1. New law or regulation
State level: No developments.
Local level (Beijing & Shanghai):
(1) It was reported on April 27, 2014 that the Shanghai government recently issued the Provisions on Strengthening the Supervision of Vertical Concurrent Position of the Leaders in State Owned Enterprises Directly Managed by Shanghai People’s Government (“Provisions”), which restrict the leaders of state owned enterprises (“SOEs”) from taking leadership positions in affiliated enterprises. Only under certain circumstances may such leaders concurrently hold positions in affiliated enterprises, and in such cases, they cannot hold more than two positions, and neither position is permitted to pay compensation. These Provisions were issued as a result of a survey taken last year that found that over two thirds of leaders in SOEs act as leaders or officers in affiliates.
Communist Party Rules: No developments.
2. Upcoming law or regulation
3. Government Action
(1) It was reported on April 1, 2014 that Gu Junshan, the former Deputy Chief of General Logistics Department of the Chinese People’s Liberation Army (the “PLA”) was prosecuted on March 31, 2014 for embezzlement, taking bribes, misappropriation of public funds, and abuse of power by the PLA Military Procuratorate at the PLA Military Court. No details of the alleged violations were disclosed.
(2) On April 1, 2014, Li Tianfu (“Li”), the former Deputy Director of the Public Security Bureau of Maoming City, Guangdong Province, was sentenced to 16 years in prison by the Higher People’s Court of Guangdong Province in his second trial for taking and offering bribes, with confiscation of personal property amounting to RMB 5.6 million (USD 894,639). Li was sentenced in his first trial to 20 years’ imprisonment in November, 2012.
Li was found guilty of taking bribes during his term in office from 2002 to 2011. Such bribes included RMB 4.12 million (USD 658,198), USD 150,000, HKD 150,000 (USD 19,348), and a vehicle. In return, he sought illegal benefits for the bribe-givers in the form of job promotions, project construction, and administrative enforcement. Li was also charged with offering bribes totaling RMB 200,000 (USD 31,951) and HKD (USD 12,898) to Ni Junxiong, the former Member of the Standing Committee of the Communist Party of China (“CPC”) Maoming Committee, who was sentenced to 15 years in prison in 2012.
(3) The official website of the Central Commission for Discipline Inspection (“CCDI”) of the CPC and the Ministry of Supervision (“MOS”) published a report on April 11, 2014 that Yao Mugen (“Yao”), the former Deputy Governor of Jiangxi Province, had been removed from his position and placed under investigation for severe violation of laws and discipline. Later on April 22, 2014, the CCDI website announced that another provincial-level official, Guo Youming (“Guo”), the former Deputy Governor of Hubei Province, had also been expelled from the Party and will be transferred to judicial authorities for accepting bribes.
(4) On April 14, 2014, CCDI published on its official website that Shen Weichen (“Shen”), the former Secretary and Deputy Chairman of China Association for Science and Technology, was under investigation by the Party for suspected serious violation of discipline and law. Shen is the first ministerial-level official to be placed under investigation this year.
(5) On April 28, Ren Lianjun (“Ren”), the former Deputy Chairman of Chinese People’s Political Consultative Conference (“CPPCC”) in Zhoukou city, Henan Province, was sentenced to death with a two-year reprieve by the Intermediate People’s Court of Pingdingshan City, Henan Province with deprivation of political rights for life and confiscation of all his personal property for embezzlement and taking bribery.
Ren allegedly took advantage of his position from 2003 to May 2012, embezzling public funds amounting to RMB 12.29 million (USD 1.96 million), which were documented as debt repayment, office expenses, and the purchase of calligraphy and paintings. Ren was also found guilty of accepting bribes including cash, bank cards, an apartment, and watches totaling RMB 22.93 million (USD 3.66 million) over more than 500 separate occasions, including New Year’s Day and other festivals, as well as on the occasion of job promotions, marriages and funerals of relatives, constructions projects, etc.
It was reported on April 28, 2014 that the “Weekly Briefing” column of the official website of CCDI and MOS had reported during the prior four weeks 719 cases of violations of the eight-point code issued by the central government to cut bureaucracy and maintain close ties with the public. This column was opened to reveal cases involving violations of disciplinary rules and to encourage the public to provide clues and offer comments on such cases.
5. China-related FCPA Action