China's rapid reform and breakneck development over the past 30 years have been a marvel to the world. But, as in all countries, economic development, impressive growth and increased prosperity have created opportunities for corruption. Corruption cases in Beijing have soared in recent years, with the municipality's courts sentencing some 120,000 people for corruption offenses over the past five years alone. In 2006 Shanghai's Communist Party Secretary Chen Liangyu was charged with corruption and received a lengthy sentence. Commercial bribery is also a significant issue. Individuals at all levels of society, including senior government officials, have been tried and convicted in corruption cases.
On November 20, 2008 the Supreme People's Court and the Supreme People's Procuratorate of PRC jointly issued Opinions on Several Issues Concerning the Application of Laws to Commercial Bribery Cases (Opinions), which became effective the same day. The Opinions clarify the various commercial bribery charges that may be brought against individuals and legal entities: the crimes of accepting or offering bribes from or to nonstate employees; accepting or offering bribes; offering bribes by or to an organization; and introducing bribes.
In China, the primary law governing bribery and corruption is the PRC Criminal Law, which distinguishes between bribery involving state officials, or official bribery, and commercial bribery, involving persons not considered state officials. Under the new Opinions, personnel engaged in public matters within commercial state-owned enterprises who are not considered state functionaries are now subject to commercial bribery rules, which are less strict than those regarding official bribery, to which they were previously subject despite not being considered state functionaries. As a result, bribery cases involving these individuals will be handled by a different agency (the National Public Security Bureau rather than the Prosecutor's Office) and will constitute a criminal offense only if the value of the bribe involved reaches a comparatively large amount, which, according to an interpretation of the bureau, is RMB5,000 (approximately US$730). Official bribery is always a criminal offense, regardless of the value involved.
In addition, bribery matters involving these individuals will be subject to the State Administration of Industry and Commerce's Interim Rules on Prohibition of Commercial Bribery, which define both tangible (offers of money or property) and intangible (services and benefits) types of commercial bribery.
The Opinions clarify the types of persons subject to a charge of commercial bribery, including confirming that legal persons (i.e., incorporated entities) can be subject to criminal prosecution.
The Opinions also clarify that the forms of commercial bribery include money, material objects as well as other property-related benefits such as home renovation and the giving of bank cards, credit cards or membership cards having a monetary value, token cards, travel expenses and so forth. The use of the term "other property-related benefits" serves to guide investigators and courts to look beyond the traditional forms of bribery and to note that other benefits could be considered to constitute bribery.
However, the most important aspect of the Opinions is the statement of factors a court should consider when differentiating the fine line between commercial bribery and the presentation of gifts. These include the circumstances by which the property transaction occurred – for example, the relationship between the parties and the amount or value of the property transaction; the amount or value of the property transacted; the cause, time and means by which the property transaction occurred; and whether the accepting party used an official position to facilitate an advantage for the offering party.
The Opinions are a needed addition to China's extensive body of laws and regulations designed to counter bribery and corruption in China and will be welcomed by professional and business fraternities, the courts and, of course, the public at large.