7. Circular by the General Office of the CPC Central Committee and the General Office of the State Council on Cessation of New Construction of Buildings, Halls and Chambers and Clearing Up Housing for Office Use of Party and Governmental Offices
Promulgated on July 23, 2013 by the General Office of the CPC Central Committee and the General Office of the State Council, the Circular on Cessation of New Construction of Buildings, Halls and Chambers and Clearing Up Housing for Office Use of Party and Governmental Offices was created in order to ensure the cessation in every aspect of the new construction of buildings, halls and chambers, and to regulate the management of housing for office use.
The Circular emphasizes the following, which are to completely cease in full: all aspects of the construction of new buildings, halls, and chambers for party and government offices; strict supervision in regard to the maintenance and transformation of housing for office house; to clear up in full aspects related to office occupancy for party and governmental offices; to strictly regulate housing management for party and governmental offices; and to strengthen the leadership’s supervision and administration of such.
The Circular further indicates that party and governmental offices at all levels shall not construct any new buildings, halls or chambers in any form or for any reason within five years, commencing from the promulgation date of the Circular. Any forms of new construction, extensions, moves, and the building of new construction projects, or the purchase, sponsorship or donation of any new construction shall be strictly prohibited.
8. Circular on Temporary Exemption of Value-added Tax and Business Taxes of Some Small and Micro Enterprises
Promulgated on July 29, 2013 by State Administration of Taxation and Ministry of Finance, the Circular on Temporary Exemption of Value-added Tax and Business Taxes of Some Small and Micro Enterprises formally stipulates a temporary exemption from value-added tax and business taxes of some small and micro enterprises.
The circular expressly indicates that in order to further support the development of small and micro enterprises, with the approval of the State Council, from August 1, 2013, for the enterprises or non-enterprise entities belonging to small-scale taxpayers of value-added tax (VAT) with monthly sales not more than CNY 20,000, VAT shall be temporarily exempted; and for the enterprises or non-enterprise entities belonging to small-scale taxpayers of business tax with a monthly turnover of not more than CNY20,000, business taxes shall be temporarily exempted.
9. Announcement on the Scope of Hong Kong or Macau-Related Civil Cases Permitting the Representation of Hong Kong or Macau Residents Possessing Mainland China’s Legal Profession Qualifications and Mainland China’s Lawyer License in the People’s Courts in Mainland China
The Announcement on the Scope of Hong Kong or Macau-Related Civil Cases Permitting the Representation of Hong Kong or Macau Residents Possessing Mainland China’s Legal Profession Qualifications and Mainland China’s Lawyer License in the People’s Courts in Mainland China was promulgated on August 15, 2013 by the Ministry of Justice.
With a view to implementing the provisions on “the research on expanding the business scope of civil litigation representation involving residents or legal persons from Hong Kong or Macau by Hong Kong or Macau residents possessing Mainland China’s legal profession qualifications and Mainland China’s lawyer license” as set forth in Supplementary Agreement VIII of the Closer Economic Partnership Agreement between the Mainland and Hong Kong and Macao, signed by and between the central government of the PRC and the Hong Kong and Macau Special Administrative Regions respectively, the scope of Hong Kong or Macau-related civil cases permitting representation by Hong Kong or Macau residents possessing Mainland China’s legal profession qualifications and Mainland China’s lawyer license shall include 237 causes of action, covering contractual disputes, as well as cases involving intellectual property, corporate law, securities, insurance and negotiable instruments, etc.
(Official Website of Ministry of Justice: http://www.moj.gov.cn/index/content/2013-08/15/content_4769241.htm?node=7346)
10. The Standing Committee of the National People’s Congress Promulgated the Trademark Law of the People’s Republic of China (Revised in 2013)
On August 30, 2013, the Standing Committee of the National People’s Congress promulgated the Decisions of the Standing Committee of the National People’s Congress Concerning Alterations to the Trademark Law of the People’s Republic of China, which shall be implemented on May 1, 2014.
The most current revisions to the Trademark Law encompass several purposes; first, to further convenience of registration by the applicant, maintaining the market order for fair competition, and strengthening the protection of exclusive trademark rights. The newly revised Trademark Law includes the following highlights: (1) new forms of trademark, such as the “sound trademark”; (2) newly added procedures involving “application of one trademark for multiple categories”, which allows a trademark applicant to apply the same trademark in different categories by submitting only one application; and online records of trademark applications, which are available to the general public. The aforementioned revisions will simplify the application procedures and shorten the time required for the registration of a trademark; (3) clarification of the time limit for application and examination procedures, and the time for extension of a trademark right shall now start from one year before the expiration date, compared with a half year before the expiration date as stipulated in the old law; and a nine-month period for completing the examination of a trademark or the reexamination or rejection of a trademark registration by the Trademark Review and Adjudication Board. For invalidity of a trademark, a three-month extension is allowed under special circumstances; the time for completing the reexamination by the opposition shall be 12 months, with another 6-month grace period under certain special circumstances; (4) further strengthening the protection of the exclusive trademark right; to that end, the newly revised Trademark Law imposes a fine up to five times of illicit revenue compared with three times the revenue as stipulated in the old law. The amount of compensation for infringing the exclusive right to use a trademark may be one time to three times the right owner’s actual losses due to infringement or the infringer’s actual interests obtained due to the same, compared with the same amount of aforesaid losses and interests as stipulated in the old law. The highest amount for statutory damages shall be three million CNY compared with five hundred thousand CNY damages as stipulated in old law; (5) newly added obligatory rules for trademark agencies; the revised Trademark Law indicates that a trademark agency shall have a statutory obligation to confidentiality, and shall explicitly notify a client when a trademark is forbidden by the law. In addition, a trademark agency shall not represent a rushed trademark application and shall be forbidden from applying for a trademark registration beyond the scope of its authorization. The newly revised Trademark Law further stipulates that if a trademark agency commits some illegal conduct, the administrative department for industry and commerce shall order the agency organization to rectify the same within a specified time and give a corresponding warning, as well as impose a fine; in the case of serious circumstances, the Trademark Office and the Trademark Review and Adjudication Board may cease accepting the agency’s business and make relevant announcement to the same effect.
(Official Website of the Trademark Office by General Administration for Industry and Commerce: http://sbj.saic.gov.cn/flfg1/flfg/201309/t20130903_137807.html)
11. The Standing Committee of the National People’s Congress Promulgated a Decision on Authorizing the State Council to Temporarily Adjust the Administrative Examination and Approval of Relevant Laws in China (Shanghai) Free Trade Zone
On August 30, 2013, the fourth session of the Standing Committee of the 12th National People’s Congress decided to authorize the State Council to, to the extent of China (Shanghai) Free Trade Zone, covering the Shanghai Waigaoqiao Free Trade Zone, Shanghai Waigaoqiao Bonded Logistics Park, Yangshan Free Trade Port Area and Shanghai Pudong Airport Comprehensive Free Trade Zone, temporarily adjust the administrative examination and approval (a catalogue is attached hereto) prescribed in the Law of the People’s Republic of China on Wholly Foreign-Invested Enterprises, the Law of the People’s Republic of China on Sino-foreign Equity Joint Ventures and the Law of the People’s Republic of China on Sino-foreign Cooperative Joint Ventures with respect to foreign investment out of the scope of special administrative measures for admittance according to national regulations. The aforesaid adjustment of administrative examination and approval will be put into trial implementation for a period of three years. For those proven feasible in practice, relevant laws shall be amended and perfected; and for those proven inappropriate in practice, the implementation of relevant laws in existence shall be resumed.
More than 11 items, which were required by the laws and regulations to be submitted to a procedure for examination and approval, are as follows now temporarily adjusted into a requirement for filing instead: the establishment, examination and approval of foreign-invested enterprises; the examination and approval for division, merging and any other material changes in a foreign-invested enterprise; the operating period of a foreign invested enterprise; the establishment, examination and approval of a Sino-foreign equity joint venture; extension of the contract term of a joint venture; examination and approval for dissolution of a Sino-foreign equity joint venture; examination and approval for establishment of a Sino-foreign cooperative joint venture; examination and approval for material changes of agreements, contracts and articles of association of Sino-foreign cooperative joint ventures; examination and approval for transfer of contract rights and obligations of Sino-foreign cooperative joint ventures; examination and approval for entrustment others to manage and operate a Sino-foreign cooperative joint venture; and the examination and approval for extension of the cooperative term of a Sino-foreign cooperative joint venture.
(Published with Authorization by XinhuaNet:http://news.xinhuanet.com/2013-08/30/c_117167045.htm)
12. The Supreme People’s Court Publicized the Provisions on Several Issues Concerning the Application of the Enterprise Bankruptcy Law of the People’s Republic of China (II)
On September 5, 2013, the Supreme People’s Court publicized its Provisions on Several Issues Concerning the Application of the Enterprise Bankruptcy Law of the People’s Republic of China (II), which was implemented on September 16, 2013.
The following contents are clarified in the Provisions of Several Issues Concerning the Application of the Enterprise Bankruptcy Law of the People’s Republic of China (II):
(1) Definition of property by the debtor, the right of revocation, right of recall, right of set-off, preservation and performance of the property by the debtor, and other litigations derived from the property by the debtor;
(2) To clarify special problems arising from exercising the right of revocation of bankruptcy, such as the starting point for revocable acts where a debtor goes from administrative liquidation to bankruptcy procedure, and the exceptional circumstances for a debtor’s liquidation of undue debts and a debtor’s individual liquidation of any creditor’s rights, etc.
(3) Where a relevant receiver does not file an action in accordance with the PRC Enterprise Bankruptcy Law, the creditor can file an action in accordance with the provisions of the PRC Company Law and claim the right of revocation, while the property gained from the suit shall belong to the bankruptcy assets.
(4) Statute of limitations of a debtor’s external creditor’s right;
(5) Actions filed by a creditor against the debtor after the acceptance of a bankruptcy petition by a People’s Court;
(6) Specific application of different recall rights during bankruptcy procedures, which include a non-debtor’s recall right for his property, compensatory recall rights, a seller’s recall rights with regard to the goods in transit against the receiver and a seller’s recall right, which covers recall rights under the PRC Bankruptcy Law and other laws.
(7) After the acceptance of a bankruptcy petition by the People’s Court, the recall right of the other’s property possessed by the debtor, the recall right of property owner and the acquisition of ownership or other title of the subject matter based on good faith under such circumstances.
(Official Website of the Supreme People’s Court：http://www.court.gov.cn/qwfb/sfjs/201309/t20130913_187999.htm)
13. The State Administration of Taxation Promulgated the Administrative Measures for Value-added Tax Exemption for Cross-border Taxable Services in the Collection of Value-added Tax in Lieu of Business Tax (for Trial Implementation)
On September 13, 2013, in order to standardize the tax administration of cross-border taxable services, the State Administration of Taxation, in accordance with relevant provisions on value-added taxes currently in force, formulated and promulgated the Administrative Measures for Value-added Tax Exemption for Cross-border Taxable Services in the Collection of Value-added Tax in Lieu of Business Tax (for Trial Implementation), which was implemented on August 1, 2013.
The Measures firstly clarify the scope of cross-border services which will be exempted from value-added tax, including nine categories of services, such as conference and exhibition services for conferences and exhibitions located outside the territory; tangible personal property leasing services for subject matter used outside the territory; warehousing services with storage locations outside the territory, etc. Among them, international transport services applying simple tax methods, transport services to and from Hong Kong, Macao and Taiwan and transport services provided in Hong Kong, Macao and Taiwan; R&D and technical services (excluding R&D services and engineering survey and exploration services), information technology services, culture creativity services (excluding design services, advertising services, and conference and exhibition services), logistics supporting services (excluding warehousing services) provided to foreign entities, and advertising services provided to foreign entities for advertising in locations outside the territory, shall all be within the scope of cross-border services exempted from the value-added tax.
Where taxpayers who provide cross-border services apply for a tax exemption, they shall handle tax exemption filing formalities for cross-border services with the competent tax authorities, and in addition within a timely manner submit the Tax Exemption Filing Form for Cross-border Taxable Services, including both original and a copy of the cross-border service contract, as well as other relevant certifying materials. Where the taxpayers who provide cross-border services fail to handle the tax exemption filing formalities for cross-border services as required, no value-added tax shall be exempted.
Furthermore, before the implementation date of the Measures, where the taxpayers who provided cross-border services in conformity with Article 2 hereof had made a tax exemption declaration previously, they shall complete the filing formalities according to the Measures; where taxpayers failed to make a tax exemption declaration, they may apply for a tax refund or deduction of future tax amounts payable after completing the cross-border service filing formalities according to the Measures; where value-added tax special invoices were issued, taxpayers may handle the tax exemption filing formalities for cross-border services only after each copy thereof is returned; where cross-border services provided by taxpayers are inconsistent with Article 2 of the Measures, value-added tax shall be duly collected according to the law.
(Official Website of State Administration for Taxation: http://www.chinatax.gov.cn/n8136506/n8136593/n8137537/n8138502/12379541.html)
14. The Supreme People’s Court and the Supreme People’s Procuratorate Promulgated its Interpretation on Certain Issues Concerning the Application of Law to the Handling of Defamation via Information Networks and Other Criminal Cases
On September 6, 2013, the Supreme People’s Court and the Supreme People’s Procuratorate promulgated its Interpretation on Certain Issues Concerning the Application of Law to the Handling of Defamation via Information Networks and Other Criminal Cases, which was implemented on September 10, 2013.
The Interpretation mainly defines a clear standard of the circumstances and scenarios under which certain crimes, including defamation, affray, illegal operations and other crimes in the context of information networks may occur.
Among them, the following situations shall be identified as the aggravated circumstances of defamation: (1) a piece of the same defamation information having been clicked and browsed over 5,000 times or having been forwarded over 500 times; (2) causing victims or close relatives thereof to be insane, or causing them to commit self-harm, suicide, or any other serious consequences; (3) having suffered administrative punishment due to defamation within a period of two years, and defaming other persons again; and (4) other serious circumstances. In addition, the person defaming other people via information networks multiple times within a one-year period, who continually fails to deal appropriately with such behavior, will find such behavior constitutes a crime according to the total amount of actual clicking by browsers, including simple browsing as well as forwarding of such defaming information. Those guilty of these acts shall be convicted and punished according to the law.
For affray, the person seriously abusing and threatening other persons and destroying the social order via information networks shall be convicted of affray and punished in accordance with Item (2), Paragraph 1 of Article 293 of the PRC Criminal Law.
A person creating false information, or having known false information, then subsequently spreading or organizing and instigating others to spread false information on information networks with the purpose to create disturbances, which then result in serious public disorder, shall be convicted of affray and punished in accordance with Item (4), Paragraph 1 of Article 293 of the PRC Criminal Law.
(The Official Website of the Supreme People’s Court: http://www.court.gov.cn/qwfb/sfjs/201309/t20130913_187998.htm)
15. The Ministry of Transport Promulgated its Decision on the Revisions of the Implementing Rules of the Regulations of the People’s Republic of China on International Maritime Transportation
The Ministry of Transport promulgated its Decision on the Revisions of the Implementing Rules of the Regulations of the People’s Republic of China on International Maritime Transportation on August 29, 2013, which was implemented on the said promulgation date.
The major revisions are set forth as follows; (1) Revision of the qualifications of operating international shipping agency services; for the enterprises established inside the territory of China operating international shipping agency services, or Chinese business entities operating international shipping agency services, shall have a fixed place of business and the necessary business facilities, having at least two of the senior business management personnel in such enterprises or business entities having more than three years’ experience in operating a business involved in international sea transport. The enterprise engaging in international shipping agency businesses shall record and preserve documentary evidence of its place of business, as well as supporting documents for relevant personnel’s qualifications, and subsequently file such with the Ministry of Transport within thirty days after its establishment; (2) For international shipping agency services invested by foreign investment, such an enterprise intending to be established shall submit its application materials in accordance with regulations to the Ministry of Transport through the competent transport department of the People’s government of the province or municipality where the enterprise is located. The relevant transport department of the People’s government of the province or municipality shall, within ten business days after receiving complete materials mentioned above, transfer and report the relevant materials and its opinions regarding the submitted materials to the Ministry of Transport. The Ministry of Transport shall, within thirty business days after receiving the above materials and opinions, examine the same according to the provisions of Article 7 (1) of the Implementing Rules, and make decisions of approval or disapproval. If approval is granted, the Ministry of Transport shall issue an approval certificate; in the event an application is not approved, the Ministry of Transport shall notify the applicant in writing and provide reasons leading to its decision not to approve the application.
In addition, the revisions also delete provisions regarding the Ministry of Transport’s examination and approval requirement of agreements of acquisition or mergers in cases where acquisitions or mergers occur between Chinese international shipping service operators or between Chinese international shipping operators and foreign international shipping operators. Finally, relevant provisions regarding the resident representative offices of foreign enterprises were also deleted in the current revision.
(Website of the Ministry of Transport: http://mot.gov.cn/zfxxgk/bnssj/syj/201309/t20130913_1482606.html)