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Social Credit Joint-Enforcement MOU breakdown (BETA)

The tools that follow the brief introduction are a comprehensive, interactive, and understandable guide to the main mechanism of China’s Social Credit System. It provides a sortable guide to all joint enforcement punishments in the system.

The primary mechanism of the ‘Social Credit System’ is one of administrative regulation: government agencies sign targeted ‘joint enforcement’ MOUs agreeing to take limited ‘joint enforcement’ action against organizations and individuals ‘blacklisted’ (or ‘redlisted’) by certain other agencies.

For example, if someone is blacklisted by the Food and Drug Administration for a major health violation at their snack food factory, the agency for securities regulation might use this as a basis to reject their application to operate a securities company.

Being blacklisted by an agency, and thus within the scope of joint enforcement, is not based on an algorithm or meta-analysis of data, but is a consequence of specific violations of laws and legal obligations.

Despite its name, Social Credit is more similar to a criminal record system than to a credit report of any kind: It adds secondary penalties and enforcement mechanisms against those who have violated laws or failed to perform legal obligations, rather than directly imposing new obligations.

The data gathered here is government-created information; primarily administrative permits, administrative punishments, and court rulings.

Each joint enforcement MOU focuses on a limited group of serious offenders within a regulatory sector. The first mini-table below allows you to view the basis for inclusion in each MOU, listed by the professional sector.

NOTE:

  • Some MOUs define their targets only by referencing blacklist designations created elsewhere by a certain regulatory body in accordance with separately published rules, while others provide detailed criteria in the MOU itself.
  • The targets are primarily businesses, not individuals, but, certain stakeholders and employees of the business may be included for punishments and rewards as well.

Mini-table: Targets of Joint Enforcement

MOUTargets
Pick an MOU Subject

To learn who it targets

No-Fly List

Given an administrative or criminal penalty for the following acts in airports or aboard planes: (1 Year Ban)

  1. Intentionally spreading or creating fake terrorist threats;
  2. Using fake or altered ID documents or flight documents, or impersonating another person to board;
  3. Obstructing or attacking check-in counters, security check channels, or boarding gates.
  4. Carrying on or checking contraband, or intentionally concealing items that are legal, but prohibited by airline rules;
  5. Forcibly boarding aircraft, or charging or attacking the cockpit, runway etc.;
  6. Obstructing aviation personnel (flight crew, security, check-in, etc.) in the performance of their duties, threatening to harm them, or inciting others to do so;
  7. Forcefully occupying a seat or luggage rack, fighting or brawling, activating aircraft equipment, otherwise disturbing order;
  8. Use open flame, smoking aboard an aircraft, or using electronics in violation of rules, and refusing to stop when told; or
  9. Stealing on board a plane.

As penalty for violations in other areas (removed if obligation met, or at end of one-year)

  1. Parties in major tax cases that have the ability to perform but refuse to do so;
  2. Persons responsible for seriously untrustworthy conduct in the field of government finance capital management and use, that have situations of falsification, making false representations and claims, defrauding assets, withholding or misappropriation, or being in arrears on matured debts to international finance organizations or foreign governments;
  3. Seriously untrustworthy conduct that have the following circumstances in the field of social insurance:
    1. Employers not participating in social insurance system after being warned,
    2. Employers not truthfully reporting social insurance payments basis,
    3. Employers with the ability to make contributions refusing to do so,
    4. Those who conceal, take, or use social insurance funds illegally;
    5. Those who fraudulently claim benefits
    6. Social insurance service institutions violating service agreements
    7. Those refusing to assist social insurance administrative bodies in the investigation of accidents.
  4. Where fines imposed in the securities sector have not been timely paid, or where publicly listed companies have not performed public commitments in the time allowed.
  5. Those against whom the courts have imposed spending restrictions, or entered on the Judgment Defaulter List.
  6. Others lawfully restricted from flying.

No-Train List

Given an administrative or criminal penalty for the following acts in train stations or aboard trains: (Banned from any trains )

  1. Disrupting order and endangering public safety, causing a negative impact;
  2. Smoking on trains where prohibited;
  3. Scalping tickets, or making or selling fake tickets;
  4. Using fake documents to receive discounted tickets;
  5. Using invalid tickets;
  6. Riding without a ticket, or travelling further/ upgrading seats, without supplementing the fair;
  7. Other situations receiving punishment..

As penalty for violations in other areas:

( restrictions from riding high-speed trains, and first class seats on any train; removed if obligation met, or at end of one-year)

  1. Parties in major tax cases that have the ability to perform but refuse to do so;
  2. Persons responsible for seriously untrustworthy conduct in the field of government finance capital management and use, that have situations of falsification, making false representations and claims, defrauding assets, withholding or misappropriation, or being in arrears on matured debts to international finance organizations or foreign governments;
  3. Seriously untrustworthy conduct that have the following circumstances in the field of social insurance:
    1. Employers not participating in social insurance system after being warned,
    2. Employers not truthfully reporting social insurance payments basis,
    3. Employers with the ability to make contributions refusing to do so,
    4. Those who conceal, take, or use social insurance funds illegally;
    5. Those who fraudulently claim benefits
    6. Social insurance service institutions violating service agreements
    7. Those refusing to assist social insurance administrative bodies in the investigation of accidents.
  4. Where fines imposed in the securities sector have not been timely paid, or where publicly listed companies have not performed public commitments in the time allowed.
  5. Those against whom the courts have imposed spending restrictions, or entered on the Judgment Defaulter List.
  6. Others lawfully restricted from flying.
A-level credit tax payersAnnounced A-level credit taxpayers
AccountingAccounting personnel with serious violations of laws as identified by Ministry Of Finance or other relevant department (e.g. Accounting Law","Company Law", or "Securities Law", )
Agricultural sector

Enterprises with serious untrustworthy conduct in agricultural production and operations,

  • Their legal representatives, principle responsible persons, and management with direct responsibility for the conduct.

Serious untrustworthy conduct is defined in a blacklist document as:

  1. Violation of regulations by producing and selling agricultural products such as pesticides, veterinary drugs, feed and feed additives for which production, sale and use are prohibited.
  2. Producing fake and shoddy agricultural products and causing losses of more than 20,000 yuan to agricultural production.
  3. Having relevant qualification documents revoked by the agriculture departments because they were obtained by fraud, bribery, concealing information, providing false materials and other improper means; or forging or altering relevant qualification documents.
  4. Having agricultural production licenses, business licenses, product registration certificates and other qualification documents revoked.
  5. Illegal producing agricultural products without obtaining a license for agricultural production and operation.
  6. Other serious acts of untrustworthiness
Bidding and tenderingBidders, tender agents, bid appraisal experts, and others engaged in bidding and tendering when identified as judgment defaulters by the people's courts
Charity Punishments
  1. Organizations listed by the Ministry of Civil Affairs as having serious violations

  2. Legal representatives and directly responsible persons in charge of above.

  3. Donors found by courts to be responsible for violations.

  4. Beneficiaries found by courts to be responsible for violations.

  5. Natural persons, legal persons, or other groups, that have been found by police to be posing as a charity.

Charity Rewards
  1. 4A rated charities, or

  2. Donors with good records or special help in poverty alleviation;

    With no negative record

Court Judgment Defaulters

Judgment defaulters announced by the Supreme People's Court (including natural persons and entities):

  • Have an active enforcement judgment against them
  • Have capacity to perform, but refuse to do so
Cultural Market

Market entities engaged in commercial performances, entertainment venues, art works, Internet Access services, internet culture etc. that are

  • Blacklisted for serious violations; and
  • Given administrative punishments for relevant violations or for engaging in cultural market activity without permits that :
    1. Cause accidents or vile impact
    2. Have permits revoked
    3. Have permits revoked because improperly obtained or altered
    4. Other situations provided by law
Customs
  • Enterprises designated untrustworthy by customs on the basis of the "P.R.C. Temporary Measures on Management of Enterprises' Customs Credit

  • their legal representatives (responsible parties), directors, supervisors, and senior management.

Domestic Services

Untrustworthy Domestic service businesses identified by competent departments for violating relevant laws.

  • Their legal reps, principle responsible persons, and directly responsible personnel.

The cited industry documents prohibit the following conduct:

  1. Engaging in unfair competition by offering below cost prices or raising prices.
  2. Not providing services according to the service contract.
  3. Instructing domestic workers to drive up prices or intentionally breaking contracts to fraudulently obtain service fees.
  4. Publishing false advertisements or concealing true information to mislead consumers.
  5. Using domestic services to forcibly promote goods to consumers
  6. Seizing or withholding wages from workers, charging high management fees, or engaging in other acts that violate the rights and interests of workers.
  7. Seizing workers’ original ID cards, diplomas, qualification certificates, and other such documents.
  8. Committing other acts prohibited by laws and regulations.
Domestic trade
  • Market entities in domestic trade flow fields such as wholesale and retail, trade and logistics, or accommodations, food services and residential services;

  • that violate the relevant laws, regulations, rules and regulatory documents; go against the principle of good faith and credit,

  • As designated by the relevant competent departments as having serious unlawful untrustworthy conduct.

    And:

    • Where the entity is an enterprise the targets of joint punishment are enterprises, their legal representatives, principle responsible parties, and personnel with direct responsibility;
    • where the entity is another economic or industry organization, the targets of joint punishment are the responsible party for the organization and the personnel with direct responsibility;
    • where the entity is a natural person, the targets of a joint punishment are the natural persons themselves.
Electricity
  1. power generating companies, electric grid enterprises, trade bodies, dispatching bodies, enterprises selling power, and electricity users that participate in electricity market transactions

    1. includes legal representatives, shareholders, and other persons.
  2. Announced by NDRC as having violated laws and being placed on blacklist;

Electronic Authenification Services Rewards

Verification service establishments identified and published by MIIT as obeying laws and regulations (electronic signature law), following e-verification operation rules, having positive service record, higher credit appraisal level, and no negative record.

Electronic Authenification Services Punishments

Verification service establishments designated by MIIT as:

  • not complying with laws, regulations or operational rules and harming consumer rights, or
  • businesses, public institutions, etc. operating as e-verification bodies without permits.
Entry Exit Rewards

AA-level inspection quarantine credit, designated by Quality Inspection Administration:
which is based on legal compliance, usefulness as role-models, social responsibility, etc.
no negative history

Entry Exit Punishments

Designated by the Quality Inspection Administration as having serious illegal untrustworthy conduct

Environmental Protection
  1. Businesses with serious untrustworthy conduct in the field as designated by Ministry of Environmental Protection

  2. their legal representatives, principle responsible parties, and personnel with direct responsibility

Finance

Those on list of seriously untrustworthy involving finances:

    • If entity then also legal representative, actual controller, and directors or supervisors and senior management with responsibility.
    • If social organization then also legal representative and responsible staff
    • If natural person, the person themselves

Entry on that list is defined in an industry document as

  1. Maliciously avoiding payment of debts, such as not paying despite having the ability to pay.
  2. Fraud in which one party intentionally provides false information, conceals the real situation, or uses other fraudulent means to obtain the other party's property.
  3. Engaging in illegal fund-raising or illegal securities and futures activities.
  4. Other acts involving financial crimes that are pursued for criminal responsibility and acts that are subject to severe administrative penalties for violating financial supervision regulations.
Food Safety

Food producers and traders identified by FDA as having serious untrustworthy conduct.

  • If company, then legal representative, and directly responsible people,
  • If economic organization, then responsible party;
  • If natural person, the person themself
Foreign econcomic cooperation

Entities listed by competent departments as having serious untrustworthy conduct, such as violating domestic or relevant foreign law, losing face,

  • Includes the entity and responsible individuals.
Government Procurement
  • Suppliers and representative bodies, and their responsible staff

  • OR assessment experts.

  • Designated by departments as violating procurement law and others laws

High-grade Customs Certification

Those issues a high-grade customs enterprise certificate

Insurance

1. All types of insurance establishment, insurance practitioners, and other establishments and persons involved in insurance market activities,

2. who have been lawfully found by the departments for oversight and management of insurance as having serious illegal untrustworthy conduct

IP (Patent)
  • Those with serious untrustworthy conduct in IP (Patent Field),

    • where entity is an company, the legal representative, responsible party, and directly responsible personnel,
    • where organization, the responsible party and org,
    • where natural person, the natural person
  • Including:

    1. Repeated patent violations: repeat infringement of same rights after initial finding of infringement.
    2. Refusing to act on administrative decisions about patent infringement, or obstructing investigations
    3. Serious illegal conduct in patent representation: failure to comply with relevant provisions 3 years after being entered onto list of abnormal operations.
    4. Letting others use patent agent credentials.
Major Tax

Listed as parties in major tax case information published by tax authorities.

  • If natural persons, only those persons
  • If companies the enterprise and legal representatives, and responsible finance personal;
  • If other economic organization, the responsible party and financial personnel
  • If intermediary the responsible party and relevant practitioners.
Marriage Fraud

Untrustworthy parties to marriage registration as identified by civil affairs departments:

  1. Using fake, modified, or borrowed proofs showing one is not married
  2. Making false statements about marital status, or about blood relatives (rlvnt to marriage law).
  3. Concealing incapacity of the other party to the marriage, harming their interests
  4. Other serious violations of the Marriage Law or registration regulations
Medical disruptions

Natural persons who have been given administrative or criminal penalties for disrupting medical activity; such as:

  1. Scalping hospital visit numbers
  2. Intentionally harming medical personnel or destroying public or private assets in a medical establishment;
  3. disturbing the order of medical treatment;
  4. Illegally restricting medical personnel's physical liberty;
  5. Berating or intimidating medical personnel;
  6. Entering a medical establishment while illegally in possession of a firearm, munitions, controlled weapons, or hazardous materials;
  7. Inciting others or being retained by others to act on their behalf, to carry out illegal or criminal conduct involving medical care.
Migrant Worker Salary Arrears

Companies listed by Human Resources and Social Security Departments as having salary arrears,

their legal representatives, primary responsible party, and directly responsible persons.

Natural Gas
  1. Involved in exploration and development, storage and transport, processing and refining, wholesale and retail, import or export of oil or natural gas; AND

  2. Have broken laws and been entered on industry list of untrustworthy.

  • If company, then legal representative, and directly responsible people,
  • If economic organization, then responsible party;
  • If natural person, the person themselves
Overloaded Transport
  • Freight sources and road transport units reported by the MOT as having serious violations of laws regulations or rules on overloading, And their legal representatives, and directly responsible persons, freight vehicle drivers, and vehicles.

  • Serious violations of laws and regulations are defined elsewhere as:

    1. Transport vehicles illegally overload 3 or more times in 1 year.
    2. Drivers of transport vehicles who illegally overload 3 or more times in 1 year.
    3. Transportation companies suspended by transportation authorities with more than 10% of their vehicles having overloaded in the past year.
    4. Vehicle maintenance operations that modify vehicles without authorization and have their businesses licenses revoked under serious circumstances.
    5. Ordering or forcing drivers to overload, and having been fined 20,000 yuan or more by the transportation authorities, or having more than 3 administrative punishments in 1 year.
    6. Concealing information or providing false materials when applying for an administrative license for overloaded transport, or obtaining an administrative license by cheating, bribery or other improper means.
    7. Drivers, source units, and large transport enterprises involved with overloading vehicles that refuse supervision and inspection of the relevant departments or provide false information.
    8. Having received administrative punishments by the police for blocking traffic, running checkpoints, violently resisting the law, or damaging relevant facilities and equipment.
    9. Having major accidents due to illegal overloading.
    10. Committing violent disobedience of the law resulting in death or injury.
Product Quality
  • Enterprises that violate relevant laws and regulations, as provided by the State Quality Inspection Admin

    • the legal representatives of the above

Public resources

Enterprises that have been punished for the violations listed below: their legal reps, natural person shareholders, evaluation experts, and other responsible persons.

(Includes: Tenderees, purchasers, bidders, suppliers, bidding agents, purchasing agents, and appraisal experts)

  1. not holding bidding where required, or otherwise avoiding bidding
  2. Bidding agents that disclose confidential information or colluding with bidders or tenderees
  3. Tenderees blocking bidders, discriminating, forcing joint bids, restricting competition
  4. Tenderees disclosing the names, or info on potential bidders, or bid estimates where bidding is mandatory
  5. Bidders colluding with other bidders or tenderees, or giving bribes;
  6. Bidders using others names or other misinformation
  7. Tenderee illegally negotiating with bidders on bid content where bidding is mandatory
  8. Bid Appraisal committee members accepting bribes, leaking deliberation material, etc.
  9. Tenderees accepting bids against the appraisal committee's recommendation
  10. Bid winners transferring project or parts of it, illegally subcontracting, or subcontracts subcontracts
  11. Tenderees and bid winners not contracting in accordance with accepted bid, or signing non-compliant contracts
  12. Bid winners not following the contract in doing work
  13. Purchasers or agents not conducting bidding, increasing standards, discriminating against suppliers, negotiating with bidders, not signing a contract reflecting bidding, or resisting supervision
  14. Purchasers or agents colluding with suppliers, accepting bribes (etc.), providing fake information to oversight, disclosing bid estimates, etc.
  15. Purchasers not centralizing purchasing as required by law
  16. Purchasers or agents hiding, destroying, faking, altering, or purchasing documents
  17. Suppliers providing false materials, unfairly competing, colluding with purchasers, suppliers, or agents, bribing or negotiating with purchasers, or resisting oversight
  18. Vaccine producers selling type-2 vaccines to non-CDC units
  19. Other acts in violations of relevant law,
Publicly traded companies

Entities such as public companies and related establishments or individuals that have been given administrative punishments or market entry prohibitions by the China Securities Regulatory Commission and its remote bodies, including:

  1. Public companies;
  2. Personnel such as directors, supervisors, and senior management of public companies;
  3. Controlling shareholders, actual controllers, and shareholders with more than 5% control, as well as their directors, supervisors, senior management, and other responsible personnel;
  4. The buyers of public companies, and all parties to major asset reorganizations of public companies or purchases of assets through the issuance of shares (including those acting in concert) and their directors, supervisors, senior management and other such responsible personnel.
Realty
  • Developers, intermediaries, or property management companies with untrustworthy conduct,

    • their legal representatives, responsible parties, and directly responsible practitioners.

Salt Industy
  • Producers or sellers of any salts identified as untrustworthy by State Council relevant bodies.

    • where company, the legal rep and directly responsible personnel;

    • where other economic org, the responsible person;

    • Where a natural person, the person themselves

Scientific research

Those on Science Blacklist (serious untrustworthiness list) including:

  • Program or project officers, project evaluators, expert reviewers; research service staff, award candidates, recipients, nominators, and other people;
  • Entities such as those doing projects, managing projects, intermediary service bodies, academic societies, nominators for awards.
Social Insurance

Companies or public institutions and their personnel designated by MHRSS, SAT, or Medical Insurance bureau as having violated relevant laws or regulations primarily including:

  1. Employers not participating in social security, and not correcting when warned
  2. Employers not truthfully reporting social security payments, and not correcting when warned
  3. Refusals to make payments
  4. Hiding or disposing of SS fees or funds
  5. Obtaining Benefits by Fraud
  6. illegally obtaining, selling, or exchanging personal data on SS rights
  7. Service establishments breach of agreements or rules
  8. refusing to assist in government enforcement or investigations
Statistics - Revised

Legal entities or individuals identified by statistics departments who

  1. faked data in government statistics;
  2. provided fake data on critical amounts;
  3. were dishonest in reports and materials given to oversight bodies;
  4. obstructed statistical investigations (w/ serious circumstances); or
  5. disposed of original records, statistical parameters, survey forms etc.
Tourism Field
  • Travel Agents, Scenic Destinations, providers of accommodations etc.

  • Blacklisted by Ministry of Culture and Tourism, where:

    1. received administrative violation for violation of tourists' rights
    2. Responsible for a major safety incident
    3. Found by court to be responsible for tort or contract harm to tourist interests (or are a judgment defaulter)
    4. The primary responsible party for tourism business that has been given a criminal penalty related to violating tourist rights
    5. Persons working in tourism who disrupt public transit, damage public facilities, damage cultural relics, or violate norms at destinations, and are given an administrative punishment or found guilty by a court.
    6. business and persons that violate tourists interests causing serious negative societal impact.
    7. Other violations of laws and regulations
Transport and logistics

1. Companies and sole proprietorships involved in ransport, warehousing, distribution, agency, packaging, circulation processing, delivery, and information services etc.

2. That have broken laws and put on blacklist by gov. departments.

  • Includes legal representativess, responsible parties, owners of trucks, and others.
Transport ConstructionIdentified by MOT, no negative records; entities only
Youth Volunteers
  • 5a-rated youth volunteers (top 5%) with no negative history for three years.

    • 5A determinations are based on duration and frequency of volunteer work.

Rewards and Punishments

The MOUs allow punishments only for violations of law. These secondary punishments, beyond the normal administrative or criminal punishments that led to blacklisting, generally include tighter administrative oversight, restrictions on professional certifications, reduced access to government lending or grants, and restricted participation in bidding on government project work or purchasing. They are usually imposed for a limited period of time, but some extreme violations can have lifetime consequences.

The tables below have broken down all existing national-level MOUs, to show specific punishment or reward measures for inclusion on each MOU. Using the tables, you are able to filter the joint enforcement measures by multiple fields, to fully understand the impact of the MOUs and each department’s role in the system.

Example:

Each row of a table addresses a specific penalty (or reward) found in a joint enforcement MOU:

  1. The initial SOURCE MOU column indicates which MOU contains the specific punishment listed in that row, and thus what sector the misconduct occurred in.
    1. Here, ‘Tourism Sector’ indicates the “Memorandum of Cooperation on Joint Punishment of Entities with Responsibility for Serious Untrustworthiness in the Tourism Field"
    2. You can learn who is impacted by an MOU and specific penalty by looking to the Mini-table: Targets of Joint-Enforcement above.
    3. You can also limit searches to specific MOUs using the filters above the table.
  2. The SUBCATEGORY column refers to an internal division in the MOU, provided as a reference.
  3. The PENALTY PROVISION column contains the actual text of the enforcement measure taken from the indicated MOU.
  4. The IMPLEMENTING BODY column lists all government bodies involved with enforcing the penalty. Because each body has a limited scope of authority, this column also helps clarify the scope of the punishment.
  5. While not displayed, a final PUNISHMENT CATEGORY column can also be used as a filter, organizing the punishments by general punishment type.

You Can Use the Filters at the Top of the Table to Single Out Specific Situations

So, for example,if you wanted to understand what punishments the Securities Regulatory Commission has agreed to take against violators of food safety provisions, you would select “Securities and Regulatory Commission” as the IMPLEMENTING Body and “Food and Drug Safety” as the SOURCE MOU.

 

WARNING: SEARCHING IN ENGLISH WILL ONLY WORK IF YOU HAVE THE LANGUAGE SET TO ENGLISH

Interactive Table 1: Social Credit Punishments

Click the button to pull up the tool in Full Screen.

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Interactive Table 2: Social Credit Rewards

Redlists are concerned with rewards rather than punishments. Entities and individuals on these lists have no negative record and have been nominated by a social organization or government body as a model of compliance. The benefits of being red-listed tend to be special consideration in the selection for awards, lower levels of scrutiny in applications for permits and credentials, and other facilitation services.

Some Social Credit MOUs allow for joint rewards of redlisted individuals. You can explore these by clicking here:

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