China Laws and Regulations Update in May 2020

1.The Civil Codeof the People’s Republic of China

Promulgated by the National People’s Congress

Promulgation date: 28 May 2020

Implementation date: 1 January 2021

Document number: No.45 President Order

The Civil Code of the People’s Republic of China consists of 1260 items in seven chapters, i.e. general principles, rights in property, contracts, personality rights, marriage and family, inheritance, infringement and attached sections.

The lawmaking committee of the Standing Committee of the National People’s Congress started to work on the Civil Code in March 2015. The general principles of the civil law were reviewed and passed on the 5th meeting of the 12th National People’s Congress in March 2017. In December 2019 the Standing Committee of the National People’s Congress reviewed the draft of the Civil Code incorporating the general principles of the civil law and drafts of the chapters of the amended Civil Code and decided to submit the draft of the Civil Code to the 3rd meeting of the 13th National People’s Congress for review.

During the two sessions this year delegates reviewed and discussed the draft of the Civil Code actively. More than 100 changes, including 40 substantive changes were made.

In the Civil Code the public should be well informed of repair and maintenance funds for and use of buildings and attached facilities and real property service providers cannot cut off electric, water, heating or gas supply to people who delay paying service fees.

Civil Code further improves anti-harassment rules by including “words and pictures” in forms of sex harassment and falling object related rules by requiring the public security and other authorities investigate and ascertain responsible person(s) in a legal and prompt manner when an object thrown out of or falling from a building causes damage to other person.

Regarding injuries caused by sinking ground, Civil Code requires construction and builder units be severally and jointly liable for damage to other person caused by a building, a structure or other facility that is or has been collapsing or sinking, in addition to infringement arising from a collapsing or sinking incident caused by other person.

Civil Code will take effect and the current marriage, inheritance, adoption, warranty, contract, property and infringement laws and the uniform and general principles of the civil law will be abolished at the same time on 1 January 2021. (Source: Website of the National People’s Congress)  

2.Opinions (II) on Legally and Appropriately Dealing with Issues Pertaining Enforcement Actions forConvid-19 Related Cases

Promulgated by the Supreme People’s Court

Document number: F.F.[2020] No.17

Promulgation date: 19 May 2020

Opinions (II) are given mainly from four aspects. First, the main parts of “six stability maintenance tasks” are “six support” services. Action will be taken to save businesses from debt crises through reorganization and settlement in the bankruptcy stage and stricter implementation of the non-abusive enforcement principle in order to support entities in the market. Second, sale and purchase contract action cases will be legally decided to support business and supply chains. Third, education and training contract and medical insurance contract cases will be legally decided to meet needs of the general public. Fourth, government policies for businesses and ordinary people during Convid-19 crisis will be taken into action to support economic and social development. (Source: Website of the Supreme People’s Court)

3.Notice on Making Progress in the Work on Fair Competition Examinations

Promulgated by four authorities, including the State Administration for Market Regulation

Promulgation date: 12 May 2020

Document number: SAMR.AM.[2020] No.73

Notice emphasizes the examination scope. All rules, specifications, policies and “matter-by-matter discussion” policy related measures relating to market entry restrictions, business development, business opportunity and investor solicitation, tender and bidding, government procurement, code of conduct for doing business, qualifications, etc. connected with economic activities of entities in the market are included in the scope of fair competition examination.

Examination criteria are further clarified. To further improve and clarify fair competition examination criteria, obstacles for persons to withdraw from the market on equal terms, transactions done in an indirect way that pays bonuses or subsidies and practices of protecting local industries, effect on fair use of production materials, discrimination in supervision and regulation and other events that entities in the market strongly oppose to are included in the examination criteria.

Notice requires improvement of examination approaches. On the basis of strict implementation of the principle that “the person who makes the examination rules performs the examination”, internal authorities in certain areas can perform uniform examination or preliminary examination which will be followed by reexamination by the authority concerned. (Source: Website of the State Administration for Market Regulation)

4.Opinions on Legally and Appropriately Dealing with Issues Pertaining Enforcement Actions forConvid-19 Related Cases

Promulgated by the Supreme People’s Court

Promulgation date: 13 May 2020

Document number: F.F.[2020] No.16

Opinions requires accurate interpretations of legal restrictions on involuntary closure measures. Excessive and unnecessary closures are banned to avoid illegal and unnecessary enforcement that may affect property uses and business running.

Opinions emphasizes punishment and warnings for dishonest actions to a small number of people behaving illegally and dishonestly such as avoiding or refusing to comply with enforcement measures in order to create an atmosphere of “complying with contracts and behaving honestly” in the market and legal areas.

Opinions notes that information technology should be fully used to take enforcement actions. Completed parts of the “intelligent court”, especially enforcement information systems should be fully used to supervise and manage entities of lower ranks more strictly and prevent passive, delayed and unnecessary enforcement during Convid-19.

Opinions notes legal auctions can be performed online in an appropriate manner and a good order. Online auctions are less expensive, more efficient, not very likely to be affected by the pandemic and able to sell property for money to be paid to winning parties more quickly.. (Source: Website of the Supreme People’s Court)

5.Opinions of the Ministry of Justice on Improving Regulations of Legal Appraisers Giving Testimonies in Courts

Document number: S.G.[2020] No.2

Promulgation date: 27 May 2020

Promulgated by the Ministry of Justice                                

Opinions states that legal appraisers giving testimonies in courts mean legal authority approved and registered and legally licensed appraisers with a legal notice from the court explaining appraisal basis, process, methods, reliability and other aspects of appraiser opinions they have given and answering and asking questions in the court.

Opinions requires the appraiser(s) designated by the court issuing a notice or if the court doesn’t designate any appraiser, one or more of appraisers who signed on legal appraisal opinions designated by the appraisal institution give testimonies in the court. Legal appraisal institutions should provide appraisers with essentials for appearing in court.

Opinions states that appraisers should cooperate with courts in examining evidence, answer questions about appraisal honestly, take care of necessary appraisal materials, samples and archives, tell the court if any questions they are asked relate to state or trade secrets or private information known in their professional activities and answer these questions honestly if the court allows them to do so. (Source: Website of the Ministry of Justice)

6.Solid Waste Pollution Prevention and Treatment Law of the People’s Republic of China (Amended)

Promulgated by the Standing Committee of the National People’s Congress

Promulgation date: 6 May 2020

Implementation date: 1 September 2020                                

The amendment is mainly intended to: (a) clarify principles that should be followed to prevent and treat solid waste pollution by decreasing their quantity, turning them into resources and treating them in harmless ways, (b) impose stricter obligations of supervision and administration on governments and relevant departments by establishing target person responsibility, credit information recordation, cooperation, whole-process monitoring, information tracking and other systems to gradually realize the national target of no import of solid wastes, (c) improve the industrial solid waste pollution prevention and treatment policy by imposing stricter obligations on manufacturers and creating emission permit, standing book, comprehensive resource use evaluation and other policies, (d) improve the household garbage pollution prevention and treatment policies by clarifying and implementing the household garbage classification system in our country and establishing household garbage classification principles, (e) improve building garbage, agricultural solid waste and other pollution prevention and treatment policies by establishing classified building garbage treatment and management systems and improving straw, abandoned agricultural film, animal waste and other solid agricultural waste pollution prevention and treatment policies, (f) improve dangerous waste pollution prevention and treatment policies by establishing a level-based and type-based dangerous waste classification system, an information supervision and management system, regional facilities and places for waste disposal, (g) improve the guarantee system by adding the chapter Guaranteed Measures and giving full guarantee to solid waste pollution prevention and treatment by providing land for use, facilities and places, economic and technical policies and measures, professional training and coaching, developments in industrial specialization and scale, technological advances in pollution prevention and treatment, government funding, environment pollution liability insurance, social power, tax reduction policies, etc., (h) impose strict legal obligations by giving severe punishment for offenses, relaxing limits on fines, increasing types of punishment, taking tougher action to ensure punishment is administered to the person who deserves it and adding legal responsibilities for certain offenses. (Source: Website of the Ministry of Justice)


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