The most recent FCPA and anticorruption enforcement developments involving the People’s Republic of China (PRC) are summarized below.  Thanks as always to Squire Sanders Shanghai Office for monitoring these enforcement actions.

 Change of Legal Environment

  1. Areas:

            New law or regulation

            Update:

            State level: No developments

            Local level (Beijing & Shanghai): No developments

            Communist Party Rules: No developments

  1. Areas:

            Upcoming law or regulation

            Update:

            None Identified

  1. Areas:

            Government Action

            Update:

  1. On September 18, 2012, Li Bingchun (“Li”), the former Chief of the Liqiao township government in Shunyi District, Beijing City, was sentenced to death with two years’ reprieve by the Second Intermediate People’s Court in Beijing for corruption, taking bribes, and misappropriation of public funds. Such a death sentence with a two-year reprieve is often reduced to life in prison if the convicted person behaves well during the term of imprisonment.  Li was found guilty of receiving more than RMB 38 million (USD 6.03 million) from 2006 to 2007 from a demolition compensation fund that had been established for use in connection with the construction of two highways. He also accepted a bank card giving access to an account containing RMB 80,000 and a gold bar valued at RMB 153,000 (USD 24,280) from two companies whom he helped to win bids and land use rights. In addition, Li was accused of lending more than RMB 178 million (USD 28.25 million) of public funds to several real estate developers between 2006 and 2010. All of his private assets were confiscated.
  2. On September 17 and 18, Wang Lijun (“Wang”), the former Vice Mayor and former Police Chief of Chongqing, was tried in the Intermediate People’s Court in Chengdu, Sichuan Province for attempted defection, abuse of power, bribe-taking, and bending the law for selfish ends. On September 24, Wang was sentenced to 15 years in prison.

Wang was charged with neglecting his duty to investigate and suppress criminal acts and bending the law for personal gain. He also violated relevant laws and regulations by using technical eavesdropping measures against many people on various occasions. Wang purportedly took advantage of his position and illegally accepted money and property worth more than RMB 3.05 million (USD 484,127), in return for securing benefits for other individuals.

  1. On September 21, 2012, Wu Zhiming (“Wu”), the former Deputy Secretary General of Jiangxi Provincial Government, went to trial in the Intermediate People’s Court in Jiujiang City, Jiangxi Province for allegedly taking bribes according to a court statement.

Wu was prosecuted for accepting cash and properties valued at RMB 47.48 million (USD 7.53 million) during his term as Head of Xihu District, Nanchang City, Sectary of Commission of Qingshanhu District, Nanchang City, Mayor Assistant of Nanchang Government and Deputy Secretary General of Jiangxi Provincial Government from 2002 to 2011, and, in return, helping the bribe-givers seek benefits in projects and helping them with job transfers and promotions through the misuse of his post.

  1. On September 23, 2012, Liu Xiquan (“Liu”), the former Deputy Head of Choyang District, Beijing City, was sentenced to 13 years in prison by the First Intermediate People’s Court in Beijing for taking bribes. Liu’s personal assets of RMB 100,000 have been confiscated.

Liu was convicted of involvement in six cases of bribery, receiving in the aggregate RMB 1.85 million (USD 300,000) from 2008 to 2010 by taking advantage of his position as Member of the Standing Committee of the Party Committee and Deputy Head of Choyang District.

  1. On September 25, 2012, Ren Jie (“Ren”), the former Party Secretary and Chairman of Jiangxi Phoenix Optical Instruments Group Corporation and Wang Xiyan (“Wang”), the former Party Secretary and General Manager of Jiangxi Phoenix Optical Instruments Group Corporation, were sentenced to 14 years and 14.5 years in prison respectively by the Intermediate People’s Court in Xinyu City, Jiangxi Province.

Ren was alleged to have received RMB 464,000 (USD 73,637) and USD 80,000 during his term with Phoenix Optical Instruments Group Corporation from 1993 to 2008 in return for helping others to undertake businesses and real estate development and other activities. Wang was accused of accepting bribes totaling RMB 876,940 (USD 139,170) for benefiting others during his time with Phoenix Optical Instruments Group Corporation from 2001 to 2008. Ren and Wang violated relevant laws and regulations by taking advantage of their positions with Phoenix Optical Corporation Ltd. to accept compensation amounts of more than RMB 9 million.

  1. Areas:

            Others

            Update:

 On September 20, the State-owned Assets Supervision and Administration Commission of the State Council (“SASAC”) organized a video training for state- owned enterprises on anti-corruption management. Qiang Weidong, the Member of SASAC CPC Committee and Secretary of the Discipline Inspection Committee, pointed out that SASAC was researching on the standard and method of evaluating the anti-corruption activities and will include democratic meetings, anti-corruption institutional improvement, complainant processing and so on into the scope of the evaluation.