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On 9 September 2020, China's Ministry of Commerce released Provisions on the Unreliable Entity List, which take immediate effect upon their release.2020919
According to the regulation, the work mechanism can decide to take one or multiple measures against foreign entities on the unreliable entity list, and make a public announcement:
1. Restrict or ban its China-related import & export activities;12. Restrict or ban its investment in China;23. Restrict or ban the entry into China of its staff or transport facilities;34. Restrict or revoke its staff's work permits, stay or residential qualifications in China;45. Impose penalties according to the severity of its unlawful activities;56. Other necessary measures.6
Since 31 May 2019, when the Ministry of Commerce first announced the establishment of an "unreliable entity inventory system", the so-called Chinese version of the "entity list system" has attracted widespread attention from Chinese and foreign companies.2019531In an interview with journalists on 1 June 2019, an official from the Ministry of Commerce said that the Chinese government will take into account four factors, when it decides whether to include an entity on the "list of unreliable entities":
First, whether the entity has imposed a blockade, cut off supply or other discriminatory measures against the Chinese entity;Second, whether the entity's behavior is based on non-commercial purposes, contrary to market rules and the spirit of contract;Third, whether the entity's behavior has caused substantial damage to Chinese enterprises or related industries;Fourth, whether the entity's conduct poses a threat to national security or a potential threat.
It looks like the final provisions have made changes in two aspects: one is to highlight the "national sovereignty, security and development interests". The other one is, adding to consider whether it is in accordance with international business and trade rules.201961
.
For more information please visit MOFCOM


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Hot off the press! Provisions on the Unreliable Entity List

Tap "LegalTips"

to follow us

You might feel interested in:The Top Five Things Youll Need to Do While Purchasing PPE
PRC Civil Code: Part VII Liability for Tort
Right to Privacy and Protection of Personal Information
On 9 September 2020, China's Ministry of Commerce released Provisions on the Unreliable Entity List, which take immediate effect upon their release.2020919
According to the regulation, the work mechanism can decide to take one or multiple measures against foreign entities on the unreliable entity list, and make a public announcement:
1. Restrict or ban its China-related import & export activities;12. Restrict or ban its investment in China;23. Restrict or ban the entry into China of its staff or transport facilities;34. Restrict or revoke its staff's work permits, stay or residential qualifications in China;45. Impose penalties according to the severity of its unlawful activities;56. Other necessary measures.6
Since 31 May 2019, when the Ministry of Commerce first announced the establishment of an "unreliable entity inventory system", the so-called Chinese version of the "entity list system" has attracted widespread attention from Chinese and foreign companies.2019531In an interview with journalists on 1 June 2019, an official from the Ministry of Commerce said that the Chinese government will take into account four factors, when it decides whether to include an entity on the "list of unreliable entities":
First, whether the entity has imposed a blockade, cut off supply or other discriminatory measures against the Chinese entity;Second, whether the entity's behavior is based on non-commercial purposes, contrary to market rules and the spirit of contract;Third, whether the entity's behavior has caused substantial damage to Chinese enterprises or related industries;Fourth, whether the entity's conduct poses a threat to national security or a potential threat.
It looks like the final provisions have made changes in two aspects: one is to highlight the "national sovereignty, security and development interests". The other one is, adding to consider whether it is in accordance with international business and trade rules.201961
.
For more information please visit MOFCOM


Tap "Read More" to visit our website

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