Opinions on Accelerating and Advancing the Construction of Credit Supervision, Warning and Punishment Mechanisms for Judgement Defaulters

Title: General Offices of the CPC Central Committee and the State Council "Opinions On Accelerating And Advancing The Construction Of Credit Supervision, Warning And Punishment Mechanisms For Judgement Defaulters"
Promulgating Entities:General Offices of the CPC Central Committee and the State Council
Reference number: 
Promulgation Date: 2016-9-25
Expiration date: 
Source of text: http://www.gov.cn/zhengce/2016-09/25/content_5111921.htm

This translation was completed with reference to a complete translation by Rogier Creamiers. Some portions were independently translated here prior to Rogier’s fantastic contribution and we have altered many other provisions to match CLT’s style and related, previously-translated documents. Translations on this site are regularly altered, and hopefully improved, by our users, but Rogier is not responsible for subsequent changes.
General Offices of the CPC Central Committee and the State Council "Opinions On Accelerating And Advancing The Construction Of Credit Supervision, Warning And Punishment Mechanisms For Judgement Defaulters"

Information on default by people who are subject to enforcement as determined through judicial procedures by a People’s Court is an important component of social credit information. Conducting credit supervision, warnings and punishment of judgement defaulters is conducive to stimulating persons subject to enforcement to consciously perform their obligations established in effective legal documents, to raising judicial credibility, and advancing the construction of the social credit system. So as to accelerate advancement of the establishment of mechanisms for credit oversight, warnings and punishment, the following opinions are hereby put forward.

I. General Requirements

(1) Guiding Thought. Comprehensively implement the spirit of the 18th Party Congress and its 3rd, 4th and 5th Plenums, deeply study the spirit of the series of important speeches by General Secretary Xi Jinping, closely focus on comprehensively advancing the overall deployment of “Five in One” and comprehensively advancing the strategic deployment of the “Four Comprehensives”, firmly establish new development ideas, further raise People’s Courts’ enforcement work capacity according to the relevant requirements of fostering and practicing the Socialist core value view, advancing credit information sharing, completing incentive and punishment mechanisms, and raising the sincerity levels of the entire society, accelerate the construction of cross-departmental supervision and joint punishment mechanisms for Judgment defaulters, build credit supervision, warming and punishment work mechanisms where if trust is broken in one place, restrictions are imposed everywhere, safeguard judicial authority, raise judicial credibility, and create an upward, charitable, sincere and mutually helpful social atmosphere.
(2) Basic principles

——Persist in Lawfulness. Credit oversight, warnings and punishments for judgment defaulters should be implemented in strict accordance with laws and regulations.
——Persist in information sharing. Eliminate all barriers for credit information between each region and departments, and between state organs and people's organizations, social organizations, enterprises and public institutions, to advance the inter-connectivity and interworking of credit information and its exchanges and sharing.
——Persist in joint disciplinary action. All regions and departments should perform their respective duties, mutually cooperate, combine forces, to form a credit oversight, warning and punishment system where a default in one location results in restrictions in all areas.
——Persist in government leadership and social collaboration. All levels of government should play a leadership role, and at the same time give play to strength in all areas, pushing all of society to participate together, govern together, and bring about an effective integration of government leadership and social collaboration.

(3) Establishment targets. By 2018, a marked enhancement of the people's courts' enforcement capacity, and an implementation linkage system with convenient, smooth, and efficient operations. The Judgment Defaulters List system is to be more scientific and improved; and judgment defaulters' designation and management, transfer, screening, and revocation, and so forth, of judgment defaulters' information is to be lawful, effective, accurate, and prompt. Judgment defaulters' information and all kinds of credit information is shared, and mechanisms for credit oversight, warnings and punishment, with joint disciplinary action as their core, are efficiently operated. Effectively promote persons subject to enforcement conscientious performance on obligations determined in effective judgments from the people's courts, fundamentally resolve difficulties in enforcement, substantially boosting the credibility of the judiciary, with honesty and dependability becoming the common values and norms of the entire society.

II, Strengthening joint punishment.

(1) Limits on engaging in particular industries or projects

1．Limits on establishing financial companies. Make judgment defaulter information a consideration for due diligence during examination and approval for the establishment of banking or financial bodies or their branch bodies, as well as in purchasing shares in or acquisition of banking and financial bodies, and is a reference for due diligence in the examination and approval of establishing securities companies, financial management companies and futures companies, as well as registration as managing personnel in private investment funds. Restrict Judgment defaulters from establishing financial guarantee companies and insurance companies.
2. Limits on issuing bonds. Strictly review issuance of bonds by judgment defaulters in the inter-bank market, limit judgment defaulters' public issue of corporate bonds.
3. Limits on numbers of qualified investors. Make circumstances of delinquency a basis of careful consideration in the examination, approval,and management of qualified foreign institutional investors and domestic institutional investors.
4. Limits on equity incentives. Assist in suspending the equity incentive plans where the delinquent delinquent person subject to enforcement is a domestic state-owned listed company; where the delinquent delinquent person subject to enforcement is a domestic state-owned listed company, assist in terminating eligibility to enjoy equity incentives.
5. Limit issuance of shares and listings transfers. Make information concerning Judgment defaulters a consideration in the issuance of shares and examination and verification of share quotess and open transfer in the nationwide small and mid-size enterprise share transfer system.
6. Limits on the establishment of social organizations. Make judgment defaulter information a consideration in review and approval of initiation of social organizations, limit judgment defaulters establishment of social organizations.
7. Limits on participation in government investment projects or projects primarily using public finance capital. Assist people's courts in making inquiries into government procurement project information; lawfully restrict judgment defaulters from acting as suppliers in government procurement activities; Lawfully limit judgment defaulters' participation in government investment projects or project primarily using public finance capital.

(2) Limits on government support or subsidies.

1. Limits on obtaining government subsidies. Limit judgment defaulters' applications for government subsidies and social security funding supports.
2. Limits on obtaining policy support. When reviewing applications for policy support in investments, import/export, or science and technology; make inquiries as to whether the relevant organization and its legally-designated representative, actual control person, directors, supervisors and senior management are judgment defaulters, and make this a prudential consideration in their enjoyment of the policies.

(3) Limits on occupational qualifications

1. Limits on serving as an executive in a state-owned enterprise. Where judgment defaulters are individuals, they are restricted from serving as the directors or supervisors of wholly state-owned companies or state-owned capital holding company, as well as from serving as a director, supervisor or senior manager appointed or recommended by the state-owned equity partner in a state-owned capital joint stock company; where they are already serving in such a role, they are to be lawfully removed accord in accordance with relevant procedures.
2. Limits on serving as the legally-designated representative of public institutions. Where judgment defaulters are individuals, restrict them from being registered as the legally-designated representative of a public institution.
3. Limits on serving as the executive of a financial institution. Judgment defaulters are restricted from serving as directors, supervisors or senior management of banking sector financial institutions, securities companies, fund management companies, futures companies, insurance companies, and finance guarantee companies.
4. Limits on serving as the responsible party of a social organization. Where judgment defaulters are individuals, restrict them from being registered or recorded as the legally-designated representative of a social organization.
5. Limits on recruiting (hiring) as public servants. Judgment defaulters are restricted from being recruited (hired) as public servants or staff at public institutions, and where judgment defaulters are employed as public servants or staff of public institutions, their default should be a consideration in their assessments, appraisals, and promotions.
6. Special limits on entering the Party or on Party members. Make strict compliance with the law and performance on obligations set forth in effective legal judgments, a major consideration in applications to enter the Chinese Communist Party, the promotion of probotationary Party members to full Party member status, and the assessments, appraisals and promotions of Party members.
7. Limits on serving as Party representatives, people's representatives, and political consultative conference members. Where judgment defaulters are individuals, the are not to be an organizations' recommendation as a Party representative at any level, a people's representative at any level, or a candidate for political consultative conferences member.
8. Limits on military service. Where judgment defaulters are individuals, their default is to be made a major consideration in entering military service and the evaluation, assessment, and promotion of active duty or reserve officers.

(4) Limits on eligibility for admittance

1. Limits on customs certification. Judgment defaulters are restricted from becoming Customs certified enterprises; when judgment defaulters handle customs clearance matters, carry out tight over tight oversight and strengthen document review or inspection monitoring.
2. Limits on engaging in the pharmaceutical and food sectors and other such industries. Be strict in review and approvals of judgment defaulters engaging in the food and drug safety industries；restrict judgment defaulters from engaging in the production, trading and storage of dangerous chemical products, the production and trading of fireworks and firecrackers, mining production and security evaluation, authentication, monitoring, inspection and other such activities; restrict Jjudgment defaulters from taking up the position of major responsible person, director, board member or high-level manager in work units in the above-mentioned sectors, those already employed in such position are to be transferred according to the requirements or regulatory procedure.
3. Limits on eligibility for housing or construction enterprises. Situations of building or construction enterprises not lawfully performing the duties set forth in effective legal documents are to be entered into the housing and building market credit archive with relevant information made public, and restrictions are to be imposed on their business qualifications.

(5) Limits on honors and credit

1. Restrictions on being awarded honorary titles such as civilized city, civilized town, civilized work unit, civilized household, model of virtue, philanthropist, and so forth. The implementation of effective People’s Court judgments is to be made be a precondition for selection as civilized town, civilized work unit and civilized household, and an indicator for the assessment of civilized city. Where relevant bodies and their legally-designated representatives, actual controller, directors, board members, or high-level managers are judgment defaulters, they may not participate in the selection of honors such as civilized work unit and philanthropist, and honorary titles of civilized work unit or philanthropist that are obtained after having been listed as a judgment defaulters are to be cancelled. Where judgment defaulters are individuals, they may not participate in the selection of models of virtue and philanthropic honors, and models of virtue honorifics as well as philanthropic titles that are obtained after having been listed as a judgment defaulters are to be cancelled.
2. Limits on honors for lawyers and law firms. Assist People’s courts in making inquiries into identity information of judgment defaulters that are lawyers and the registration information of legal practices that are judgment defaulters; where judgment defaulters are lawyers or law firms, they are restricted from participating in competitions and rankings of excellence for a certain period.
3. Limits on credit awards. Banking and finance bodies must, when awarding financial credit, investigate whether the credit awardee or its legally-designated representative, principle responsible persons, actual controllers, directors, supervisors and high-level management personnel are judgment defaulters, and where the credit awardee is a judgment defaulters, they must strictly review and verify the matter.

(6) Limits on special market transactions.

1. Limits on trading in immovable property and State-owned assets. Assist People’s courts in investigating immovable property registration, and restrict judgment defaulters as well as their legally-designated representatives, principle responsible persons, actual controllers, and personnel directly responsible for influencing the performance on debt obligations, from buying or obtaining houses, land use rights and other such immovable property; restrict judgment defaulters from engaging in the exploitation of immovable property and resources such as land and minerals, or from participating in transactions concerning the assets of state-owned enterprises, State assets, or other such state assets.
2. Limits on using State-owned woodlands. Restrict judgment defaulters from applying for projects using State-owned woodland; and restrict them from applying for key forestry construction projects.
3. Limits on using grasslands. Restrict judgment defaulters from applying for grassland usage and requisitioning projects; restrict them from applying to take on national grassland protection and construction projects.
4. Limits on the use of other State-owned natural resources. Restrict judgment defaulters from applying for projects exploiting State-owned natural resources such as rivers, maritime areas, uninhabited islands, mountain ranges, wastelands, and shoals; and key natural resource protection and construction projects.

(7) Limits on high spending and related consumption.

1. Limits on riding trains and airplanes. Restrict judgment defaulters and their legally-designated representatives, principle responsible persons, actual controllers, and directly responsible persons influencing the performance of debt obligations, from riding soft sleepers in trains, all seats in G-classed train sets, and all first-class seats in other train sets, civil aircraft and other such consumption that is not necessary for life or work.
2. Limits on guesthouse and hotel stays. Restrict judgment defaulters and their legally-designated representatives, principle responsible persons, actual controllers, and directly responsible persons influencing the performance of debt obligations, from staying in star-rated and higher guesthouses and hotels, national first-level and higher hotels and other high cost accommodations; and restrict them from spending in nightclubs, golf courses and other such high cost venues.
3. Limits on high-cost travel. Restrict judgment defaulters and their legally-designated representatives, principle responsible persons, actual controllers, and directly responsible persons influencing the performance of debt obligations, from participating in foreign tour groups organized by travel agencies, as well as enjoying other services provided by travel agencies related to foreign travel; and carry out quota controls on judgment defaulters' spending in holiday areas or travel businesses that have obtained tourism ranking evaluations.
4. Limits on children attending high-cost schools. Restrict judgment defaulters and their legally-designated representatives, principle responsible persons, actual controllers, and directly responsible persons influencing the performance of debt obligations, and their assets, from paying for their children to attend high-cost private schools.
5. Limits on purchasing cash value insurance. Restrict judgment defaulters and their legally-designated representatives, principle responsible persons, actual controllers, and directly responsible persons influencing the performance of debt obligations, from playing high-cost premiums to buy cash value insurance products.
6. Limits on newly building, expanding, or high-grade renovations of housing, and so forth. Restrict judgment defaulters and their legally-designated representatives, principle responsible persons, actual controllers, and directly responsible persons influencing the performance of debt obligations, from newly building, expanding or expensively renovating housing, or purchasing cars and other such products not necessary for life or work.

(8) Assisting with inquiry, control and foreign travel restrictions
Assist people’s courts in lawful inquiries into judgment defaulters' identities, border entry or exit permits and vehicle information, assist in the sealing up or seizure of vehicles in the name of judgment defaulters, assist in in searching for and controlling judgment defaulters whose whereabouts are unknown, and restrict judgment defaulters exiting the country.
(9) Strengthening routine supervision, management and inspection
Make judgment defaulters and work units that have judgment defaulters as their legally-designated representatives, main responsible persons, actual controllers, directors, supervisors and high-level managers, key targets for supervision, increase the force of routine supervision and management, raise the proportion and frequency of random inspections, and administrative supervision and management measures may be adopted against them on the basis of relevant laws and regulations.
(10) Increase the force of criminal punishments
Acts of refusal to implement effective judgments and rulings, as well as other acts impeding enforcement that constitute a crime are to promptly investigated, indicted and tried in accordance with law, public security organs, procuratorates, and people’s courts.
(11) Encouraging limits in other areas
All levels’ of Party and government organ, people’s organization, social organization, enterprise and public institution are encouraged to use Judgment Defaulters List information, and integrate it into their own areas of competency, operational scopes, and business activities; to carry out credit supervision, warning and punishment of judgment defaulters.

III. Strengthening information openness and sharing

(1) Disclosure of information on defaults
People’s courts should promptly and accurately update Judgment Defaulter List information, and disclose it publicly and provide free public inquiries through various means such the National People’s Courts Judgment Defaulter List Information Publication and Inquiry Platform, relevant websites, mobile client terminals, and outdoor media; and, as needed for joint punishment work, people’s courts may send Judgment Defaulter List information to relevant units, for their lawful utilization integrated with their own work. For judgment defaulters whose default information is not suitable for disclosure according to the law, people’s courts should notify their workplace, and their workplace is to impose punishment in accordance with discipline and law.
(2) Inclusion in Disclosure of government affairs
All localities and departments should follow the relevant requirements of the CCP Central Committee General Office and the State Council General Office's “Opinions Concerning Comprehensively Advancing Openness in Government Affairs”, to list information concerning credit supervision, warning and punishment of judgment defaulters as an item for openness in governmental affairs; and lawfully carry out credit supervision, warning and punishment of judgment defaulters on the basis of the list of departmental powers, list of responsibilities, and negative list.
(3) Credit information sharing
Information barriers between all areas and all departments should be further dismantled to realize information sharing, and, through a national credit information sharing platform, accelerate the sharing of judgment defaulter information with credit information sources of departments such as for public security, civil affairs, human resources and social security, land and resources, housing and urban construction, finance, banking, taxation, industry and commerce, security supervision, securities, and science and technology; and advance sharing judgment defaulter information with credit information sources of relevant people’s organizations, social organizations, enterprises and public institutions.
(4) Constructing systems and mechanisms for sharing
Accelerate the construction of systems and mechanisms for sharing judgment defaulter credit information; establish and complete information sharing mechanisms between government and credit investigation bodies, credit rating bodies, financial bodies and social organizations. Establish social credit file systems, bringing judgment defaulters information into the social credit rating system as an important credit rating index.

IV. Improving relevant systems and mechanisms

(1) Further raising capacity for enforcement, investigation and control

1. Accelerate the construction of an online enforcement investigation and control system. Increase the application of informative measures in enforcement work, integrate and improve existing court informatization systems, and bring about networked enforcement work mechanisms for locating judgment defaulters and controlling assets. Through governmental affairs networks and specialized networks, and so forth, ensure that people’s courts' enforcement inspection and control networks are interconnected with networks of government departments such as for public security, civil affairs, human resources and social security, land and resources, housing and urbanization construction, industry and commerce, traffic and transportation, agriculture, the People’s Bank, banking supervision, securities oversight, insurance oversight, foreign exchange management; and also enterprises and public institutions such as financial bodies, Unionpay, and Internet enterprises; to build a networked and automated system for enforcement investigation and control covering all regions and major asset forms such as land, housing, savings, financial products, securities, shares, and vehicles; and bring about inter-connectivity and full application by the four levels of court nationwide.
2. Expand enforcement inspection and control measures. People’s courts should further expand asset inspection and control measures for defendants and persons subject to enforcement. Research and formulate asset investigation and control systems such as systems for asset reporting by persons subject to enforcement, systems for lawyers to investigate the assets of persons subject to enforcement, systems for public announcement of offered rewards, and systems for audits and investigations.
3. Improve systems for remote direction of enforcement. The Supreme People’s Court all high and intermediate-level People’s courts, as well as basic-level People’s courts that have the capacity, should establish enforcement command centers and remote command systems, so that the operations of of all four levels of court's enforcement command systems are networked. Establish enforcement command work systems and mechanisms that are integrated upstream and downstream, are connected internally and externally, are standardized and efficient, and have rapid response. Establish networked enforcement and case-handling platforms, disclosure platforms and nodal case flow management platforms that are uniform for the four levels of court.

(2) Further improve the Judgment Defaulter List system

1. Improve systems for making entries to the list. All levels’ People’s courts should, on the basis of their authority to handle enforcement cases, strictly follow legally prescribed requirements and procedures to decide whether a person subject to enforcement is entered on the Judgment Defaulters List.
2. Ensure that list information is accurate and standardized. People’s courts should establish strict operational rules and review and correction mechanisms, to ensure that information on the Judgment Defaulter List is accurate and standardized.
3. Risk alerts and remedies Before a person subject to enforcement is entered on to the list, people’s courts shall issue them a risk warning notification. Where persons subject to enforcement believe their entry on the default list is in error, they may apply to the people’s court issuing the decision within 10 days of their receiving it, and the people’s courts shall review the matter within three days of receiving the application, cancelling [the entry to the list] where the reasoning is sustained, and rejecting [the application] where the reasoning is not sustained. Where persons subject to enforcement do not accept the rejection, they may apply for reconsideration with the people’s Court at the level above.
4．Removal from the defaulters list. When judgment defaulters have completely fulfilled the duties set forth in valid legal documents, or they have reached a settlement with the person applying for enforcement reconciliation and the person applying for enforcement has confirmed that performance was completed, or enforcement in the case has been concluded in accordance with law, and so forth, the people’s court should block or delete their information from the defaulters list within three days. Blocked or deleted information should be promptly disclosed to the public and the transferring unit.
5．Release from punitive measures. Where blocking or deletion has occurred in the defaulters list, all credit supervision, warning and punishment units should promptly release punitive measures taken against the person subject to enforcement. Where it is truly necessary to continue credit supervision, warning and punishment of a person subject to enforcement, this must be carried out in strict accordance with the relevant provisions of laws and regulations, and the period for the continuation made clear.
6．Pursuing responsibility. Further improve systems for pursuing responsibility, following relevant provisions to pursue responsibility for conduct such as not including people in the defaulter list but are not, unlawful inclusion in the defaulter list, and also not following rules in blocking or deleting information from the defaulter list.

(3) Further improve systems for Party and government organs' support the People’s Courts’ enforcement efforts

1. Further strengthen enforcement assistance work. All areas and all departments should follow the requirements of establishing and improving joint enforcement mechanisms, taking further hold of implementation efforts. All levels’ of leading groups for joint enforcement mechanisms should formulate specific work mechanisms and procedures, and clarify the specific duties of all enforcement assistance units. Strengthen the work assessment and accountability for enforcement assistance work; departments such as for organization, human resources, political and law, should establish mechanisms for periodic joint reporting of enforcement assistance, to report and hold accountable units with lackluster enforcement assistance.
2. Strictly implement comprehensive evaluation and responsibility for enforcement work. Make the joint punishment of judgment defaulters an important element of omprehensive social order management target assessment evaluation responsibility. Strictly implement the relevant requirements of people’s court enforcement work in comprehensive social order management target assessment evaluation responsibility.
3. Strengthen pursuit of Party and government organs' responsibility for interfering in enforcement. Party and government organs should conscientiously perform on effective judgments of the people’s courts, and place the implementation situation within entity responsibility for establishment of Party integrity and clean governance, and within the scope of oversight responsibility. Firmly implement the CCP Central Committee General Office and State Council General Office's “Provisions on Recording, Reporting and Pursuing Responsibility of Leading Cadres Interfering with Judicial Activities or Tampering with the Handling of Specific Cases”, as well as the “Provisions On Recording And Pursuing Responsibility Of Judicial Organ Personnel Prying Into Cases”, to address in strict accordance with discipline and law, the cases where relevant departments and leading cadres interfere with enforcement, obstruct enforcement or do not cooperate with enforcement work

V. Strengthening organizational leadership

(1) Strengthening organization and implementation
All areas and departments should pay great attention to the credit supervision, warning and punishment work of judgment defaulters; and make them into an important part of comprehensively advancing ruling the country in accordance with law, advancing the construction of the social credit system, and fostering and practicing the socialist core values, and truly strengthening organizational leadership. Further strengthen and improve the interdepartmental joint conference system for the construction of the social credit system, and create normalized working mechanisms All constituent units should designate specialized bodies and specialized personnel responsible for overall planning and coordination, supervising and inspection of the implementation of all tasks, and report to the interdepartmental joint conference, and where work is not carried out satisfactorily, circulate criticisms and strengthen accountability. Departments with information sharing and joint punishment duties should take hold of the drafting of specific implementation rules, designating responsible departments, clarifying timeframes and roadmaps, and ensuring that all measures are satisfactorily put in place before the end of 2016. All joint punishment units should complete their linkage with the Nationwide Credit Information Sharing Platform Joint Punishment System, to automatically obtain Judgment Defaulter List information through the network, and give prompt feedback on the punishment situation. At the same time, they should accelerate the schedule in the development and use of software, and build Judgement Defaulter List information into their unit’s management, review and approval, and work systems; to bring about the automatic verification, automatic interception, automatic supervision and automatic punishment for Judgment Defaulter List Information.
(2) strengthening job security
All localities and departments should earnestly implement the Center's requirements for resolving issues of difficultly in enforcement by People’s Courts, strengthening the function and role of enforcement bodies, creating full and robust enforcement teams, vigorously advancing normalized, specialized and professionalized team construction. Accelerate the progress of hardware and software construction for the People’s Court Enforcement Inspection and Control System and the Enforcement Command System, accelerate the construction of a national credit information sharing platform, accelerate hardware constructions and software developments such as for special information transmission lines and storage equipment for all information sharing units and joint punishment units, and strengthen safeguards for areas such as talent, funding, equipment and technology.
(3) Improving relevant legal provisions
Accelerate legislative, revision, abolition and interpretation efforts on compulsory enforcement law and other relevant laws and regulations, judicial interpretations and other normative documents; promptly legalize and institutionalize work such as strengthening enforcement efforts, advancing joint enforcement, sharing and disclosure of credit information, improving the Judgment Defaulters List system, and strengthening joint punishment; to ensure that legal norms are scientific, focused and practical of legal norms.
(4) Increase the force of publicity
Strengthen the force of publicity on the Judgment Defaulter List and credit punishments, giving full play to the role of the news media in publicity, oversight and guiding public opinion. Use media such as the newspapers, radio, television, and networks to publicly reveal information about judgment defaulters, the punishment they receive, and so forth, to create pressure from public opinion, and expand the influence and deterrent force of the Judgment Defaulters List.