Market Regulation Measures on the Management of the List of the Untrustworthy with Serious Violations

Promulgation Date: 2021-7-30
Title: Market Regulation Measures on the Management of the List of the Untrustworthy with Serious Violations  
Document Number:国家市场监督管理总局令第44号
Promulgating Entities: State Administration for Market Regulation
Source of text: http://gkml.samr.gov.cn/nsjg/fgs/202108/t20210801_333255.html

Article 1: These Measures are formulated on the basis of relevant laws and administrative regulations so as to regulate the management of the List of the Untrustworthy with Serious Violations by the departments for market oversight and management, to strengthen credit regulation, expand social oversight, and promote creditworthiness and self-discipline.

Article 2: Where parties violate laws and administrative regulations in a vile nature, with serious circumstances, posing a larger threat to the public, and receive a heavier administrative punishment from the departments for market regulation, the market regulation departments are to enter them in the List of the Untrustworthy with Serious Violations in accordance with these Measures, publicly display them on the National Enterprise Credit Information Publicity System, and carry out corresponding management measures.

"Heavier administrative punishments" as used in the preceding paragraph include:

(1) Fines given in accordance with the principle of giving heavier penalties based on the discretionary benchmarks for administrative punishments;

(2) lowering qualification levels, cancelling permits and business licenses;

(3) Restrictions on carrying out business activities, ordering a suspension of operations, ordering closure, or restricting practice;

(4) Other heavier administrative punishments as provided by laws, administrative regulations, and department rules.

Article 3: The State Administration for Market Regulation is responsible for organizing and leading efforts to manage the List of the Untrustworthy with Serious Violations for the entire country.

Local departments for market regulation at the county level or above are responsible for efforts to manage the List of the Untrustworthy with Serious Violations in accordance with these Measures.

Article 4: The market regulation departments shall share information from the List of the Untrustworthy with Serious Violations with other relevant departments in accordance with provisions, and carry out joint disciplinary actions in accordance with laws, administrative regulations, and policy documents of the Party Central Committee and State Council.

Article 5: Where any of the following illegal acts are carried out in the field of food safety and it is within the circumstances provided for in article 2 of these Measures, it is to be included in the List of the Untrustworthy with Serious Violations (Food Safety Blacklist for Serious Violations of Law in Production and Business).

(1) Engaging in food production and business activities without obtaining food production and business permits in accordance with law;

(2) Using non-food materials to produce food; adding chemicals other than food additives to food or adding other materials that might be harmful to human health; producing or trading in foods or supplements for the use of specified groups such as infants and children that do not meet food safety standards for nutritional content; producing or trading in foods that have drugs added; producing or trading in meat, poultry, or seafood that died of illness, poison, or unknown causes; producing or trading in meets that have not been inspected in accordance with provisions or did not pass inspections; producing or trading in foods that the state has ordered a prohibition on the production or trading on in order to prevent disease;

(3) Producing or trading in foods or food additives that have materials that are harmful to human health such as pathogenic microorganisms, pesticide residues, veterinary medicine residues, biotoxins, heavy metals, or other pollutants in volumes exceeding food safety standards; producing or trading in foods produced with ingredients or food additives that have expired; producing or trading in health foods, medical-use formula, or infant formula and milk powder than have not been registered in accordance with provisions, or that were not produced in accordance with the registered product formula, production process or other technical requirements; or where food labels or instructions contain false content involving disease prevention and curative functions, or where labels and instructions for foods other than health foods claim they have health functions.

(4) Other illegal acts violating food safety laws and administrative regulations that seriously endanger the physical health and lives of the public.

Article 6: Where any of the following illegal acts are carried out in the drug, medical implement, or cosmetics sectors and it is within the circumstances provided for in article 2 of these Measures, it is to be included in the List of the Untrustworthy with Serious Violations:

(1) Production or sale of fake or shoddy medicines; illegal production or sale of medicines (including vaccines) for which the state has special management requirements; or the production, import, or sale of medicines (including vaccines) that have not obtained approval documents;

(2) The production or sale of type 2 or type 3 medical instruments that have not been registered;

(3) The production or sale of cosmetics with illegal additives that might be harmful to human health are produced or sold.

(4) Other illegal acts violating laws and administrative regulations on drugs, medical instruments, and cosmetics that seriously endanger the physical health and lives of the public

Article 7: Where any of the following illegal acts are carried out in the quality safety sector and it is within the circumstances provided for in article 2 of these Measures, it is to be included in the List of the Untrustworthy with Serious Violations:

(1) The production, sale, rental, or use of special equipment that has not obtained production permits, that the state has declared obsolete, that has been scrapped, that has not been tested or did not pass tests; or filling mobile pressure containers and gas canisters that do not meet the requirements of technical safety regulations.

(2) The production or sale of products that do not meet national standards for ensuring health and life safety, or that have been contaminated or adulterated; passing off fake products as real, seconds as full quality, or non-compliant products as compliant; or producing or selling products that the state has declared obsolete;

(3) Being announced by a market regulation department of a people's government at the provincial-level or above as not compliant in a product quality oversight inspection, and still being non-compliant in a re-examination after the announcement;

(4) Presenting fake or seriously untruthful inspection, testing, certification, or recognition conclusions, seriously endangering quality safety;

(5) Counterfeiting, falsely using, buying, or selling, certification labels or documents; or shipping, selling, importing, or using products listed in the directory requiring certification that have not been certified without authorization, or using them for other business activities;

(6) Other illegal acts violating laws and administrative regulations in the quality safety sector that seriously endanger the physical health and lives of the public.

Article 8: Where any of the following illegal acts are carried out infringing on consumer rights and it is within the circumstances provided for in article 2 of these Measures, it is to be included in the List of the Untrustworthy with Serious Violations:

(1) Infringing on consumer rights to personal dignity and in personal information that are protected by law;

(2) Absconding, refusing to perform obligations, closing down operations, or moving service venues after collecting advance payment, not providing goods or services as provided in agreements, and being confirmed as unable to be contacted by the market regulation departments;

(3) Creating, selling, or using measurement devices for the purpose of defrauding consumers; plagiarizing, colluding, or altering data from measurement devices, faking data, or presenting fake calibration documents or reports, infringing consumer rights and interests;

(4) Refusing or delaying the recall of defective products after being ordered to recall;

(5) other illegal acts in violation of laws or administrative regulations that seriously harm consumers' rights and interests.

Article 9: Where any of the following illegal acts are carried out that undermine fair competition and disrupt market order and are within the circumstances provided for in article 2 of these Measures, it is to be included in the List of the Untrustworthy with Serious Violations:

(1) Violating commercial secrets, commercial defamation, organizing fake transactions, and other acts of improper competition that seriously undermine the order of fair competition;

(2) intentionally infringing on intellectual property rights; submitting irregular patent applications or malicious applications for trademark registration, harming the societal public interest; or engaging in seriously illegal patent and trademark agency conduct;

(3) Price collusion, selling at reduced rates, or driving up prices; not implementing the government set pricing or directed pricing for products and services related to national welfare and the people's livelihood, or not implementing price interventions and emergency measures employed to address emergency situations;

(4) Organizing or planning multi-level marketing or providing conditions for multi-level marketing;

(5) Publishing false advertising on goods or services related to consumers' health or lives;

(6) other illegal acts in violation of laws or administrative regulations that seriously undermine fair competition or disrupt market order.

Article 10: Where any of the following illegal acts are carried out and it is within the circumstances provided for in article 2 of these Measures, it is to be included in the List of the Untrustworthy with Serious Violations:

(1) Engaging in business activities without obtaining other permits in accordance with law;

(2) Submitting fake materials or employing other tactics to conceal important facts to obtain administrative permits; to obtain, change, or register market entity registrations; or to alter, resell, rent, or sell permits or business licenses;

(3) Refusing, obstructing, or disturbing market regulation departments lawful carrying out of oversight inspections and accident investigations.

Article 11: After the departments for market regulation make an administrative punishment, administrative decision, or other such administrative decision, parties have the ability to perform but refuse to do so or evade enforcement, seriously impacting the credibility of the market regulation departments, they are to be entered into the List of the Untrustworthy with Serious Violations.

Where laws, administrative regulations, and policy documents of the Party Central Commission and State Council have provisions on entering the responsible persons of market entities into the List of the Untrustworthy with Serious Violations, follow those provisions.

Article 12: Market regulation departments making judgments on whether illegal acts have a vile nature, serious circumstances, or are a larger threat to society, they shall comprehensively consider factors such as the subjective malice, the frequency of violations, the time they were sustained, the type of punishments, the amount fined or confiscated, the value of products, the threat to the public's health or lives, property losses, and the social impact.

Where parties have evidence sufficient to prove they had no subjective intent, they are not to be entered into the List of the Untrustworthy with Serious Violations.

Article 13: When the departments for market regulation make an administrative punishment decision, they shall make a decision on whether or not to enter it in the List of the Untrustworthy with Serious Violations. The decision documents for entry shall indicate the grounds, basis, punishment measure notices, requirements and procedures for removal, as well as remedial measures. Before a decision for entry is made, the parties shall be notified of the grounds and basis for making the decision, and of the rights that the parties enjoy. Procedures for notice, hearing evidence, service, handling objections, and so forth shall be carried out together with administrative punishment procedures.

Where a decision on entry into the List of the Untrustworthy with Serious Violations is made in accordance with the preceding paragraph, The market regulation department that made the decision is responsible for the work of managing the List of the Untrustworthy with Serious Violations.

Where entry into the List of the Untrustworthy with Serious Violations is due to the circumstances of article 11 of these Measures, the entry decision may be made independently. Procedures for notice, hearing evidence, service, handling objections, and so forth shall be carried out with reference to the procedures for administrative punishments.

Article 14: Where the market regulation department that made the entry decision is in the same province, autonomous region, or directly governed municipality as the site of the party's registration (domicile), the market regulation department that made the decision shall display the relevant information on the National Enterprise Credit Information Publicity System within 20 working days of making the decisions.

Where the market regulation department that made the entry decision is not in the same province, autonomous region, or directly governed municipality as the site of the party's registration (domicile), the market regulation department that made the decision shall send the information on inclusion in the List of the Untrustworthy with Serious Violations to the market regulation department for the site of the party's registration (domicile) within 10 working days of making the decision, and that department is to assist in displaying the information through the National Enterprise Credit Information Publicity System within 10 working days of receiving it.

Article 15: The departments for market oversight and management are to carry out the following management measures against those entered on the List of the Untrustworthy with Serious Violations:

(1) Make a key factor for consideration when reviewing for administrative permits, qualifications, credentials, entrustment to undertake government procurement projects, and project bidding, on the basis of laws, administrative regulations, and policy documents of the Party Central Commission and State Council;

(2) Make them the target of key oversight, increase the frequency of inspections, and make regulation stricter in accordance with law;

(3) Do not apply the notice and pledge system;

(4） Do not confer honorifics and other commendations or rewards from the market oversight and management departments;

(5) other management measures provided for by laws, administrative regulations, or policy documents of the Party Central Commission or State Council.

Article 16: Where parties have been listed in the List of the Untrustworthy with Serious Violations for a full year and meet the following conditions, they may apply to the market regulation departments for early removal in accordance with these Measures.

(1) They have conscientiously performed obligations provided for in the administrative punishment decision.

(2) They have proactively eliminated harmful consequences and negative impact;

(3) They have not received another heavier administrative punishment from the market regulation departments.

Where laws or administrative regulations provide that the period for carrying out corresponding management measures is not complete, they must not apply for early removal.

Article 17: Where parties apply for early removal, they shall submit a written recommendation, a written pledge of trustworthiness, materials showing that they have performed the obligations provided for in items (1) and (2) of the first paragraph of article 16, and an explanation of the facts and reasons.

The market regulation departments shall make a decision on acceptance within 2 working days of receiving an application. Where the application materials are complete and comply with the format prescribed by law, they shall be accepted.

The market regulation departments shall review the application make a decision on whether to grant removal within 15 working days of receiving an application.

Article 18: Where the market regulation departments make a removal decision, they shall stop displaying the relevant information within 3 working days and lift the relevant management measures.

Article 19: Where the basis for the administrative punishment of entry into the List of the Untrustworthy with Serious Violations is revoked or found illegal or invalid, the market regulation departments shall revoke the decision to enter the party is to be revoked, and the relevant information is to stop being displayed within three working days, and the related management measures lifted.

Article 20: Where the party applying for removal intentionally conceals the truth or provides false materials and the circumstances are serious, the market regulation departments are to revoke the removal decision and restore them to entered status. The display period is to be recalculated.

Article 21: Three years from the date on which parties are entered into the List of the Untrustworthy with Serious Violations, the market oversight and management departments that entered them into the list are to remove them from the list, stop displaying their relevant information, and lift the related management measures. Where in accordance with laws and regulations, measures such as restrictions on carrying out business activities or on practice are to exceed three years, they are to be implemented in accordance with the actual time period.

Article 22: Before departments for market regulation at the county or districted city level make a decision on entry in the List of the Untrustworthy with Serious Violations, they shall report to the market regulation department at the level above for approval.

Article 23: Where parties are not satisfied with decisions on entry or removal from the List of the Untrustworthy with Serious Violations, they may apply for administrative reconsideration or initiate administrative litigation in accordance with law.

Article 24: Where the market regulation departments receive effective legal documents from the people's courts and need to manage the List of the Untrustworthy with Serious Violations in accordance with laws, administrative regulations, or policy documents of the Party Central Commission and State Council, it is to be implemented with reference to these Measures.

Article 25: These Measures apply to the work of managing the List of the Untrustworthy with Serious Violations by the departments for drug administration and intellectual property rights management.

Article 26: These Measures are to take effect on September 1, 2021. The former Provisional Measures on the Management of the List of Untrustworthy Enterprises with Serious Violations promulgated as State Administration for Industry and Commerce order 83 on December 30, 2015 are simultaneously abolished.