1. New law or regulation
State level: No developments.
Local level (Beijing & Shanghai): No developments.
Communist Party Rules: No developments.
2. Upcoming law or regulation
3. Government Action
(1) The official website of the Central Commission for Discipline Inspection (“CCDI”) of the Communist Party of China (“CPC”) and the Ministry of Supervision (“MOS”) published a report on June 3, 2014, that provides that Zhao Zhiyong (“Zhao”), the former Member of the Standing Committee of CPC Jiangxi Provincial Committee, has been removed from his position for suspected violations of law and discipline. Zhao was the third official at the vice-ministerial level in Jiangxi Province who has been investigated for suspected violation of Party discipline. More details are expected to emerge over the coming months.
(2) On June 5, 2014, the Beijing Higher People’s Court at a second trial affirmed the ruling in the bribery case of Chen Zhubing (“Chen”), the former Director of the Comprehensive Division of Enterprise Department of the Ministry of Finance. At the first trial, Chen was given a life sentence plus confiscation of all personal property for taking bribes.
Together with other individuals, Chen was found guilty of taking and soliciting bribes amounting to RMB 24.544 million (USD 3.95 million) on nine occasions during his term in office from 2001 to 2011. In return, Chen abused his position by seeking illegal benefits for bribe-givers in the form of subsidized loans, special subsidies, and loan approvals for construction projects.
(3) It was reported on June 18, 2014, that Xue Huafeng (“Xue”), the former Chief and Secretary of Xi’an Housing Fund Management Centre, was sentenced to 11 years’ imprisonment by Shanxi Higher People’s Court in his second trial.
Xue was accused of accepting bribes exceeding RMB 1.98 million (USD 318,974) during his term from 2008 to 2012 from the legal representative of a real estate company and senior management personnel of two banks respectively. In exchange, Xue helped the bribe-givers to obtain illegal benefits with respect to real estate developments and bank loans. Xue was sentenced to 11 years in prison in his first trial on November 16, 2013, by the Intermediate People’s Court of Xianyang City, and this judgment was affirmed by Shanxi Higher People’s Court when Xue appealed.
(4) On June 9, 2014, Xu Minjie (“Xu”), the former deputy general manager of China’s state-owned shipping giant China Ocean Shipping Group Co., Ltd. (“COSCO”), was expelled from the Party.
Xu reportedly resigned his post as deputy general manager in November last year for “personal reasons” and then was placed under investigation. Xu was allegedly found guilty of falsely claiming personal expenses from COSCO, including his wife’s beauty salon expenses, thereby abusing his position. The CCDI did not specify how much money Xu fraudulently claimed as expenses. The case has been transferred to the judicial authority.
(5) On June 30, 2014, Xu Caihou (“Xu”), the former Vice President of China’s Military Commission, was expelled from the Party on corruption charges. This decision was made at a conference of the CPC Politburo held by President Xi Jinping. Reportedly, Xu has been under investigation since March 15 and was found to have received bribes, both personally and through family members.
According to Xinhua News Agency, the most prestigious national news agency in China, nearly 30 officials at the provincial government level have been investigated on corruption charges since November, 2012, due to China’s efforts to combat corruption in the government.
On June 20, 2014, China’s National Audit Office (“NAO”) released a report on 11 state-owned enterprises (“SOEs”) from different industries ranging from oil giants to major power utilities, based on the audits of the financial revenues and expenditures of these SOEs in 2012.
According to the report, these SOEs here found to have violated the rules and regulations on anti-corruption in a number of ways, including the purchase of luxury cars, the payment of improper allowances to employees, and the construction of golf courses, etc. A total of 190 officials at those 11 SOEs have been punished for the breach of the anti-corruption policies. Reportedly, the 11 SOEs have all implemented remedial actions to correct the irregularities discovered by NAO.
5. China-related FCPA Action