Guiding Opinions on Strengthening and Regulating Efforts on the Management of Lists of Persons Receiving Joint Incentives for Trustworthiness or Joint Punishment for Untrustworthiness

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发改财金规〔2017〕1798号

To each provincial, autonomous region, or directly governed municipality and Xinjiang Production and Construction Corps unit leading the establishment of the social credit system, and member units of the inter-ministerial joint conference on the establishment of social credit:

The following Opinions are hereby released so as to fully implement the Party Central Committee and State Council's series of important decisions and deployments on strengthening the establishment of a social credit system, to thoroughly implement the "State Council Notice on the Release of the Planning Outline for the Establishment of A Social Credit System (2014-2020) (GuoFa (2014) No. 21), the "State Council Guiding Opinions on Establishing and Improving Systems of Joint Incentives for the Trustworthy and Joint Disciplinary Action for the Untrustworthy and Accelerating the Establishment of Social Creditworthiness" (GuoFa (2016) No.33), to establish systems of lists of the targets of joint incentives for the trustworthy and joint disciplinary action for the untrustworthy (hereinafter "redlist" and "blacklist" systems), and to improve joint mechanisms for commending and rewarding those who follow the law and are creditworthy and for punishing those who break the law and are untrustworthy.

I. General Requirements

(1) Guiding Thought. Fully implement the spirit of the 19th Party Congress and thoroughly implement Xi Jinping's though on Social with Chinese Characteristics for a New Era and the Party Central Committee's new concept, new thinking, and new strategy for governance; and follow the decisions and deployments of the Party Central Committee and the State Council to take cultivating and implementing the core socialist values as the core, and establishing and completing systems for the management and application of red and black lists, standardizing designations, rewards, punishments, restoration, and removals for red and black lists in each field; building an overall structure of joint incentives for the trustworthy and joint disciplinary action for the untrustworthy; forcefully and orderly, regulated and transparently, advancing joint rewards and punishments, comprehensively increasing the nation's level of creditworthiness, advancing modernization of the nation's governance system and capacity.

(2) Basic Principles.

- Government leadership with joint implementation by society. Give full play to the functions of state organs, and organizations authorized by laws and regulations to have public affairs management duties, in organizing, guiding, and advancing the management of red and black lists. Encourage the mobilization of social forces' broad participation and joint advancement to form a combined force for joint rewards and punishments.

-- Prudent determinations in accordance with laws and regulations. Research the formulation of unified standards for making for red and black list designations in each field, following the principle of 'persons making designations bearing responsibility' and prudently make red and black list designations in accordance with law and based on the creditworthiness of the relevant entities conduct and the need to take joint reward and punishment measures.

-- Classification by type and level, with differentiated treatment. Carry out different types and different degrees of joint reward and penalty measures, based on the creditworthiness of the relevant entities. Untrustworthy entities that have not yet reached the standard for 'blacklisting' designations, may be entered into the list of targets for key credit status scrutiny (hereinafter simply the "key scrutiny list", strengthening supervision and management.

- Protection of rights and interests, and encouraging restoration. Strictly protect the lawful rights and interests of natural persons, legal persons, and other organizations in the process of making red and black list designations, publications, rewards, punishments, and other such processes. While improving the relevant laws and regulations, and clearing channels for relief such as raising objections or complaint appeals, simultaneously establish and improve systems for credit restoration, correcting untrustworthy behavior, and encouraging legal compliance and creditworthiness.

II. Scientifically formulate standards for designating targets of the joint reward and punishment lists

(3) Departments that set standards. In principle, each field is to apply nationally unified standards for red and black list designations, and those standards are to be researched and drafted by the unit members of the inter-ministerial joint conference on the establishment of a social credit system or by other state departments for industry regulation, in accordance with their duties of market regulation, social governance, and public service. Each relevant provincial department may formulate local standards as necessary, and implement them after approval from the regulatory department at the level above and the provincial people's government. In the course of drafting standards for making designations, the opinions should be fully solicited from the public. The standards released, and the specific designation procedures, should be announced and disclosed to the public through the "Credit China" website and other appropriate means.

(4) Standardize the Basis for Red and Black List Designations. The bases for making designations for lists of joint rewards and punishments mainly include: First is registration information of relevant entities reflected in public management and services; second is information on entities' creditworthiness status reflected in criminal punishments, administrative permits, adminstrative punishments, administrative compulsion, administrative confirmations, administrative inspections, administrative collections, administrative incentives, and administrative payments; third is information on refusal to perform effective judicial rulings; fourth is information such as on the receipt of commendations or rewards produced or learned of by party and government organs, mass organizations, social organizations, industry associations and chambers of commerce in the course of performing their duties; fifth is other information that may be used as the basis for red and black list designations, based on laws, regulations, rules, or normative documents.

(5) Continuously improve standards for list designations. The departments that formulate standards should retain third-party institutions to conduct assessments of the efficacy of implementing the standards for designating the list of targets for joint rewards and punishments that they supervise, should promptly improve the designation standards, and should follow the directory established by the inter-ministerial joint conference on the establishment of a social credit system to complete the system of standards for making list designations.

III. Strict procedures for red and black list designations

(6) Departments (units) making list designations. State organs at the county level or above, and organizations authorized by laws and regulations to have functions managing public affairs, may follow the uniform standards to make designations for red and black lists in related fields, and the relevant state departments may, as needed, authorize national industry associations, chambers of commerce, and credit service establishments to follow the uniform standards to make red and black list designations. Encourage industry associations and chambers of commerce, big data enterprises, financial institutions, news media, social organizations, and other types of units and individual citizens to provide information on related entities' trustworthy and untrustworthy conduct to the departments (units) making designations, and explore making this an important consideration in making red and black list designations.

(7) Procedures for designating the targets of joint disciplinary action for untrustworthiness. On the basis of the designation standards, the departments (units) making designations are to produce preliminary lists of targets for joint disciplinary action due to untrustworthiness, and may perform procedures for notice or announcements as needed. Where there are objections, the designating departments (units) are to verify them. Where natural persons are identified as targets for joint disciplinary action for untrustworthiness, advance notice should be given. Where laws or regulations already have other relevant provisions, follow those provisions. After 'blacklists' are formed, they should be cross-checked against the 'red lists' for each field on the national credit information sharing platform, and if 'blacklisted' entities were already entered onto 'red lists', they should be deleted from the relevant 'red lists'.

(8) Procedures for designating targets of joint incentives for trustworthiness. Based on the uniform standards, the departments (units) making designations are to produce a preliminary list of targets for joint incentives for the trustworthy, and cross-check it against the 'black lists' in each field on the national credit information sharing platform, to ensure that entities already entered into 'black lists' are not entered into 'red lists'. After screening, the preliminary lists may be publicly announced on the departments (units) making the designations' portal websites, local government credit websites, and the "Credit China" website. Where there are no objections after announcement, it is to be designated as the 'red list'; and where there are objections, they are to be verified by the departments (units) making the designations.

IV. Regulating the sharing and publication of list information.

(9) Regulate the content of list information. The principle content of list information includes: First is entities' basic information, including the names of legal persons and other organizations (or the full names of natural persons), the uniform social credit numbers, the global legal person entity identification numbers (LEI codes) (or citizens' ID numbers; citizen social credit numbers for residents of Hong Kong, Macao, or Taiwan; or ID numbers for foreign nationals), legal representatives' (or units' responsible parties) full names and ID type and number, and so forth; Second is the grounds for entry onto the list, including the facts of their honesty and trustworthiness or untrustworthy violations, the departments (units) making the designations, the basis for the designations, the date of the designations, the effective periods, and so forth; and third is circumstances regarding the relevant entities' receipt of incentives and disciplinary action, credit restoration, and removal from the list.

(10) Sharing list information. All levels of unit leading the establishment of the social credit system should establish catalogs for sharing list information, and strictly follow the catalogs to aggregate and share relevant information. The departments (units) making the designations should gradually report the designated lists and related information up to the regulatory department at the level above and to the unit leading the establishment of the social credit system at the same level, send it to the national credit information sharing platform within 10 working days of the designation, and carry out dynamic management. Relying on the national credit information sharing platform, establish a nationwide database of joint reward and punishment lists, to be shared and used by all levels of state organ and organizations authorized by laws and regulations to perform public affairs management functions.

(11) Publishing list information. In accordance with the principles of lawful disclosure, maintaining strict standards, and protecting rights and interests, the departments (units) making the designations should release 'red and black lists' to the public through their portal websites, local government credit websites, and the "Credit China" website. List information that involves enterprises, social organizations, or government departments should be released, in accordance with relevant provisions, on the national enterprise credit information system, the China social organization network, the State Commission Office for Public Sector Reform website, and other such channels. The publication of list information shall be objective, accurate and fair, and shall ensure the legality, authenticity, and accuracy of the released information. Necessary technical processing should be carried out before the release of information involving enterprises' commercial secrets and personal privacy. The time limit for the release of list information is the same as the validity period of the list. List information that cannot be disclosed in accordance with law, may be handled through reporting to the parties' units or other regulatory departments in accordance with law and discipline. Industry associations, chambers of commerce, and credit service establishments are encouraged to collect all relevant departments' (units') red and black lists, and, after verification, integrate them with relevant lists formed during those units' performance of duties or services, and release them to the public.

V. Carrying out joint rewards and punishments on the basis of the lists.

(12) Government departments' implementation of joint rewards and penalties. All levels of state organ, or organizations authorized by laws and regulations to have public affairs management functions, are to employ methods such as signing MOUs on joint incentives for the trustworthy and joint disciplinary action for the untrustworthy, to clarify the reward and punishment measures and means of implementation for relevant fields' redlisted and blacklisted entities, so long as relevant laws and regulations are complied with, and establishing joint mechanisms for initiation, response, and feedback. On the basis of the State Council's requirements for joint punishments and rewards, encourage all levels of state organ, and organizations authorized by laws and regulations to have public affairs management functions, to conduct comparisons of red and black list information with relevant information, and create conditions for inlaying information systems and specific work processes such as that departments' approvals, market supervision, and public services; take the lead into making querying and using red and black list information, promptly aggregating typical examples of joint incentives for the trustworthy and joint disciplinary action for the untrustworthy, keeping statistics on the status of joint rewards and punishments and putting these on the national credit information sharing platform.

(13) Encourage social forces to coordinate and participate in joint rewards and punishments. Actively create conditions for opening up database information from the national list of targets for joint rewards and punishment to all types of social organizations, industry associations and chambers of commerce, credit service establishments, financial institutions, designated non-financial institutions, public service organizations, and other enterprises and public institutions. Encourage all types of social institutions to query and use red and black list information, carrying out market, industry, and social constraints and punishments of entities on 'black lists'; and establish 'green channels' for entities on 'red lists', preferentially providing services and facilitation, optimizing administrative oversight arrangements for creditworthy enterprises, reducing market transaction costs, and forcefully recommending creditworthy market entities. Relevant units shall promptly give feedback on joint rewards and punishments to the departments (units) making red and black list designations, building joint reward and punishment mechanisms in which the entire society broadly participates.

VI. Build credit restoration mechanisms for turning over a new leaf.

(14) Encourage and support restoration of one's own credit Establish mechanisms for social encouragement and compassion that are beneficial to correcting one's own mistakes and actively turning over a new leaf, encourage 'blacklisted' entities to restore credit through methods such as actively correcting untrustworthy conduct and eliminating negative social impact; the departments (units) making designations may make restoration of credit an important consideration in removals from 'blacklists'.

(15) Regulate credit restoration processes. When relevant departments (units) make blacklist designations, they should integrate the seriousness of the untrustworthy conduct, and clarify whether the relevant entities can restore credit, and the methods and periods for restoration. 'Blacklisted' entities that can correct untrustworthy conduct by performing relevant duties may submit an application with supporting materials for removal from the list to the departments (units) that made the designations, after they have performed the relevant obligations.

VII. Establish and complete warning mechanisms for targets of key creditworthiness status scrutiny.

(16) Implement hierarchical management by type. Entities with more serious untrustworthy conduct occurring in key fields, or which have several occurrences of slight untrustworthy conduct, that have not reached the standard for entry into 'blacklists', may be entered into lists for key scrutiny by the departments (units) making designations, and joint disciplinary action corresponding to the degree of untrustworthy conduct may be carried out. Key scrutiny list information is to be shared with the national credit information sharing platform and selectively released externally.

(17) Warnings for targets of key credit status scrutiny The departments (units) making designations should use appropriate means to issue warnings to entities on the key scrutiny list, and tell them the time period for key scrutiny. Rely on the national credit information sharing platform to carry out data analysis, with entities that have been entered onto lists for key scrutiny in 3 or more key fields, being transferred to the 'Big Data Warning List' and an alert being issued to the public through the 'Credit China" website. Where entities on the key scrutiny list exhibit acts of serious untrustworthiness during the effective period, they should be promptly included on 'blacklists' in accordance with the 'blacklist' designation standards

VIII. Removal from lists in accordance with law

(18) Mechanisms for removal from lists of targets of joint disciplinary action for the untrustworthy; The validity periods for 'blacklists', and methods for credit restoration and removal from lists are to be determined by the departments (units) making designations, by combining the situation of the relevant entities' illegality and untrustworthiness. Removal from "blacklists" includes the following methods: First is by handling of objections, where the blacklisting of entities was in error, the departments (units) that made the designations should have the relevant entities deleted from the 'blacklists'; Second is early removal through restoration of credit before the blacklisting's validity period is completed, and this early removal requires the consent of the departments (units) that made the designations; Third is automatic removal at the completion of the blacklisting period; Fourth is where changes occur to the blacklists' designation standards, and entities that do not meet the new designation standards are to be deleted from the "blacklist". After entities have been removed from "blacklists", they should immediately be transferred to the key scrutiny list (except where they were entered on the blacklist in error), and the departments (units) that previously entered them into the blacklist are to determine the effective period.

(19) Mechanisms for removal for from the lists of targets for joint incentives. The validity period of 'red lists', are to be determined by the departments (units) making the designations, by combining the situation of the relevant entities' honesty and trustworthiness. Removal from "red lists" includes the following methods: First is where it is found through handling objections that redlisting the entity was in error, and the departments (units) that made the designation should delete the relevant entity from the 'red list'; second is where during the effective period, the entity is entered by relevant departments onto a 'blacklist' or key scrutiny list, or exhibits conduct making the use of 'redlist' incentives inappropriate, so that the departments (units) that made the designations should delete the relevant entities from the 'red lists'; third is automatic removal at the completion of the redlists' effective period; fourth is where there are changes to the standards for redlisting, and entities that do not meet the new designation standard should be deleted from the red list.

(20) Establish and complete mechanisms for coordinating removals from lists, lifting of rewards and punishments, and records storage. After relevant entities are removed from red or black lists, the departments (units) making the designation are to promptly announce their removal through the channels that were previously used for releasing the list, and related reward and punishment departments should stop their rewards and punishments, and the relevant list information should continue to be stored on the back-end of the national credit information sharing platform, credit service establishments may continue to store records of untrustworthiness for a certain period in accordance with laws and regulations. Where entities were entered into lists in error, the relevant information is not to be stored.

IX: Protection of Market Entities' Rights and Interests

(21) Establish and complete mechanisms for supervising feedback from targets of joint incentives for trustworthiness. Where relevant units or individuals have objections regarding the honest and trustworthy conduct of redlisted entities, they may give feedback and provide supporting materials to the departments (units) that made the designations, and the departments (units) that made the designations should promptly verify feedback they receive. Where it is verified that the feedback is true, the departments (units) should make a new designation regarding the concerned entity, and send the outcome of the designation to the persons giving feedback and the parties.

(22) Establish and complete mechanisms for objections and appeals by targets of joint disciplinary action for untrustworthiness. Where relevant units or individuals have objections to being entered onto a 'blacklist', they may submit objection appeals to the departments (units) making the designations and provide supporting materials. After receiving objection appeals, the departments (units) that made the designations should promptly give feedback on whether or not they are accepted, and give feedback on the outcomes of verification and handling to the parties as soon as possible; and where the parties still have objections to the outcomes, they may lawfully apply for a reconsideration.

(23) Establish and complete mechanisms for correcting list information. Where joint reward and punishment departments actively discover that list information is incorrect while they are carrying out joint incentives for the trustworthy or joint disciplinary action for the untrustworthy, or through relevant units or individuals submitting objection applications or complaints, they shall promptly inform the departments (units) that made the designations to verify it, and the departments (units) that made the designations should promptly verify it and give feedback. Where relevant units or individuals were incorrectly entered onto the 'blacklist' because of a work error, the departments (units) making the designations should promptly correct the parties' creditworthiness records, apologize in writing to the parties, and make clarifications to restore their reputations. Where it leads to a harm to the parties' interests, compensation is to be given in accordance with law. For entities incorrectly entered onto 'red lists' the rights and interests they received as joint incentives should be reclaimed to the extent possible.

X. Strengthening Protections of Personal Privacy and Information Security

(24) Protecting personal privacy. Clarify the scope of authority and procedures for querying and using personal information, complete work on security and protection of databases, establish and improve systems for personal information inquiry registration and review, to prevent information leaking. Where personal private information is disclosed intentionally or though work errors, the responsibility of the relevant units and individuals is to be strictly pursued in accordance with law.

(25) Safeguarding information security. Relevant departments and units should establish, improve, and strictly enforce systems of rules for safeguarding information security. Put in place and implement a stratified network security protection system in strict accordance with relevant laws and regulations, increasing the extent of management over the national credit information sharing platform, each departments' credit information system, and credit service establishments databases, to safeguard the lawful rights and interests of credit subjects, and ensure the nation's information security.

XI: Safeguard Measures

(26) Implement entity responsibility; All levels of unit leading the establishment of the social credit system should strengthen guidance, coordination, and oversight of the establishment of systems for joint incentives for the trustworthy and joint disciplinary action for the untrustworthy, Relevant state departments should formulate standards for making red and black list designations, and management measures, actively initiating and signing MOUs on joint incentives for the trustworthy and joint disciplinary action for the untrustworthy. State organs, and organizations authorized by laws and regulations to have public affairs management functions, at the county level or above, should strictly implement the designation standards and management measures for red and black lists in that field; making designations, publishing, aggregating, sharing, updating, and using red and black list information in accordance with law, and strictly enforcing each joint reward and punishment measure.

(27) Improve relevant laws and regulations. Accelerate research to advance credit legislation. In accordance with the requirement of strengthening creditworthiness restraints and coordinated management, each region and each department is to submit amendment suggestions or conduct targeted revisions for relevant provisions of all current laws, regulations, rules, and normative documents.

(28) Strengthen publicity and education. Use media such as newspapers, radio, television, and the internet, to select models of creditworthiness advocating honesty and trustworthiness and promptly exposing untrustworthy conduct in key areas, creating pressure from public opinion, spreading publicity in each region,

This document is to take effect on the date of publication, and remain in effect through December 31, 2020.

 

National Development and Reform Commission

The People's Bank

October 30, 2017

 

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