Shanghai Municipal Social Credit Regulations (Draft)

December 31, 2016

Chapter I:General Provisions

Article 1: (Goals and Basis)

These Regulations are made on the basis of relevant laws and administrative regulations, so as to improve the socialist marketplace economic system, innovate social governance systems, raise the level of credit in the entire society, increase awareness of creditworthiness.

Article 2: (Definition)

Social Credit, as used in these Regulations, refers to the status of natural persons with full capacity, legal persons and other organizations' (hereinafter "Information Subjects") compliance with legally prescribed obligations, or performance of contractual obligations, in social and economic activities.

Credit Information as used in these Regulations, refers to objective data and materials that can be used to identify, analyze, and judge the status of Information Subjects compliance with law and performance on agreements.

Article 3: (Scope of Application)

These Regulations apply to activities in the administrative region of this city such as the collection, aggregation, sharing and use of Credit Information; credit incentives and restraints, the protection of Information Subject's rights and interests, and the regulation and development of the credit services industry.

Where laws and administrative regulations provide otherwise, those provisions control.

Article 4: (Governmental Duties)

Municipal and district people's governments shall set up an institution for deliberation and coordination of the establishment of a social credit system, place the establishment of a social credit system within the Citizens' economic and social development plan , and do the overall work of promoting the establishment of a social credit system within that administrative region.

Municipal and district social credit management departments are responsible for the comprehensive coordination and oversight management of social credit efforts, organizing and laying out each policy measure, and taking responsibility for their implementation. Other departments of municipal and district people's governments shall work together to complete social credit work within the scope of their authority.

Article 5: (Collective Social Governance)

All aspects of society are encouraged to participate together in the establishment of social credit, increasing awareness of creditworthiness, strengthening cooperation, and jointly promoting joint rewards and punishments for credit, and carrying forwards a social attitude where the trustworthy are honoured and the untrustworthy are ashamed.

Article 6: Article 6: (Unified Construction)

This city shall carry out each piece of the effort to construct a social credit system, on the basis of the State's overall deployment. Cooperate with the State's relevant departments to compete efforts to establish a national Credit Information sharing platform, improve local Credit Information systems ability to aggregate information, and bring about inter-connectivity and information sharing with the national Credit Information sharing platform; establish mechanisms regional cooperation on credit, promoting Credit Information sharing and mutual recognition of credit appraisals with other provinces, municipalities and autonomous region; and strengthen joint rewards and punishments across regions in key fields, forming a model for regional cooperation.

Chapter II: Credit Information

Article 7: (Types of Credit Information)

Credit Information as used in these Regulations is divided into public Credit Information and market Credit Information.

Public Credit Information refers to data and materials that may be used to identify Information Subjects' credit status, which is produced or acquired by public information providing units such as administrative organs, judicial organs, public enterprises or public institutions, in the performance of their duties or provision of services.

Market Credit Information refers to data and materials that may be used to identify Information Subjects credit situation, which is produced, collected, or acquired by market Credit Information providing units, such as credit service institutions and other forms of enterprises and public institutions, during the course of their production and operations activities.

Article 8: (Disclosure of Public Credit Information)

Where Public Credit Information is within the scope of open government information, all levels of administrative organ shall follow the State and Municipal provisions to publish it through means such as government bulletins, news conferences, websites, periodicals, radio and television; information that is to be disclosed upon application shall be provided in accordance with law through appropriate means such as providing copies or arranging for readings of relevant of materials.

Article 9: (Aggregation of Public Credit Information )

This City implements catalogued management of aggregation of Public Credit Information. The municipal social credit administration department organizes and drafts the city's Public Credit Information catalogue, and when drafting shall solicit comments from the public. The catalogue is to be publicly released once a year upon review and approval by the deliberation and coordination institution, and changes are to be included in the administration of the following years catalogue.

Information Providing Units shall follow the requirements of the catalogue to promptly provide information, and information not included in the catalogue is not to be aggregated on the Shanghai Municipal Public Credit Information Services Platform (Hereinafter Municipal Credit Information Platform).

The specific procedures, standards, and implementation measures for aggregation of Public Credit Information are to be jointly formulated by the municipal social credit administration department and relevant departments, and released to the public.

Article 10: (Special Management of Aggregation)

Where, during the course of drafting the catalogue, Public Credit Information Providing Units find that specific items inclusion in the catalogue would reduce Information Subjects' rights or increase their obligations, and the social impact is quite large, they shall organize expert appraisals together with the municipal social credit administration department, and open it to the public for solicitation of comments.

Article 11: (Municipal Credit Information Platform)

The Municipal Credit Information Platform is the basic platform for the city's establishment of a social credit system, serving as the hub for inter-connectivity of Credit Information, and connecting with the national Credit Information sharing platform and the Credit Information platforms of other provinces, cities, and autonomous region, to complete efforts on Public Credit Information sharing, release, and services.

Article 12: (Market Credit Information records)

Enterprises, public institutions, and so forth, may record Credit Information produced in the course of their own business activities; industry associations and platform enterprises may lawfully record the Credit Information of member enterprises or hosted merchants, as needed for management and services.

Information Subjects are encouraged to use methods such as declarations, voluntary reporting, and social assurances to provide their own information to the Municipal Credit Information Platform, Credit Service Establishments, trade associations, and so forth, and to ensure that the information is lawful, truthful, and complete.

Article 13: (Collection of Market Credit Information)

Credit Service Establishments and other enterprises and public institutions etc, shall follow the principles of truthfulness and objectivity in collecting Market Credit Information in accordance with law. Collection of Market Credit Information must not endanger state secrets, and must not violate commercial secrets or personal privacy.

Credit service establishments and other enterprises and public institutions etc., collection of Market Credit Information that is personal information shall be upon the consent of the natural persons and for agreed upon uses, without the individual's consent, it must not be collected; except where it is open information in accordance with law. The collection of information on individuals' religious faith, genetics, fingerprints, blood type, illnesses or medical history is prohibited, as well as other personal information which laws and administrative regulations prohibit the collection of. Except where Information Subjects have been expressly informed of the negative consequences that might be produced by providing information, and obtaining their written consent, information on person income, savings, negotiable securities, commercial insurance, real property as tax information, must not be collected.

Article 14: (Inter-connectivity of Credit Information)

The municipal social credit administration department shall strengthen communication and coordination with judicial organs, central government units based in Shanghai, and so forth; promote cooperation between the municipal social credit administration department and basic databases of financial Credit Information, and mutual communication and sharing with the city's online government affairs room, enterprise Credit Information announcement systems, satisfying the public's needs.

The city will establish mutual communication and sharing mechanisms for Public Credit Information and Market Credit Information, and encourage all levels of administrative organ to carry out information cooperation with enterprises and public institutions, bringing about the joint application of Public Credit Information and Market Credit Information.

Article 15: (Credit Information Inquiries)

Information subjects have the right to make inquiries into their own Credit Information.

Without the written authorization of the Information Subject, enquiries must not be made into Credit Information that is not made public. Except as otherwise specified by laws and administrative regulations.

Administrative organs and judicial organs may lawfully make enquiries into Credit Information. Administrative organs enquiries into Credit Information shall follow the principle of reasonable administration, and be based on actual needs of administrative management, confirming relevant Credit Information matters in enquiries and making them public.

Article 16: (Services to facilitate the people's enquiries into Credit Information)

The Municipal Credit Information Platform shall draft and release service standards, and set up reasonable Credit Information enquiry portals in the city, to provide convenient enquiry services to the public.

The Municipal Credit Information Platform, Credit Service Establishments, and so forth shall use the internet, cell-phone applications, and so on, to provide convenient Credit Information enquiry services to the public.

The municipal social credit administration department shall strengthen cooperation with relevant departments, to promote the set up of comprehensive enquiry portals, and provide the public with convenient Credit Information enquiry services such as for Public Credit Information and basic financial Credit Information databases.

Article 17: (Credit Information Security Management)

Administrative organs, the Municipal Credit Information Platform, enterprises, public institutions, and so on, shall perform the following Credit Information security management duties:

(1) Establish Credit Information security management mechanisms, and confirming the responsible persons;

(2) Establish standards for the Credit Information enquiry system, clarifying the scope of authority for the unit's personnel and the procedures for enquiries;

(3) Establish information management systems for confidentiality reviews;

(4) Comply with other national and local municipal regulations on information security.

Chapter III: Credit incentives and restraints

Article 18:(Mechanisms for Joint Credit Punishments and Rewards)

The city is to establish mechanisms for joint social credit rewards and punishments, that cross departments, fields, and regions, and is jointly participated in by administrative organs, judicial organs, and market entities; creating a creditworthy atmosphere in which the trustworthy receive benefits and the untrustworthy are restricted.

Article 19: (List of rewards and punishments)

Based on the actual conditions of the city's establishment of social credit, the municipal social credit administration department shall follow the laws, regulations, and relevant national provisions to confirm matters to be jointly rewarded or punished, and draft a list of recommended and compulsory measures. The targets and means of rewards and punishments, the implementing body, the basis in laws and regulations, and other such contents are to be clarified and announced to the public.

Article 20: (Credit Grading)

The city encourages all levels of administrative organ, enterprises, public institutions, and so forth, to distinguish Information Subjects' credit status, and carry out credit grading, as a basis for employing joint reward and punishment measures.

Based on the needs of administrative management work, administrative organs may establish a list of the Seriously Untrustworthy, standardizing procedures and requirements for entry onto the list, and improving mechanisms for remedies and removal from the list; where it is necessary to make it public, the standards, remedy channels, and removal requirements shall be made public.

Industry associations, enterprises, public institutions, and so forth, may refer to the preceding paragraph to establish a list of serious credit violators.

Article 21: (Market Rewards and Punishments)

Market entities are encouraged to consider using Credit Information, credit scores, and credit appraisal results, in carrying out production and business, trade negotiations, and other economic activities.

Based on Information Subjects' credit status, market entities are encouraged to give beneficial facilitation, increased trade opportunities, and other reductions of transactions costs for to trustworthy entities; and to cancel benefits, increase guarantee deposits, and otherwise increase transaction costs for untrustworthy entities.

Financial institutions are encouraged to provide benefits and facilitation in areas such as credit financing, interest rates, methods for repaying debt to trustworthy entities; and financial institutions are encouraged to use risk pricing models to increase interest rates on loans and property insurance rates for untrustworthy entities, or limit the provision of services such as loans, sponsorship, underwriting, or insurance to them.

Article 22: (Industry Rewards and Punishments)

All industry associations in the city shall strengthen the establishment of industry credit management, and industry associations are encouraged to cooperate with Credit Service Establishments to carry out credit grading and classification, and adopt reward measures for trustworthy entities such as key recommendations or raising the rank of members; and adopt punitive measures such as industry warnings, circulation of criticism, reducing membership rank, cancelling membership credentials, for untrustworthy entities.

Article 23: Article 23: (Administrative Credit Enquiries and Product Use)

As necessary for performing their duties, all levels of administrative organ shall make enquiries into Credit Information and use credit products in the follow work:

(1) Implementing administrative permitting, administrative inspections, supervisory sampling, and high-value administrative punishments;

(1) Implementing administrative permitting, administrative inspections, supervisory sampling, and high-value administrative punishments;

(3) management of registration documents, settlement, or acceptance of resident identity card in different places ;

(4) Recruiting state employees, making appointments to posts, or giving promotions;

(5) giving commendations;

(6) other routine management work.

Other state organs, organizations authorized by laws and regulations to have public affairs management duties, and so forth, are to consult the preceding paragraph in making enquiries into Credit Information and using credit products.

Article 24: (Administrative incentives for trustworthiness)

All other conditions being equal, administrative organs may adopt the following incentives for trustworthy entities that comply with legally prescribed obligations and contractual obligations:

(1) Give facilitated services in the course of handling administrative permits, such as priority handling or simplified procedures, on the basis of actual conditions;

(2) Make trustworthy entities priority choices for public financing and project support;

(3) Measures such as adding credit points in public resource transactions;

(4) Optimize random sampling inspections and inspection frequencies in routine supervision for enterprises that meet certain conditions,

(5) Other incentives that may be lawfully employed in accordance with laws and regulations.

Article 25: (Administrative Penalties for Untrustworthiness)

Administrative organs may employ the following punitive measures against untrustworthy entities that breach legally prescribed or contractual obligations:

(1) List them as subjects for key examination in administrative permitting, and don't apply simplified approval procedures such as information and assurances;

(2) limit financial assistance and other such policy support;

(3) Cancel facilitation measures already enjoyed in administrative management;

(4) Employ credit point reduction and other measures in public resource transactions;

(5) list them as key management targets in routine management, and increase the frequency of monitoring, and strengthen on-site examinations;

(6) Other punitive measures that the State and city provide may be employed.

Article 26: (Range of Special Penalties)

Where Information Subjects exhibit the following conduct, the judicial and administrative organs may employ special punitive measures.

(1) Acts that seriously hurt the public's physical health, or security in their lives, in areas such as food and drug safety, ecology and environment, project quality, safe production, and fire safety;

(2) Bribery, tax evasion, tax fraud, malicious debt evasion, assembling to disrupt social order, and other such conduct that seriously undermines the order or fair market competition and ordinary social order;

(3) After judicial or administrative organs make a judgment or decision, refusing to perform on it despite being able to, evading the enforcement of legally prescribed obligations and seriously impacting the credibility of the judicial or administrative organ;

(4) Acts of refusal to perform national defense obligations, such as refusing or avoiding military service, refusing or delaying the expropriation of civil-use resources or impeding the modification of expropriated civil-use resources, endangering national defense interests or destroying national defense facilities;

(5) Other acts of serious untrustworthiness that the State and city provide.

Article 27: ( Special Punitive Measures)

For Information Subjects exhibiting any of the conduct provided in article 26, the judicial and administrative organs may employ the following punitive measures in accordance with laws and administrative regulations:

(1) Prohibiting entry to markets and industries;

(2) limiting public resource transactions;

(3) Limiting Infrastructure and Public Utility Concessions

(4) limiting financial activities;

(5) Limits on high-spending and related consumption;

(6) Restrictions on enjoyment of public policies;

(7) the revocation of honours;

(8) restricting qualifications for positions;

(9) Other special punitive measures provided by law or administrative regulations.

Where judicial and administrative organs adopt the special punitive measures of the preceding paragraph against Information Subjects, they shall give information on the basis and reasons for the implementation.

Article 28: (Linkage between legal persons' and natural persons' information on untrustworthiness)

A link shall be be made between the personal Credit Information of the legally-designated representative, principle responsible person, and other directly responsible personnel of enterprises, public institutions, and other organizations with seriously untrustworthy conduct, and the Credit Information of that unit; and relevant departments may lawfully take joint disciplinary actions against the relevant responsible persons when joint disciplinary action is taken against the unit.

Chapter IV: Protection of Information Subjects' Rights and Interests

Article 29: (Right to Know)

Information Subjects have the right to know about conditions such as the collection and use of their own Credit Information, as well as the sources of information contained in their own credit reports, and the reasons for any changes.

Natural persons have the right to freely obtain their personal credit report twice a year, and the personal credit report credit shall indicate the uses of Credit Information and enquiries into the information, except as otherwise provided by laws and regulations.

Credit Service Establishments must not tie the collection of personal Credit Information to other services, or coerce or indirectly coerce Information Subjects' consent.

Article 30: (Right to remove records)

The period for enquiries into information on Information Subjects' untrustworthiness is 5 years; calculated from the day on which the untrustworthy conduct or incident concludes; except as otherwise provided by laws and regulations.

Information on untrustworthiness beyond the period for enquiries is no longer provided and must not be used or appraised.

Article 31: (The right to object)

Where the Information Subject finds that there was error, omissions, or violations of privacy, commercial secrets or other lawful rights and interests in the collection, storage, or provision of Credit Information, they may submit objections to the Municipal Credit Information Platform, Credit Service Establishments, and so forth.

Credit Service Establishments shall lawfully reach a disposition within 7 business days of receiving an objection request, and promptly inform the objecting applicant of the disposition results.

After the Municipal Credit Information Platform receives an objection application, it shall reach a disposition within 5 business days of receiving those that are within the range of corrections it makes; and shall transfer those that are within the range of corrections made by Credit Information Providing Units to the Credit Information providing unit within two business days of receiving them. Information Providing Units shall make a disposition in accordance with law within 5 business days, and the Municipal Credit Information Platform shall promptly inform the objecting applicant of the disposition results.

Article 32: (Active Credit Restoration)

Where during the period for valid enquiries into information on untrustworthiness, Information Subjects' actively corrects the untrustworthy conduct and eliminates the negative impact, and the unit that provided the information on untrustworthiness issues a written proof of credit record restoration, the Municipal Credit Information Platform shall delete the information on untrustworthiness from the platform interface.

Article 26: Providing conduct that does not apply the preceding paragraph.

Where administrative punishment information is revoked through remedial procedures, the unit that originally provided the information on untrustworthiness shall promptly issue proofs, and the Municipal Credit Information Platform is to delete that information from the database.

Chapter V: Regulating and Advancing the Development of the Credit Services Industry

Article 33: (Regulating and Supporting the development of Credit Service Establishments)

Municipal Government departments shall formulate relevant policies, norms and support for developing Credit Service Establishments, support credit services organizations' active participation in international cooperation, and strengthen the influence of Credit Service Establishments.

Credit Service Establishments' sorting, storage, and processing of information collected in the mainland shall be done in the mainland; provision of information to foreign [non-mainland] organizations or individuals shall comply with provisions of laws and administrative regulations.

The special fund set up by the city for the establishment of a social credit system shall support the development of the credit services industry.

Article 34: (Business Compliance)

Credit Service Establishments gathering and handling of Credit Information, and provision of credit products, shall follow the principles of objectivity, fairness, and prudence; lawfully accepting government oversight.

Credit Service Establishments have an obligation to keep the confidentiality of state secrets, commercial secrets and personal private information obtained in the course of operations; must not prejudice national security, public safety, and the public interest; and must not harm the lawful rights and interests of Information Subjects.

Article 35: (Model guidance)

Where any level of administrative organ uses credit reports in government procurement, bidding and tendering, financial support, personnel management, project management, and other such areas, the related charges must not born by the subject of the report.

The city encourages leading Credit Service Establishments to participate in credit management in the management of key industries, to provide basic Credit Information enquiry and verification services for the establishment, filing, and access qualifications for industry Credit Information archives; and provide industry credit status monitoring reports.

Article 36: (The development and application of Credit Products)

The city supports Credit Service Establishments use of big data and other techniques to develop credit products with independent intellectual property rights, expanding the field, and satisfying the needs of societal and administrative applications.

The city encourages innovation demonstration zones and industrial parks to introduce Credit Service Establishments to provide customized credit products and services for them

Article 37: (Industry Self-regulation)

Credit industry associations shall strengthen industry self-discipline and management, organizing the drafting and promoting implementation of industry norms, formulating industry statistical reports, developing publicity trainings, policy recommendations, and industry information publications, and elevating the capacity and credibility of industry services.

Article 38: (Training of Credit Professionals)

The city supports universities and schools of higher learning to establish curricula for credit management majors, cultivating credit service professionals; and supports Credit Service Establishments bringing in high-level foreign and domestic credit service personnel.

Chapter VI:The Establishment of a Credit Environment

Article 39:(Government integrity and faith in the judiciary)

All levels of administrative and judicial organs shall strengthen their own credit establishment while establishing social credit, and drive the establishment of creditworthiness awareness and an increase the level of creditworthiness for the whole society.

All levels of administrative organ shall improve systems for the operation, restraint and supervision or power, improving decision-making mechanisms and procedures, increasing transparency in decision-making; strictly honouring policy promises made to society in accordance with law, earnestly performing on contracts signed in accordance with law. Performance on promises to handle matters for the people in the citizens' economic and social development plan, government work reports shall be an important part of appraising the level of government creditworthiness.

All levels of judicial organ shall raise the level of rationality, systematization, and regulation in judicial work; advancing judicial openness, a strictly just judiciary, and protecting fairness and justice.

Article 40: (state employee credit models)

State employees of the city shall lead the way in handling matters in accordance with law, in creditworthiness and trustworthiness, and be a good models in establishing social credit.

All levels of state organ shall strengthen education on creditworthiness for that unit's personnel, and establish credit archives for state organ personnel.

Article 41: (Spreading Education on Creditworthiness)

The city shall draft a creditworthiness education plan, and develop education on social morals, professional ethics, family virtues and individual morals.

Departments of education shall integrate the ideological education curricula for students, organizing the writing of educational materials on creditworthiness suited for the characteristics of students of different ages, and carry out creditworthiness education for students.

Article 42: (Promoting a Culture of Creditworthiness)

The city's relevant departments shall combine the selection of spiritual models of civility and morality with each industries activities in creating creditworthiness, with establishing paragons of creditworthy, promoting the traditional culture and modern spirit of creditworthiness and trustworthiness.

Media of all kinds are encouraged to publicize examples of creditworthiness, and to report and disclose all kinds of untrustworthy conduct and incidents.

The City newspapers, broadcasts, television, and other media shall add publicity on creditworthiness and trustworthiness to public interest advertisements.

Chapter VII:Legal Responsibility

Article 43: (Guidance Provisions)

Where violations of prohibitions in these Regulations is already provided for in laws and regulations, those provisions control.

Article 44: (Administrative Responsibility)

Where administrative organs, and enterprises and public institutions authorized by laws and regulations with public management duties, as well as their employees, violate these Regulations by abusing their authority, dereliction their duties, or twisting the law for personal gain in the course of Credit Information collection, use, or in the implementation of reward and discipline measures and so forth; their unit or the competent department at the level above are to give administrative sanctions to the directly responsible managers and other directly responsible personnel, based on the seriousness.

Article 45: ("talkings-to")

Where administrative organs and their staffs fail to perform on the provisions in Articles 9, 10, 15, and 31 such as on management of the catalogue of Public Credit Information, enquiries, and handling of complaints, the competent department above or the municipal social credit administration department is to give them a talking to, and on the basis of the seriousness order that corrections be made, give warnings, or circulate criticism.

Article 46: (Punishment for unlawful collection)

Where Credit Service Establishments and other enterprises, public institutions, and so forth, violate the provisions of Article 13 of these Regulations, by collecting Information Subjects' information without consent, or illegally collecting Information Subjects' information, the municipal social credit administration department is to order corrections be made within a fixed time, and may give fines of between 10,000 and 100,000 RMB; and where the circumstances are serious, a fine of between 100,000 and 500,000 RMB is to be given.

Article 47:(Punishment for providing enquiries in violation of rules)

Where the Municipal Credit Information Platform or Credit Service Establishments violate the provisions of Article 15 of these Regulations by failing to complete review obligations, or providing enquiries to outsiders in violation of rules; the municipal social credit administration department shall give a fin of between 10,000 yuan and 100,000 RMB.

Article 48: (Punishment for violations of information security provisions)

Where administrative organs, the Municipal Credit Information Platform, enterprises, public institutions, and so forth violate article 17 of these Regulations by failing to perform Credit Information security management duties, the competent department for information security is to order corrections be made within a set time, and give punishments in the accordance with relevant management provisions.

Article 49: (Punishments for violations of provisions on objections)

Where the municipal social credit administration department or Credit Service Establishments violate article 31 of these provisions by not following provisions to handling complaint applications from Information Subjects, the municipal social credit administration department is to order corrections be made within a set time, and where corrections are refused, may give a fine of between 10,000, and 50,000 RMB.

Article 50: (Civil Liability)

Where the Municipal Credit Information Platform, enterprises, public institutions, and so forth, violate the lawful rights and interests of Information Subjects while collecting, aggregating, or using Credit Information, causing losses, they shall bear corresponding civil liability to make compensation.

Article 51: (Criminal Responsibility)

Where relevant State provisions are violated by illegally obtaining, stealing, providing, or selling personal credit information, constituting a violation of public security management, public security administrative sanctions are given in accordance with law; and where circumstances are serious and a crime is constituted, criminal responsibility is pursued in accordance with law.

Chapter VIII: Supplementary Provisions

Article 52: (Glossary)

"Credit Service Establishments" as used in these Regulations refers to intermediary service institutions that are lawfully established and provided credit products as well as engaging in credit enquiry, credit risk control, and other business activities related to credit.

"Platform enterprises" as used in these Regulations refers to enterprises based in the internet, cloud computing or other modern information technology that provide platforms to put together bilateral or multilateral transactions, that have the characteristic of producing or storing large volumes of Market Credit Information.

Article 53:(Drafting of Implementation Rules)

The municipal people's governments may draft specific implementation measures on the basis of the relevant provisions of these Regulations.

The work departments of district and municipal people's governments may combine the actual circumstances of the department or region to draft specific implementation measures.

Article 54: (Implementation Period)

These regulations take effect on ______.