Law takes graft fight to private companies

Revised legislation better protects legitimate rights of entrepreneurs

Chinese prosecutors and judges have pledged to strengthen the fight against corruption in private firms in line with a newly revised law, so that the legitimate rights and interests of entrepreneurs can be strongly protected.

“Prosecutors have been told to strictly implement the amended Criminal Law to increase punishments for corrupt behaviors such as embezzlement and misappropriation of funds by those working for private companies to ensure the healthy development of the enterprises,” said Gao Jingfeng, an official from the Supreme People’s Procuratorate.

He said people who damage the trade secrets, trademarks and copyrights of private enterprises, or affect their innovation will also be harshly punished.

With the new amendment to the Criminal Law extending a few other criminal charges that used to apply to State-owned employees to personnel of private firms, “our combat against those offenses will also be intensified”, Gao added.

The charges include illegally making profits for friends or relatives, discounting stocks at low prices and selling assets of the enterprise, according to the revised law, which is now in effect.

“The expansion aims to prevent employees of private firms from taking illegal measures to damage the companies’ interests, with stronger protection for entrepreneurs,” said Xu Yong’an, an official from the Standing Committee of the National People’s Congress, the country’s top legislature.

He said the revisions provided a legal basis for private companies to fight corruption, adding that optimizing anti-corruption measures is crucial because corrupt acts have been seen more frequently in private companies, and a number of national lawmakers and political advisers had suggested action.

Gao welcomed the amended law, saying the number of criminal cases involving employees in key positions of private companies, including those in sales, financial, procurement and technical departments, had risen over the past few years.

Ma Yan, an official from the Supreme People’s Court, also lauded the expansion.

“These crimes, whether in Stateowned enterprises or private firms, essentially involve employees exploiting their work posts for illicit gains, and harming the interests of the companies,” he said.

To create a sound business environment for every market entity through the rule of law, he called for Chinese courts to accurately apply the amended law, which has also increased penalties for those giving bribes.

For example, it says that those offering bribes repeatedly, to multiple people, or parties involved in major national projects should face heavier punishment.

People who give bribes to staff members of supervisory, administrative or judicial departments, or bribes in fields such as the environment, finance, safety production, drug and food, social insurance, rescue relief, education or healthcare, also need to be severely punished, the law says.

Ma said that courts nationwide have been required to focus more on bribes in such fields, with a zerotolerance approach to fighting bribery.

He said the top court is working with the top procuratorate to formulate a judicial interpretation on handling corruption-related cases to ensure the law can be implemented effectively.

The expansion aims to prevent employees of private firms from taking illegal measures to damage the companies’ interests, with stronger protection for entrepreneurs.”

Xu Yong’an, an official from the Standing Committee of the National People’s Congress