supreme People’s Court and the Ministry of Justice have jointly issued guidelines to give full play to the fundamental role of people’s mediation.
On October 12, the Ministry of Justice website published the “Notice on Issuing the ‘Opinions on Fully Leveraging the Fundamental Role of People’s Mediation in Promoting Source-Based Governance of Litigation.’”
The “Opinions” propose strengthening the people’s mediation system as the “first line of defense,” enhancing the identification and prevention of disputes, intensifying efforts to resolve major, difficult, and complex conflicts, and bolstering the coordination between litigation and mediation. People’s courts may, with the consent of both parties, assign cases suitable for resolution through people’s mediation prior to filing or entrust such mediation during litigation. If no mediation agreement is reached, the people’s mediation organization shall promptly complete the procedures for concluding the mediation and return the case file to the people’s court that made the assignment or entrusted the mediation. Upon receipt of the case materials, the people’s court shall promptly register the case for filing or resume proceedings. With respect to facts that are not disputed during the mediation process and are recorded in writing by all parties, in subsequent litigation—except where national interests, public interests, or the legitimate rights and interests of others are involved—no party shall be required to adduce evidence.

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