China Laws and Regulations Update in September 2023

1. Civil Procedure Law of the People’s Republic of China (Amended)

Promulgated by Standing Committee of the National People’s Congress

Promulgation date: 1 September, 2023

Implementation date: 1 January, 2024

Document number: Chinese President Order No. 11

The Decision focuses on amending and improving the part on “Special Provisions on Foreign-related Civil Procedures”. Specifically, it amends the relevant provisions on jurisdiction, expanding the jurisdiction of Chinese courts over foreign-related civil cases; adds the general provisions on parallel proceedings, the principle of forum non conveniens, and other relevant provisions; amends the relevant provisions on service of litigation documents on a party that has no domicile within the territory of the People’s Republic of China; improves the system of judicial assistance in foreign-related civil cases, and adds relevant provisions on the investigation and evidence collection outside the territory of the People’s Republic of China ; and improves the basic rules on the recognition and enforcement of effective judgments and rulings by foreign courts. The Decision also makes corresponding amendments to other parts, such as the addition of a new section on “Cases of Appointment of Estate Administrator” in the original Chapter XV on “Special Procedures”. (Source: National People’s Congress)

http://www.npc.gov.cn/npc/c2/c30834/202309/t20230901_431419.html

2. Law of the People’s Republic of China on Administrative Reconsideration (Amended)

Promulgated by Standing Committee of the National People’s Congress

Promulgation date: 1 September, 2023

Implementation date: 1 January, 2024

Document number: Chinese President Order No. 9

The Amendment consists of 7 chapters and 86 articles, and the main contents of the Amendment include:

(1) Clarifying the principles, responsibilities and safeguards for administrative reconsideration. First, it is clearly stipulated that “administrative reconsideration work shall adhere to the leadership of the Communist Party of China”. Secondly, it improves the provisions on administrative reconsideration organs and institutions, and strengthens the legal responsibility of administrative reconsideration organs to lead administrative reconsideration work. Thirdly, responsibilities of administrative reconsideration is removed from the working departments of local people’s governments to local people’s governments at or above the county level, while the special cases of administrative organs, taxation organs and national security organs under vertical leadership is retained, and the jurisdiction of departments under the State Council is adjusted accordingly. Fourthly, it strengthens capacity construction and work guarantee for administrative reconsideration.

(2) Strengthening the capacity of administrative reconsideration to absorb and resolve administrative disputes. First, it expands the scope of administrative reconsideration, making it clear that those who are not satisfied with administrative agreements, government information disclosure and other acts may apply for administrative reconsideration. Secondly, it expands the circumstance of administrative reconsideration as pre-procedure, making it clear that those who are dissatisfied with the administrative penalty decisions made on the spot in accordance with the law and administrative inaction should first apply for administrative reconsideration. Third, it clarifies the circumstances under which summary procedures are applicable, and stipulates that cases subject to summary procedures shall be concluded within thirty days.

(3) Improving administrative reconsideration acceptance and hearing procedures. First, it clarifies the conditions for the acceptance of administrative reconsideration, adds a system for the correction of application materials, and improves the supervision mechanism for inaction of administrative reconsideration organs. Second, it clarifies that administrative reconsideration organs may conduct mediation in accordance with the principles of legality and voluntariness. Third, it establishes and improves the rules of evidence for administrative reconsideration, and clarifies the burden of proof for the applicant and the respondent. Fourthly, in the general procedures, the principle of handling cases is amended from written review to hearing the opinions of the public in a flexible manner, and a hearing and administrative reconsideration committee system is established for major, difficult and complex cases. Fifth, it improves the procedures and handling methods for the review of normative documents attached to administrative reconsideration.

(4) Strengthening the supervision over administrative law enforcement through administrative reconsideration. First, the system of administrative reconsideration decisions has been improved by refining the circumstances in which decisions such as to change the administrative action and to confirm the illegality of administrative action are applicable, and adding the types of decisions such as to confirm the invalidity of administrative action and to continue performing the administrative agreements. Second, it adds such supervision mechanism as administrative reconsideration opinions, interviews and circulation of a notice of criticism, and delivery of photocopies of administrative reconsideration decisions to the department at a next higher level. (Source: National People’s Congress)

http://www.npc.gov.cn/npc/c2/c30834/202309/t20230901_431409.html

3. Law of the People’s Republic of China on Foreign State Immunity

Promulgated by Standing Committee of the National People’s Congress

Promulgation date: 1 September, 2023

Implementation date: 1 January, 2024

Document number: Chinese President Order No. 10

The Law consists of 23 articles, the main provisions of which are as follows:

First, it establishes the general principle of state immunity. Article 3 of the Law provides that foreign states and their property enjoy immunity from jurisdiction of the courts of the People’s Republic of China, unless otherwise provided by this Law. In other words, in principle, the courts of China do not exercise jurisdiction over foreign states and their property, but the courts of China may exercise jurisdiction in cases that are consistent with the provisions of this Law. At the same time, in accordance with Articles 13 and 14, the property of foreign states enjoys immunity from judicial enforcement measures before the courts of China; except in cases provided by law, the courts of China shall not take judicial enforcement measures against the property of foreign states.

Secondly, it determines the circumstances under which the courts of China may exercise jurisdiction over foreign states and their property. Articles 4 to 12 of the Law make clear provisions on the scope of jurisdiction that the courts of the People’s Republic of China may exercise over foreign states and their property, including the express acceptance of jurisdiction by a foreign state in respect of a particular matter or case, lawsuits arising from the conduct of commercial activities, lawsuits arising from the performance of a labour or service contract, lawsuits and arbitration for damages arising from infringing actions; at the same time, Article 14 makes clear provisions on the circumstances in which the courts of China may take relevant judicial enforcement measures. On the whole, the provisions of the Law concerning the circumstances in which the courts of China may exercise jurisdiction over foreign states and their property are relatively strict and specific, and are generally consistent with the relevant international treaties and prevailing international practice.

Thirdly, it provides for special procedures applicable to cases of foreign state immunity. Taking into account the special characteristics of foreign states as parties to civil cases, Articles 17 and 18 of the Law make specialized provisions on procedures relating to the service of documents and judgments by default in cases of foreign states immunity. With regard to the procedures for the trial and execution of civil cases involving foreign states and their property, where the Law is silent, the provisions of the Civil Procedure Law of the People’s Republic of China and other relevant laws shall apply.

Fourthly, it clarifies that the Ministry of Foreign Affairs plays an important role in foreign state immunity cases. Article 19 of the Law provides that the courts of the People’s Republic of China shall accept as credible the documents issued by the Ministry of Foreign Affairs of the People’s Republic of China on the factual issues of whether or not the state concerned constitutes a foreign sovereign state or whether or not it has served a diplomatic note on a foreign state; at the same time, the Law also provides that the Ministry of Foreign Affairs may issue an opinion to the court on other issues of significant national interest, such as those relating to diplomatic affairs. These provisions are conducive to ensuring and giving full play to the important role of the competent national diplomatic authorities in the adjudication of cases involving foreign states.

Fifthly, it clarifies the relationship between the regime of immunity of foreign states and other relevant regimes of privileges and immunities. Article 20 of the Law provides that the provisions of this Law are without prejudice to the privileges and immunities enjoyed by diplomatic representations, consular posts, special missions, relevant missions and personnel of foreign states, as well as the privileges and immunities enjoyed by heads of state, heads of government, ministers for foreign affairs and other officials of equivalent status in accordance with the laws of China, the international treaties concluded or acceded by China, and international custom. This Article explicitly lists “international custom” as one of the legal basis for the enjoyment of privileges and immunities by the persons concerned, which is the first time that “international custom” has been stipulated in China’s legal system. (Source: National People’s Congress)

http://www.npc.gov.cn/npc/c2/c30834/202309/t20230901_431424.html

4. Measures for the Implementation of the Provisions on the Administration of Enterprise Name Registration

Promulgated by State Administration for Market Regulation

Promulgation date: 29 August, 2023

Implementation date: 1 October, 2023

Document number: SAMR Order No. 82

The main contents of the Measures are as follows: first, optimizing the service of self-declaration of enterprise names; second, regulating the order of enterprise name registration and management; third, strengthening the use of enterprise names and supervision and management; and fourth, perfecting the administrative adjudication mechanism for name disputes. Among them, in order to strictly prevent and stop illegal behaviors such as counterfeiting state-owned enterprises and central enterprises, the Measures strictly prohibit “the use of words related to major national strategic policies, making the public mistakenly believe that the enterprise is associated with national investment, government credit, etc.”, “the submission of false materials or the adoption of other fraudulent means for the self-declaration of enterprise names”, “intentionally declaring enterprise names that are similar to others’ prior names with certain influence in the same industry (including abbreviations, trade names, etc.)”. It is stipulated that if an enterprise name is labeled with words such as “China”, “Zhonghua”, “Central Government”, etc., it will be scrutinized strictly in accordance with the laws and regulations. (Source: State Administration for Market Regulation)

https://www.samr.gov.cn/zw/zfxxgk/fdzdgknr/fgs/art/2023/art_1e269e76abdb405ab5253b7c78e45f6a.html

5. Antimonopoly Compliance Guidelines for Concentrations Between Undertakings

Promulgated by State Administration for Market Regulation

Promulgation date: 11 September, 2023

Document number: SAMR Second Issue [2023] No. 74

The Guidelines is applicable to the antitrust compliance activities of operators when they carry out concentrations between undertakings both within and outside the territory of China. The Guidelines states that strengthening the anti-monopoly compliance management concentrations between undertakings can help operators identify, assess and control the anti-monopoly legal risks of concentrations, avoid concentrations that have or may have the effect of eliminating or restricting competition, and prevent legal liability for the illegal implementation of concentrations. The Guidelines covers the main provisions of the review of concentrations between undertakings, key compliance risks, compliance risk management, and compliance management safeguards. Among them, the Guidelines suggests focusing on six types of concentrations between undertakings such as “a merger with an undertaking with a turnover of more than 400 million yuan in China in the previous fiscal year”, and fully assessing the antitrust legal risks. (Source: State Administration for Market Regulation)

http://www.mohrss.gov.cn/xxgk2020/fdzdgknr/zcfg/gfxwj/ldgx/202308/t20230816_504626.html

6. Interim Measures on Administrative Punishment for Off-School Training and Tutoring

Promulgated by Ministry of Education

Promulgation date: September 11, 2023

Implementation date: October 15, 2023

Document number: ME Order No. 53

The Measures clarifies the implementing authorities and delineates jurisdictional competence, providing that administrative penalties for off-campus training shall be imposed by the department in charge of off-campus training of the government at or above the county level in accordance with the authority to impose administrative penalties under law, and respectively providing for jurisdiction over offline and online off-campus training. Meanwhile, other relevant departments shall investigate and deal with off-campus training violations in accordance with their respective responsibilities. The Measures provides for different violations and corresponding legal responsibilities, including the unauthorized off-campus training institutions, unauthorized academic off-campus tutoring in disguise, unauthorized social competitions, and training activities in violation of laws, administrative regulations and relevant provisions. The Measures also regulates the penalty procedures, focusing on the connection with higher-level laws such as “Administrative Penalty Law of the People’s Republic of China (Revised in 2021)” and based on the actual law enforcement of off-campus training, clarifies criteria for docketing and closing cases, power of investigation, situations of hearing, standards for identifying illegal incomes, etc., and strives to standardize the law enforcement behavior of off-campus training. (Source: Ministry of Education)

http://www.moe.gov.cn/srcsite/A02/s5911/moe_621/202309/t20230912_1079788.html

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