Measures On Trial Implementation Of Poor Credit Records In Foreign-Oriented Investment, Cooperation & Trade

To local commerce administrations, foreign affairs offices, public security bureaus, housing and construction administrations, first-tier customs, taxation administrations, industry and commerce administrations, inspection and quarantine agencies, foreign exchange administrations, China International Contractors Association, and import-export chambers of commerce:

To promote the regular development of foreign investment, cooperation and trade, in the principle of informational publicity, social supervision and responsibility, we hereby promulgate the "Measures On Trial Implementation Of Poor Credit Records In Foreign-Oriented Investment, Cooperation & Trade".

During the course of your implementation of these Measures, please timely notify us of any problems, opinions and suggestions you have.

The Ministry of Commerce of China
The Ministry of Foreign Affairs of China
The Ministry of Public Security of China
The Ministry of Housing and Urban-Rural Development of China
The General Administration of Customs of China
The State Administration of Taxation of China
The State Administration for Industry and Commerce of China
The General Administration of Quality Supervision, Inspection and Quarantine of China
The State Administration of Foreign Exchange of China

July 5, 2013




Article 1 These Measures are formulated in accordance with P. R. China's Law and Regulations on Foreign Trade.

Article 2 The foreign investment and cooperation herein refer to the investment, project contracting, and labor service cooperation conducted at abroad by the enterprises legally registered within China; the foreign trade herein refers to the import and export of goods and technologies and international trade of services.

Article 3 The poor credit records in foreign investment and cooperation refer to collection, edit, dissemination, save and maintenance of the information of law/regulation violation by internal enterprises, organizations and individual persons and external cooperators, project owners, contractors, employers, intermediaries, and individual persons.
The poor credit records in foreign trade refer to collection, edit, dissemination, save and maintenance of the information of law/regulation violation by the legal persons, organizations or individual persons engaging in foreign trade activities.

Article 4 The behaviors under-mentioned shall be listed into the poor credit records in foreign investment and cooperation:

Ⅰ Foreign-Oriented Investment

1. The behaviors of internal enterprises engaging in investment abroad:

(1) Failure to provide expatriate personnel with legal entry-exit formalities, physical examination, vaccination, and external work permit;

(2) Failure to respect local customs and religious beliefs, causing conflicts with local populace;

(3) Incompliance with local standards on production, technology and sanitation, causing safety accidents;

(4) Incompliance with local labor law regulations, causing major labor disputes;

(5) Damage to local ecological environment, and threat to local public security;

(6) Violation of foreign exchange regulations on foreign investment;

(7) Failure to provide expatriate personnel with training on security and law abidance, and failure to take effective precautions against local security risks;

(8) Other violations of local laws and regulations.

2. The behaviors of external cooperators:

(1) Cooperation with internal enterprises by deception means;

(2) Occupation of Chinese enterprise assets abroad by improper means, or infliction of loss on Chinese enterprises abroad;

(3) Other illegal injury to the interests of Chinese enterprises abroad.

Ⅱ Projects Contracting Abroad

1. Internal enterprises, organizations or individual persons arbitrarily conduct foreign projects contracting without relevant operating qualifications.

2. The behaviors of the project contractors from China with operating qualifications:

(1) Violation of labor contracts or laws, triggering major labor disputes with big adverse impacts;

(2) Contracting projects by improper means such as vicious competition and commercial bribe;

(3) By slander or other means, disturbance of other Chinese-invested enterprises, causing them material injury;

(4) Due to their own factors, causing major quality or safety accidents to the projects they contract or operate abroad;

(5) Due to their own factors, serious delay or tardiness in the projects they contract or operate abroad, incurring disputes with big adverse impacts;

(6) Due to their own factors, massive loss in their projects abroad, incurring big adverse impacts;

(7) Arbitral commitment to foreign financing in the name of China's government agencies or financial institutions;

(8) Failure to provide expatriate personnel with training on security and law abidance, and failure to take effective precautions against local security risks;

(9) Other major violation of laws and regulations, lack of business integrity, and bad business operations confirmed by industrial organizations.

Ⅲ Foreign-Oriented Labor Service Cooperation

1. Internal enterprises, organizations or individual persons arbitrarily conduct expatriate labor services without relevant operating qualifications.

2. The behaviors of the enterprises qualified in foreign-oriented labor services:

(1) Illegally entrusting other firms or persons with recruitment of laborers, or accepting affiliation with other firms or persons;

(2) Surcharge on the laborers, and collection of performance security deposit from the laborers;

(3) Failure to provide expatriate laborers with valid external work permit, or dispatching laborers with only tourist visas or business visas;

(4) Failure to enter into contracts with the laborers or failure to perform contracts;

(5) Causing major labor disputes, under administrative penalty, incurring big adverse impacts, or being sentenced by law court to take on legal liability;

(6) Failure to provide the laborers with physical examination and vaccination;

(7) Failure to provide security and law trainings to the laborers;

(8) Other violation of laws and regulations and injury to the interests of the laborers;

3. The behaviors of external employers, organizations and individual persons:

(1) Direct recruitment of laborers within China;

(2) Failure to provide the laborers with proper working and living conditions, physical examinations and vaccinations, and social insurances;

(3) Withholding wages for the laborers;

(4) Vicious breach of contract, causing the laborers to come back in advance;

(5) Violation of contract or law, causing major labor disputes;

(6) Failure to provide prober medical treatment for the laborers who are ill at abroad;

(7) Other violation of law and regulations, and injury to the interests of the laborers.

4. The behaviors of the laborers violating China's or foreign laws and regulations

5. Fraudulence of the enterprises in foreign investment for obtaining state funds

6. Enterprise behaviors that cause big adverse impacts on China-foreign bilateral relationships

Article 5 The following behaviors shall be listed into the poor credit records in foreign trade:

1. Arbitral foreign trade activities by non-registered legal persons, other organizations or individual persons

2. The following behaviors by registered operators of foreign trade:

(1) Obtaining by cheat, counterfeiting or trading the Certificate for Registered Foreign-Trade Operators;

(2) Obtaining by cheat, counterfeiting or trading the Certificate of Origin, import and export licenses, import and export quota certificates, or other certifying documents;

(3) Counterfeiting, trading or illegally using the marks of origin;

(4) Import and export of banned or restricted goods, or other smuggling activities;

(5) Arbitral import and export of the goods under state-run trade;

(6) Tax evasion, fraudulence for export duty refund, tax refusal, falsification in invoices;

(7) Product counterfeiting, infringement on intellectual property rights;

(8) Violation of anti-trust law and regulations;

(9) Unfair competition practices such as lower price, falsification in export invoice, cheat in bidding, misrepresentation in advertising, commercial bribe, etc.

(10) Evasion of legal certification, inspection and quarantine, or being listed into the “import/export food safety warning announcement”;

(11) Fraudulence in contract, arrears in payment, evasion of debt, vicious breach of agreement;

(12) Violation of China's foreign exchange regulations, such as falsification in product prices, trade financing, and foreign exchange deposit;

(13) Falsification and concealment in import and export information;

(14) Illegal declaration for export duty relief or refund;

(15) Vicious competition by low price, major quality and safety accidents, arbitral commitment to foreign financing or insurance in the name of China's government agencies or financial institutions, foreign leak of state secrets, incurring big adverse impacts on China-foreign relationships;

(16) Other violation of law and regulations, and damage to foreign trade order.

Article 6 The collection-dissemination mechanism of the poor credit records herein:

1. With the instructions of local governments, local commerce administrations shall, in cooperation with other administrations, build the collection-dissemination mechanism of the poor credit records in foreign investment, cooperation and trade for local administrative districts; China's embassies and consulates abroad shall build the collection-dissemination mechanism of the poor credit records herein for the countries of their residence.

2. China International Contractors Association and China Electromechanical Import and Export Chamber of Commerce shall build the collection-dissemination mechanism for their member enterprises; various import-export chambers of commerce shall build the collection-dissemination mechanism for their member enterprises, and build importer-exporter credit management system, dynamic disclosing importer-exporter credit ratings.

3. Relevant administrations shall timely disclose enterprises' poor credit records regarding law violations and administrative or legal penalties, and shall supervise the enterprises with poor credit; relevant industrial organizations shall timely disclose the information on enterprise violation of regulations; other information may be for internal reference.

4. Local administrations and China embassies or consulates abroad shall submit the monthly poor credit records to China Ministry of Commerce by each month end. The Ministry of Commerce may release those information over its website for public sharing.

Article 7 The disclosure of the poor credit records herein shall be in accordance with facts, truth, and justice.

Article 8 Where any disclosed information are erroneous or do not tally with facts, the interested parties may raise objection requisition in writing to the disclosing administrations from the date of disclosure. The disclosing administrations shall start a review upon receipt of the objection requisition and shall, if any mistake is proved, make clarification and revoke the disclosed wrong information.

Article 9 These Measures shall enter into force in thirty days from the date of issue, and shall prevail over the Measures on Trial Implementation of Poor Credit Records in Foreign-Oriented Labor Service Cooperation (ShangHeHan [2010] No. 462) if any discrepancy exists between them.