Taihe Legal News, Issue 1218

Finance and Capital Markets

FINANCE & CAPITAL MARKETS

The People’s Bank of China has released the Statistical Report on the Direction of Financial Institutions’ Loans for the Second Quarter of 2026.

On July 28, the People’s Bank of China released the Statistical Report on the Allocation of Loans by Financial Institutions for the Second Quarter of 2026.

The report shows that at the end of the second quarter, the outstanding balance of RMB loans totaled 282.63 trillion yuan, up 5.2% year on year, with an increase of 10.72 trillion yuan in the first half of the year. Loans to enterprises and institutions stood at 197.47 trillion yuan, up 8.2% year on year; inclusive small and micro enterprise loans amounted to 38.52 trillion yuan, up 8.3%; green loans reached 48.63 trillion yuan, up 14.5%; and agricultural-related loans totaled 54.16 trillion yuan, up 5.8%. Real estate loans stood at 50.74 trillion yuan, down 4.9% year on year, with development loans and individual housing loans declining by 8.5% and 3.8%, respectively. Loans to technology‑focused SMEs totaled 4.15 trillion yuan, while loans to high‑tech enterprises reached 21.53 trillion yuan, up 20.1% and 14.6%, respectively.

The National Administration of Financial Regulation has outlined key priorities for Party building and financial regulation in the second half of the year.

On July 27, the National Administration of Financial Regulation convened a conference on Party building within the system and its mid-year work meeting for 2026.

The meeting outlined key priorities for Party building and regulatory work in the second half of the year, calling for continued strengthening of political development and theoretical education, the refinement of Party‑building mechanisms that align with the “four‑level vertical management” and “four‑responsibility coordination” frameworks, and the enhancement of the political and organizational functions of Party organizations, while advancing efforts to foster a sound work style, enforce discipline, and combat corruption. On the regulatory front, the meeting emphasized coordinated progress in risk prevention, robust oversight, and the promotion of high‑quality development; it also called for steady advancement of reforms to mitigate risks at small and medium‑sized financial institutions, proactive identification and resolution of risks in key areas, and unwavering adherence to the bottom line of preventing systemic financial risks. Furthermore, it reaffirmed a commitment to stringent and effective regulation, upholding the principle that regulation is, by its very nature, supervisory in character, and urged financial institutions to accelerate reform and transformation and pursue differentiated, complementary development. The meeting also laid out plans for workplace safety and for ensuring emergency financial services.

The CPC Central Committee and the State Council have forwarded the Ninth Five-Year Plan for Legal Education and Public Awareness.

Recently, the CPC Central Committee and the State Council forwarded… The Ninth Five-Year Plan (2026–2030) for Promoting Legal Education and Public Awareness, Issued by the Publicity Department of the CPC Central Committee and the Ministry of Justice 。

The Plan specifies that by 2030, the responsibility system—such as the “who enforces the law, who promotes legal awareness” framework—will be further refined, and legal education will be advanced in key areas including the Constitution, the Civil Code, the business environment, the private sector, the digital economy, the platform economy, finance, foreign trade and investment, intellectual property, and cyber governance. It also calls for improving the system of legal study and application among corporate managers and operators, implementing a program to enhance the rule-of-law literacy of private entrepreneurs, strengthening legal publicity and education for platform enterprises and workers in new forms of employment, and promoting lawful and standardized labor practices. In addition, the Plan outlines the development of a nationwide unified information platform for laws, regulations, rules, and normative documents, as well as a “digital‑intelligent legal education” platform, and encourages media outlets and major online platforms to establish public‑interest legal‑education sections.

Business and Corporations

COMMERCIAL & CORPORATE

The Ministry of Finance and the State Taxation Administration have adjusted the urban land use tax policy for the energy and resources sector.

On July 27, 2026, the Ministry of Finance and the State Taxation Administration announced… Announcement on Adjusting the Urban Land Use Tax Policy for Enterprises in Certain Energy and Resource Industries 。

The announcement clarifies that, for land previously eligible for reductions or exemptions under existing regulations, the urban land use tax will be levied at half the rate from September 1, 2026, to August 31, 2027, and at the full rate starting September 1, 2027; the relevant old provisions shall be repealed concurrently. Effective September 1, 2026, certain designated uses of land—such as oil and natural gas production facilities, long-distance oil and gas pipelines, hydropower stations, nuclear power plants, thermal power plants, power supply enterprises, coal enterprises, mining enterprises, and building-materials enterprises—will be exempt from urban land use tax; this exemption also applies to land used during project construction that meets the prescribed criteria. Taxpayers seeking to avail themselves of these tax reductions or exemptions must file the corresponding tax‑exemption declarations and retain documentation pertaining to ownership, approval, planning, and intended use for record‑keeping purposes.

The People’s Bank of China has released the Statistical Report on the Direction of Financial Institutions’ Loans for the Second Quarter of 2026.

On July 28, the People’s Bank of China released the Statistical Report on the Allocation of Loans by Financial Institutions for the Second Quarter of 2026.

The report shows that at the end of the second quarter, the outstanding balance of RMB loans totaled 282.63 trillion yuan, up 5.2% year on year, with an increase of 10.72 trillion yuan in the first half of the year. Loans to enterprises and institutions stood at 197.47 trillion yuan, up 8.2% year on year; inclusive small and micro enterprise loans amounted to 38.52 trillion yuan, up 8.3%; green loans reached 48.63 trillion yuan, up 14.5%; and agricultural-related loans totaled 54.16 trillion yuan, up 5.8%. Real estate loans stood at 50.74 trillion yuan, down 4.9% year on year, with development loans and individual housing loans declining by 8.5% and 3.8%, respectively. Loans to technology‑focused SMEs totaled 4.15 trillion yuan, while loans to high‑tech enterprises reached 21.53 trillion yuan, up 20.1% and 14.6%, respectively.

Beijing is soliciting public comments on the implementation plan for accelerating the development of zero-carbon industrial parks.

The Beijing Municipal Development and Reform Commission has announced the “ Implementation Plan for Accelerating the Development of Zero-Carbon Industrial Parks in Beijing (Draft for Public Comment) 》， public comments are being solicited until August 3, 2026.

The plan aims to establish approximately 20 city‑level zero‑carbon industrial parks by 2030, with tasks structured around five key areas: zero‑carbon energy systems, green and low‑carbon industries, infrastructure upgrades, resource circularity, and digital energy‑carbon management. It also establishes an evaluation framework for two categories of parks: near‑zero‑carbon and zero‑carbon. In principle, applicant parks must be listed in the relevant development zone catalog and meet requirements related to energy consumption, monitoring infrastructure, and safety and environmental protection; the construction period is typically three years. The document specifies core indicators, including carbon emissions per unit of energy consumption and carbon emissions per unit of output value or revenue, while introducing guiding metrics such as the share of non‑fossil energy, the coverage of heating and cooling services, the development of energy‑carbon management platforms, and the penetration rate of carbon‑footprint certification. Additionally, it outlines provisions for financial support, financing instruments, expert advisory services, and procedures for application, review, and acceptance.

Taxation

TAXATION

The World Trade Organization has released the panel report in the dispute case brought by China against Turkey concerning vehicle‑related trade restrictions.

Recently, the World Trade Organization released the Panel Report in the case of China — Measures Affecting Electric Vehicles and Other Vehicles against Turkey (DS629).

An official from the Department of Treaty and Law of the Ministry of Commerce stated that the panel upheld China’s position, ruling that Turkey’s measures concerning electric vehicles, hybrid vehicles, and other related types of vehicles violate WTO rules. According to information disclosed during a press briefing, since 2023, Turkey has imposed restrictive measures—such as additional tariffs and import licensing requirements—on Chinese exports of these vehicles, giving rise to disputes over multilateral trade obligations including bound tariff commitments, national treatment, and most‑favoured‑nation treatment. China welcomed this ruling and urged Turkey to respect the panel’s decision and promptly rectify the challenged measures.

The State Taxation Administration has officially released its first industry-specific cross-border tax guideline, the “Guidance on Tax-Related Services for International Transportation.”

Recently, the State Taxation Administration issued its first industry-specific cross-border tax guidance—the “Guidance on Tax-Related Services for International Transportation”—providing business entities engaged in international maritime, aviation, and land transportation with end-to-end, standardized, and implementable compliance references. This marks another expansion of the “Shuilutong” cross-border tax knowledge product system.

The “Guidance” is divided into two sections—“Attracting Inward Investment” and “Going Global”—and distinguishes among various modes of transport. Centered on the questions of “whether tax should be paid, what taxes are applicable, how much tax is due, and how to remit it,” it systematically organizes relevant tax‑related matters across eight dimensions: taxpayer obligations, withholding obligations, taxable income, tax calculation, tax incentives, treaty benefits, tax administration procedures, and tax‑related risk warnings. In addition, by compiling and interpreting publicly available tax cases, it provides clear, practical guidance on the tax risks associated with cross‑border operations.

Litigation and Arbitration

LITIGATION & ARBITRATION

The Supreme People’s Court has issued a reply addressing disputes over the service period for full-time academic education provided by public institutions.

On July 29, 2026, the Supreme People’s Court announced. Reply of the Supreme People’s Court on Issues Concerning Violations of Service‑Period Agreements by Staff Members of Public Institutions Who Have Taken Leave to Pursue Full‑Time Academic Degrees 。

The Reply clarifies that, where a public institution and an employee have agreed on a service period for full-time academic study undertaken on a leave‑of‑absence basis, the court will not uphold the employee’s claim that such an agreement is invalid solely on the ground that the agreed service period or the liquidated damages clause contravene relevant provisions of the Labor Contract Law. If the employee contends that the service period is unreasonable, the court shall, taking into account factors such as related expenses, the duration of the study, and the attainment of the academic degree, examine whether any portion exceeding a reasonable proportion is invalid. Should the employee breach the agreed service period, the public institution may seek enforcement of contractual liability, which the court shall support in accordance with the law; however, where the liquidated damages are manifestly excessive in relation to the actual losses, the court may, in light of the actual losses, the length of performance already rendered, and the degree of fault, make an appropriate adjustment. The rules under the Labor Contract Law setting a cap on training expenses do not apply to full-time academic education.

The General Office of the State Council has issued the Regulations on the Procedures for Handling Administrative Review Cases of the State Council.

On July 27, the General Office of the State Council announced Notice of the General Office of the State Council on Issuing the “Several Provisions on the Procedures for Handling Administrative Review Cases of the State Council” 。

The “Several Provisions” comprise 10 articles and shall enter into force upon issuance, while simultaneously repealing Document No. 38 [2001] issued by the General Office of the State Council. The document stipulates that applications for administrative reconsideration and applications for administrative reconsideration supervision submitted to the State Council shall be handled in accordance with the law by the State Council’s legal affairs department. It also distinguishes between procedures for upholding, revoking, or amending administrative reconsideration decisions made by provincial- and ministerial-level administrative organs, as well as for reviewing the normative documents and legal bases on which such decisions are based, and clarifies the approval and reporting rules for ordinary matters and for major, sensitive matters. Furthermore, it requires relevant provincial- and ministerial-level administrative organs to respond within the prescribed time limits, submit supporting evidence and grounds, and comply with the relevant legal documents, using the State Council’s official seal for administrative reconsideration when processing all related documents.