New law or regulation
(1) It was reported on 8 December 2013 that the General Office of the Central Committee of the Communist Party of China (“CPC”) and the General Office of the State Council jointly issued the Provisions on Administration of Domestic Official Reception by Party and Government Organs” (the “Provisions”) to replace a prior regulation governing such matters that was promulgated in 2006. The Provisions further combat corruption and extravagance in connection with official receptions. Among the 26 articles of the Provisions, 15 articles are new, and 7 have been substantially modified compared with the former regulation. The Provisions aim to limit the use of receptions, to simplify reception etiquette, to limit the size of rooms used for receptions, to regulate security guard arrangements, and, generally, to reduce reception costs. The Provisions also contain strict and more detailed requirements and standards on where a business meal may take place and what must be excluded from a business meal.
Local level (Beijing & Shanghai): No developments.
Communist Party Rules: No developments.
Upcoming Law or Regulation
(1) On 6 December 2013, Song Wei (“Song”), the former Legal Representative, Executive Director and General Manager of Chongqing Liangjiang Water Co., Ltd., was reportedly sentenced for taking bribes by the No. 5 Intermediate People’s Court of Chongqing City to 13 years in prison with the confiscation of personal assets valued at RMB 600,000 (USD 98,939), as well as the confiscation of his illegal income totaling RMB 3.903 million (USD 643,600) for taking bribes.
While in office from 2005 to 2012, Song allegedly accepted bribes on 25 occasions from various construction companies totaling RMB 3.903 million (USD 643,600). This money was used by Song in daily consumption and stock investments. In exchange, Song provided various illegal favors in various construction and subcontracting projects to the bribe-givers. Song was given a lighter sentence because he confessed his crimes.
(2) On 11 December 2013, Xiao Yanong (“Xiao”), the former Deputy Commissioner of the Customs in Tianjin was reportedly sentenced for taking bribes and holding a large amount of property from unidentified sources to 16 years in prison by the Intermediate People’s Court of Guigang City, Guangxi Province, with confiscation of personal assets of RMB 1 million (USD 164,899).
During his term in office from 1995 to 2010, Xiao allegedly took advantage of his position to purchase real estate for himself and others at obviously below-market prices and accepted bribes totaling RMB 4.626 million (USD 762,822). Though a civil servant, Xiao possessed RMB 1.204 million (USD 198,538), USD 28,000, HKD 156,000 (USD 33,014) and JPY 330,000 (USD 3,131) from unidentified sources.
(3) On December 18, 2013, Wu Zhizhong (“Wu”), the former Deputy Secretary-general of the People’s Government of Inner Mongolia Autonomous Region was sentenced to life in prison by the Intermediate People’s Court of Hohhot City for embezzlement, bribery, misappropriation of public funds, and holding a large amount of property from unidentified sources.
Reportedly, Wu was accused of taking advantage of his position to embezzle special funds of the Inner Mongolia Department of Finance in an amount more than RMB 10.26 million (USD 1.69 million), accepting bribes with his wife and other close relatives totaling over RMB 5.45 million (USD 898,819), and owning significant amounts of property from unidentified sources aggregating to RMB 20.97 million (USD 3.45 million), HKD 19,757 (USD 2,547), EUR 3,479 (USD 4,779), USD 134,352 and CAD 856 (USD 799). Wu’s wife, Yu Huilong, was sentenced to 9 years in prison for participating in the bribery and embezzlement.
(4) On 20 December 2013, Huang Zhiguang (“Huang”), the former Vice Chairman of the Shenzhen Standing Committee of the Chinese People’s Political Consultative Conference and Party Secretary of Shantou City, was sentenced by the Intermediate People’s Court of Guangzhou City, Guangdong Province to 14 years imprisonment for taking bribes and illegally possessing weapons.
Huang was charged by Guangzhou Municipal People’s Procuratorate for accepting bribes, including jade decorations and Cordyceps sinensis, a valuable Chinese traditional medicine, on 6 occasions, totaling RMB 5.56 million (USD 917,110) and HKD 20,000 (USD 2,579). In return, Huang was found to have taken advantage of his position by seeking illegal interests, such as job promotions for the bribe-givers. Huang was also found guilty of possessing several guns without the proper licenses.
(5) On 20 December 2013, Zhu Fulin (“Zhu”), the former Deputy Mayor of Jinhua City, Zhejiang Province was sentenced to life in prison by the Intermediate People’s Court of Lishui City, Zhejiang Province for taking bribes. Zhu was also deprived of his political rights for life, with confiscation of all his personal assets.
Reportedly, Zhu was convicted of taking bribes from 13 individuals in the form of real estate transactions and investment income, totaling RMB 14.42 million (USD 2.37 million) and EUR 3,000 (USD 4,121). Zhu also accepted a Mazda automobile and three bars of gold while serving as the Chief of the Land Management and Planning Bureau, Party Secretary of Lanxi City, and the Deputy Mayor of Jinhua City from 2000 to 2012. In exchange, Zhu abused his position by providing illegal benefits to the briber-givers in land development, job arrangements, enterprise environmental assessment, etc.
(6) Also on 20 December 2013, Chen Zhubing (“Chen”), the former Head of the Enterprise Department of Ministry of Finance, was sentenced by the No. 1 Intermediate People’s Court of Beijing City to life in prison for taking bribes.
Chen was found guilty of soliciting and accepting bribes amounting to RMB 24.54 million (USD 4.04 million) during his term in office from 2001 to 2011, and of providing illegal benefits in the form of funds and project approvals for various enterprises, abusing his power on nine occasions.
(1) On 11 December 2013, the official website of the Central Commission for Discipline Inspection (“CCDI”) and the Ministry of Supervision (“MOS”) reported certain actions of the government to implement further the reform decisions of the Third Plenary Session of the 18th CPC Central Committee. According to the report, China will develop the standards for the welfare and benefits of governmental officials, including their offices, houses, cars, secretaries, security guards, official receptions, and vacations for the purpose of preventing extravagance and corruption.
(2) It was reported on 25 December 2013 that the CPC Central Committee has issued “2013-2017 Work Plan for the Establishment of a Sound System for Punishing and Preventing Corruption” (the “Plan”), which asserts that China will continue to curb the proliferation of corruption over the next five years. In addition to combating corruption, the Plan also stresses the importance of unremittingly improving the work style of the Party and the transformation of governmental functions to eliminate corruption.
China-related FCPA Action