Provisional Regulations on Enterprise Information Disclosure (“Regulations”) (企业信息 公示暂行条例), issued by the State Council
As referred to in our Legal Flash of April 2013, the State Council issued the draft Provisions on Information Disclosure by Enterprises on April 17, 2014 (“Draft”). After soliciting public comments, the State Council has officially enacted the Regulations, replacing the annual check system for enterprises (“Enterprises”) with an online public annual report system.
The Regulations introduce slight changes to the Draft. The main highlights in the Regulations are as follows:
- The provincial government will establish the online reporting system for its jurisdiction and coordinate with other relevant authorities to share and manage the information the Enterprises submit.
- The Administration for Industry and Commerce (“AIC”) will publish the status of the companies’ registration and filing, pledge of immoveable assets, pledge of equity, administrative sanctions and other information, within 20 working days from receiving this information during the business transaction.
- Enterprises are obliged to submit their annual reports by June 30 of the following year, and must modify the reported information if there are any mistakes or omissions.
- The annual reports must include the following information:
- Enterprise’s address, postcode, telephone number and email address.
- Corporation status, such as incorporation, existing, suspended or liquidated.
- Investments made by and the share equity of other companies acquired by the Enterprise.
- Capital subscribed by each shareholder, capital disbursed by each shareholder, and capital disbursement timeframe and method (in cash or in kind).
- Shareholding alteration for reasons such as equity transfer by Enterprise’s shareholder. Website name and other information on online business (if any).
- Number of employees.
- Financial statements, such as total assets, total liabilities, total revenues, operating income, total profits, net profits and total taxation.
- Enterprises must report the following events within 20 working days:
- Capital subscribed and disbursed by each shareholder, and capital disbursement timeframe and method (in cash or in kind).
- Shareholding alteration for reasons such as equity transfer by Enterprise’s shareholder.
- Obtaining, modifying or renewing an administrative license.
- Registering pledge of intellectual property rights.
- Administrative sanctions imposed.
- Other relevant information.
- The AIC will set up a public directory of abnormally operated Enterprises that either fail to fulfill the obligations required under the Regulations or submit false information. Enterprises will be removed from this directory if they remedy their breaches within three years.
- The AIC will set up a directory of Enterprises that are serious offenders and have been on the directory of abnormally operated Enterprises for three years. Legal representatives or persons in charge of serious offenders will not be allowed to assume this position in another company. Enterprises will be removed from the directory of serious offenders after they have complied with the Regulations for five years.
Date of issue: August 7, 2014. Date of effectiveness: October 1, 2014.