Provisional Regulations on Enterprise Information Publicity

Decree no. 654

of the State Council of the People’s Republic of China

  

The “Provisional Regulations on Enterprise Information Publicity” have been adopted by the 57th Meeting of the Standing Committee of State Council on 23rd July 2014 and are hereby issued, and will go into effect on 1st October 2014

                            Premier Li Keqiang
August 7th, 2014

Provisional Regulations on Enterprise Information Publicity

Article 1. The present Regulations are enacted in order to guarantee fair competition, promote integrity self-regulation by enterprises, standardize information publicity, strengthen enterprise credit restrictions, maintain the security of transactions, improve the efficiency of government supervision, broaden societal supervision.

Article 2. The enterprise information referred to in the present Regulations refers to information produced during the productive and operation activities of enterprises registered by departments for industry and commerce, and to the information produced by government departments while performing their duties, that can reflect the situation of an enterprise.

Article 3. Enterprise public information shall be truthful and timely. Where public information about an enterprise relates to state secret, national security or to the social public interest, it shall be reported for approval by the competent administrative department for secrecy, or by state security institutions.Where information disclosed by the relevant departments of people’s government at the county level or above disclose concerns business secrets or private matters, it shall be reported for approval to the competent department at the next higher level.

Article 4. The governments of provinces, autonomous regions, and municipality directly controlled by the central government lead the work of enterprise information publicity within their administrative jurisdiction. They shall, in accordance with the general requirements of the construction of a social credit system information platform, promote the construction of an enterprise credit information publicity system.

Article 5. The Administration for Industry and Commerce of the State Council promotes, and supervises the work of enterprise information publicity, and organizes the construction of an enterprise information publicity system. Other relevant ministries of the State Council shall perform work relevant to enterprise information publicity in accordance with the present Regulations.

Relevant departments of people’s goverments at the county level or above shall perform the work of enterprise information publicity in accordance with the present Regulations.

Article 6. Administrative departments for industry and commerce shall, through the enterprise credit information publicity system, publicize the following information as it is produced in the course of fulfilling their duties:
(1) information about registration and filing;
(2) information about chattel mortgage registration;
(3) Information about the registration of stock rights;
(4) Information about administrative punishments;
(5) Other information that shall be publicized in accordance with the law.

The enterprise information stipulated in the preceding paragraph shall be publicized within 20 working days from the date when it was produced.

Article 7. Government departments other than departments for industry and commerce (hereinafter referred to as ‘other government departments’) shall publicize the following enterprise information produced while fulfiling their duties:

(1) information about the release, change, and renewal of administrative licences;
(2) information about administrative punishments;
(3) other information that should lawfully be disclosed.

Other government departments may, through the enterprise credit information publicity system, but also through a different system, publicize information stipulated in the preceding paragraph.

Administrative departments for industry and commerce and other government departments shall, in accordance with the general requirements of the construction of a social credit system information platform, realize the interconnection and sharing of enterprise information.

Article 8. Enterprises shall, from 1st January to 30th June every year, submit an annual report to administrative departments for industry and commerce through the enterprise credit information publicity system, and announce it to the public.

Registered enterprise established in a given year shall submit the annual report starting from the next year.

Article 9. Enterprises annual report include:

(1) such information as the business communication address, the postal address, the telephone, and email of an enterprise;
(2) such information as information on the existence of start-ups, shut-downs, and liquidation;
(3) information about enterprise investments to establish enterprises, or to purchase stock;
(4) such information as information about the amount of contributions paid by shareholders or founding members, the date of contribution, and the method of contribution, where the enterprise is a limited liability company, or a company limited by shares;
(5) information about limited liability companies shareholders’ equity transfers;
(6) information such as the internet website of the enterprise, and the name, internet address of the internet service provider;
(7) such information as the number of employees, the total value of assets, the total amount of liabilities, guarantees provided to third parties, the total owner equity, the gross business revenue, the total revenue, the total profit, the net profit, and the total of tax.

Information listed from the first to the sixth point of the preceding paragraph shall be disclosed to the public, while enterprises may chose whether to disclose information listed in the seventh paragraph.

With the enterprise consent, citizens, legal persons or other organizations may inquire about the information an enterprise has chosen not to disclose.

Article 10. An enterprise shall, within 20 working days from the date when it was produced, disclose the following information to the public through the enterprise credit information publicity system:
(1) such information as the amount, time, and method of contribution of shareholders of limited liability companies, or the founder of companies limited by shares;
(2) information about equity transfers by shareholders of limited liability companies;
(3) information about the release, change, and renewal of administrative licences;
(4) information about the registration of intellectual property rights;
(5) information about administrative punishments;
(6) other information items that should lawfully be disclosed.

Where administrative departments for industry and commerce discover that an enterprise has failed to fulfill its disclosure duties in accordance with provisions in the preceding paragraph, they shall issue an order to fulfill such duties within a deadline.

Article 11. Government departments and enterprises shall respectively be responsible for the truthfulness and timeliness of the information they disclose.

Article 12. Where government departments find out that information disclosed by them is not accurate, they shall promptly correct it. Where citizens, legal persons or other organizations have the evidence proving how information disclosed by government departments is not accurate, they have a right to request the said department to to correct the information.

Where an enterprise finds out that the information disclosed is not accurate, it shall promplty correct it. However, the correction of enterprise publicity information in the enterprise annual report shall be completed by 30th June every year. Information before and after correction shall be publicized at the same time.

Article 13. Where citizens, legal persons or other organizations find out information disclosed by an enterprise is false, the may file a report with departments for industry and commerce. The department for industry and commerce that receives the report shall conduct a check and handle the report within 20 working days of the date of its receipt, and it shall produce a written account of its actions to the person who filed the report.

Where citizens, legal persons or other organizations have doubts about the enterprise information that shall be disclosed in accordance with the present Regulations, they may file an inquiry with government departments. The government department that receives the inquiry shall provide a written reply to the inquirer within 20 working days of receipt of the inquiry.

Article 14. The Departments for Industry and Commerce of the State Council, and the people’s governments of provinces, autonomous regions, municipalities directly controlled by the central government shall, in accordance with the demands posed by fair regulation, determine the enterprises to be inspected through the random choice of enterprises registration codes, organize and conduct inspections on the status of enterprise information disclosure.

In performing random inspections on enterprises disclosure, departments for industry and commerce may adopt such methods as documental inspections, on-site inspections, network monitoring.In inspecting information disclosed by enterprises, departments for industry and commerce may delegate an accountancy law firm, a tax law firm, a law firm and other specialized institutions, and to lawfully use the results of other inspections, examinations conducted by government departments, or by other specialized institutions to compile a professional report.

The result of random inspections is announced to the public by government departments through the enterprise credit information publicity system.

Article 15. Departments for industry and commerce conduct random inspection on entrprise credit information in accordance with the law, or conduct inspections according to reports [they have received]. Enterprises shall cooperate and accept inquiries and investigations, provide a truthful account of the situations, and provide relevant materials.

Where an enterprise does not cooperate and the circumstances are serious, departments for industry and commerce shall issue a notice through the enterprise credit information publicity system.

Article 16. Every citizen, legal person or other organization shall not unlawfully alter information disclosed by an enterprise, and shall not unlawfully obtain enterprise information.

Article 17. Where one of the following circumstances exists, it shall be included on the list of business anomalies by departments for industry and commerce, and announced to the public through the enterprise credit information publicity system, to warn [the enterprise] about its duty to fulfill publicity obligations. Where the circumstances are serious, the competent department in charge shall give an administrative punishment in accordance with relevant laws and administrative regulations. Where a damage has been caused to third persons, responsibility to compensate shall be borne in accordance with the law. Where a criminal offense has been committed, criminal responsibility shall be prosecuted in accordance with the law:

(1) the enterprise does not publicize its annual report according to the statutory deadline in the present Regulations, or it does not publicize its annual report according to the deadline that has been set by department for industry and commerce.
(2) enterprise information publicity conceals the real situation, or is fraudulent.

Where an enterprise included on the list of business anomalies fulfill their publicity obligations in accordance with the present Regulations, its name shall be removed from the list of business anomalies from departments for industry and commerce at the county level and above. Where an enterprise has not fulfilled its publicity obligations for three years in accordance with the present Regulations, the State Council Administration for Industry and Commerce, or departments for industry and commerce of provinces, autonomous regions, municipalities directly controlled by the central government shall include its name on the list of enterprises that have committed a serious misconduct, and make an announcement to the public through the enterprise credit information publicity system.The legal representative of enterprises included on the list of enterprises that have committed a serious misconduct, and their responsible persons for 3 years must not be act as legal representatives and responsible persons of another enterprise.

Where five years have elapsed from the day an enterprise was included on the list of enterprises that have committed a serious misconduct and none of the circumstances in the preceding paragraph has occurred, the State Council Administration for Industry and Commerce, or department for industry and commerce of provinces, autonomous regions, municipalities directly controlled by the centre shall remove it from the list of enterprises that have committed a serious misconduct.

Article 18. People’s government at the county level and above and their relevant departments shall establish and complete a credit restraint mechanisms, and enterprise information shall be an important factor to consider in such work as government procurement, bidding on projects, the transfer of state-owned land, the award of honorary titles. [Participation by] enterprises in the list of business anomalies or in the list of enterprises that have committed a serious misconduct shall be limited or prohibited.

Article 19. Where government departments do not fulfill their duties in accordance with the present Regulations, they shall receive a rectification order by supervision institutions, or by government departments at the next higher level. Where circumstances are serious, executive personnel bearing responsibility and other directly responsible personnel shall receive sanctions. Where a criminal offence has been committed, their criminal responsibility shall be prosecuted in accordance with the law.

Article 20. Where enterprise information that has been disclosed is illegally modified, or where enterprise information is illegally obtained, legal responsibility shall be prosecuted in accordance with relevant law, and administrative regulations.

Article 21. Where citizens, legal persons or other organizations believe a concrete administrative action of government departments [performed during] their work of enterprise information publicity to have violated their lawful rights and interests, they may file an application for administrative review in accordance with the law, or file an administrative lawsuit.

Article 22. Disclosure of information by enterprises in accordance with the present regulations does not exempt them from the obligation to disclose information in accordance with other laws, and administrative regulations.

Article 23. The present Regulation’s provisions on government departments disclosure of enterprise information apply to disclosure of enterprise information by organizations authorized by the law and regulations to perform the function of managing public affairs.

Article 24. The State Council Administration for Industry and Commerce is responsible for enacting technical specifications on enterprises credit information publicity.

Concrete measures on credit publicity by Individual commercial and industrial households, and rural professional cooperatives shall be separately formulated by the State Council Administration for Industry and Commerce.

Article 25. The present Regulations shall go into effect from 1st October 2014.

While useful for academic analyses, the English version of the document presented in this post is not legally valid before Chinese courts, and administrative agencies. Readers interested in the official version of this document are encouraged to consult the official website of the State Council, where these Regulations were first posted. This translation is offered ‘as it is’, and for reference only.  All rights on this work belong to the Foundation for Law and International Affairs and to The Coalition for Peace and Ethics. Reproduction of this work is not allowed in any form without prior written consent.  Please consult this Blog’s Terms and Conditions.

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