The China Banking Regulatory Commission (CBRC) recently issued its Interim Measures for the Equity Management of Commercial Banks. The measures have tightened the CBRC's regulation of the information disclosure and reporting requirements imposed on material shareholders that have a significant impact on the operation and management of commercial banks established in China.
The State Council recently announced a pilot programme that has lifted the requirements on foreign-invested banks entering the renminbi yuan (Rmb) business market in Beijing until May 5 2018. As a result, foreign-invested banks are no long required to have operated for more than one year before applying to conduct Rmb business in Beijing. The programme is another step towards encouraging foreign investment in the financial sector.
The People's Bank of China recently released revised measures for the registration of a pledge of accounts receivable. The revised measures have broadened the definition of 'accounts receivable' and introduced a procedure for registering to transfer accounts receivable. For flexibility and convenience, the revised measures also adjust the registration term of a pledge of accounts receivable and extend the time limit for notifying a pledgee of any objection to its registration.
The Internet Financial Risk Special Rectification Work Leading Group Office recently issued a notice on rectification work regarding tokens issuance financing. In addition, a number of national authorities issued a joint announcement on the prevention of financial risks associated with token issuance. Following issuance of the notice and the joint announcement, initial coin offerings are now an illegal and unregulated method of raising money.
The People's Bank of China (PBOC) recently issued Announcement 209/2017 regarding the establishment of a non-bank payment entities network payment and clearing platform. The announcement is a major step towards the PBOC's establishment of a centralised and transparent online payment system with unified regulatory requirements for all non-bank payment entities, which should enable the PBOC to control any financial risks that may arise in the market.
The Ministry of Commerce recently promulgated the Measures for the Review of Concentrations of Business Operators (revised draft) for consultation. However, the revised draft still lacks provisions on the shifting alliances concept. The relevant Anti-monopoly Law enforcement agencies should consider this concept in future, as acknowledging it at the legislative level will finally place China's antitrust system among those of the world's most advanced anti-monopoly jurisdictions.
The Anti-monopoly Law enforcement agencies are increasingly investigating and finding fault with collective boycotts among competitors. As the presumption of illegality for collective boycotts requires a high level of compliance, businesses should be aware that although an independent decision not to deal with distributors or suppliers may not raise Anti-monopoly Law concerns, an agreement with competitors not to do so could raise such concerns.
The State Council recently submitted a proposal to the National People's Congress concerning the council's institutional reform programme. The proposal has shed light on the plans to consolidate the antitrust enforcement powers of the three antitrust agencies under the State Administration for Market Supervision. Although the merger is significant in terms of institutional reorganisation, it will not fundamentally change Anti-monopoly Law enforcement activities in China.
In 2017 the National Development and Reform Commission actively carried out legislative work and formulated and promulgated industrial guidelines and enforcement procedures. In addition, it remained active in its antitrust enforcement by not only penalising a variety of enterprises for anti-competitive conduct, but also targeting administrative agencies that had abused their administrative power in order to restrict or eliminate competition.
The National Development and Reform Commission recently released price conduct guidelines for business operators active in the drugs prone to shortages and active pharmaceutical ingredient (API) markets. The guidelines strengthen the API market's price supervision mechanism, clearly regulate market pricing behaviour with regard to drugs prone to shortages and APIs and provide practical guidance for relevant pharmaceutical companies with regard to their pricing behaviour.
The National Development and Reform Commission (NDRC) recently promulgated its Plan for Building the National Carbon Emission Trading Market (Power Generation Industry). According to the NDRC, the plan's implementation will play an important role in establishing the national carbon market and constitutes the official start of the national carbon emission trading system. However, a robust carbon emission trading system and a fair market trading environment for investors are still a long way off.
Under the existing legal framework, the state owns all mineral resources in China and the allocation of mining rights is heavily regulated. However, the various courts have different understandings of the relevant laws and regulations and judgment criteria for mining right disputes vary from court to court. As such, the Supreme People's Court recently issued an interpretation on the application of law in hearing cases involving mining right disputes.
The Ministry of Land and Resources (MLR) recently announced the Mineral Rights Granting System Reform Programme, which aims to promote the competitive granting of all types of mineral right in China. The programme requires the competent authorities to implement tender, auction and listing methods to grant mineral rights and imposes strict restrictions on the granting of mineral rights via agreements. It also requires the MLR to delegate its mineral rights approval powers to lower-level departments.
The Communist Party Central Committee and the State Council recently issued the Opinions on Deepening the Reform of the Petroleum and Natural Gas Sector. While the market-oriented reform of the entire oil and gas industrial chain includes no surprises, the opinions reflect the government's strong intentions behind the reform and send a positive signal to investors. However, the reform will not be an overnight success and significant resistance will be encountered.
The State Council recently promulgated the Plan for Mineral Resources Ownership Benefit System Reform with a view to transforming China's fiscal regime for the grant of mineral resources rights in an upcoming reform of the oil and gas upstream sector. The plan's primary purpose is to streamline the tax and fees system in China's mineral resources sector.
The Ministry of Environmental Protection recently issued new administrative measures concerning pollutants discharge permits. In addition to providing the issuance procedure for such permits, the measures stipulate penalties for various violations. The promulgation of the measures will likely be viewed as a signal of more stringent legislative control over enterprises' environmentally sensitive activities.
The State Council recently promulgated amendments to the Regulation on the Supervision and Administration of Medical Devices 2014, which took effect immediately. The amendments clarify issues relating to device distributors' liabilities when selling non-conforming products, the use of large medical equipment and the revocation of clinical study site certification.
The China Food and Drug Administration recently issued four new draft policies for public comment, proposing further reforms to the existing drug and medical device regulatory regime. The draft policies aim to expedite the review and approval of new drug and medical device applications, deregulate the conduct of clinical trials to encourage innovation, enhance post-market supervision throughout a product's lifecycle and protect innovators' rights.
The China Food and Drug Administration recently issued the Provisions for Medical Device Recall. While the new recall rules follow the basic regulatory framework for recalling devices provided in the existing rules, they also introduce some significant changes. The new rules clarify the scope of their application and the entity responsible for recalls, expand the definition of a 'defective product' and increase the penalties for manufacturers that refuse to implement mandatory recalls.
China's pharmaceutical industry is set to undergo further change as part of the healthcare reform initiatives recently announced by the State Council in its Circular on Several Opinions Concerning Further Reforms of the Policies Governing Drug Production, Circulation and Usage. The circular reinforces the government's determination to expedite the approval process for new drugs and calls for quality consistency tests for generics.
The China Food and Drug Administration recently proposed the most comprehensive revisions of the pharmaceutical good clinical practices (GCPs) in 13 years. The revisions have rewritten the articles of the existing pharmaceutical GCPs and provide general principles for conducting clinical studies in China; guidance on the roles and responsibilities of ethics committees, investigators and sponsors; and requirements for protocol and investigator brochures.