Amendment 6 to the Criminal Law of the People’s Republic of China (VI) - 2006

(The Amendments to the Criminal of the People’s Republic of China (VI), which were deliberated at the 22nd meeting of the Standing Committee of the Tenth National People’s Congress on June 29, 2006, are hereby promulgated and shall take effect as of the date of promulgation)

President of the People’s Republic of China Hu Jintao
June 29, 2006

Amendments to the Criminal Law of the People’s Republic of China (VI)
(Adopted at the 22nd meeting of the Standing Committee of the Tenth National People’s Congress on June 29, 2006)

I. Article 134 of the Criminal Law is amended as: “Where anyone violates the provisions concerning the safety management in production or operations and thus causes any serious casualty or any other serious consequences, he shall be sentenced to fix-term imprisonment of not more than three years or detention. If the circumstances are extremely severe, he shall be sentenced to fix-term imprisonment of not less than 3 years but not more than 7 years.
“Where anyone forces any other person to conduct risky operations by violating the relevant provisions so that any serious casualty or any other serious consequence is caused, he shall be sentenced to fix-term imprisonment of not more than five years or detention. If the circumstances are extremely severe, he shall be sentenced to fix-term imprisonment of five years or more.”

II. Article 135 of the Criminal Law is amended as: “Where the facilities or conditions for safe work fail to meet the relevant provisions of the state so that any serious casualty or any other serious consequence is caused, the persons-in-charge who are held to be directly responsible and other directly liable persons shall be sentenced to fixed-term imprisonment of not more than three years or detention. If the circumstances are particularly severe, he shall be sentenced to fix-term imprisonment of not less than three years but not more than seven years.”

III. An article is inserted after Article 135 as Article 135 (I): “Where, any of the provisions concerning safety management is violated in the holding of large-scale activities of the masses so that any serious casualty or any other serious consequence is caused, the persons-in-charge who are held to be directly responsible and other directly liable persons shall be sentenced to fixed-term imprisonment of not more than three years or detention. If the circumstances are particularly severe, they shall be sentenced to fixed-term imprisonment of not less than three years but not more than seven years.”

IV. An article is inserted after Article 139 as Article 139 (I): “Where, after any safety accident occurs, the person who is obliged to report it fails to report it or makes a false report so that the rescue of the accident is affected and if the circumstances are severe, he shall be sentenced to fixed-term imprisonment of not more than three years or detention. If the circumstances are extremely severe, he shall be sentenced to fixed-term imprisonment of not less than three years but not more than seven years.”

V. Article 161 of the Criminal Law is amended as: “Where any company or enterprises which is obliged to disclose information to its shareholders or the general public provides any false financial and accounting statements or conceals any important facts in such statements or fails to disclose any other important information that shall be disclosed according to law so that the interests of the shareholders or any other person are severely injured, or where there are other severe circumstances, the persons-in-charge who are held to be directly responsible and other directly liable persons shall be sentenced to fix-term imprisonment of not more than three years or detention, and/or shall be fined 20,000 yuan up to 200,000 yuan.”

VI. An article is inserted after Article 162 (I) as Article 162 (II): “Where any company or enterprise transfers or disposes of its properties by means of concealing its properties or undertaking fabricated debts or by any other means or goes through false bankruptcy so that the interests of the creditors or any other person are severely injured, the persons-in-charge who are held to be directly responsible and other directly liable persons shall be sentenced to fixed-term imprisonment of not more than five years or detention, and/or shall be fined 20,000 Yuan up to 200,000 Yuan.”

VII. Article 163 of the Criminal Law is amended as: “Where any of the employees of any company or enterprise or any other entity exerts any property by taking advantage of his position or accepts any money or property of any other person so as to seek any benefits for such person, and if the amount is considerably large, he shall be sentenced to fixed-term imprisonment of not more than five years or detention. If the amount is huge, he shall be sentenced to fixed-term imprisonment of less than five years, and his properties may be confiscated.
“Where any of the employees of any company or enterprise or any other entity violates the relevant provisions of the state by taking advantage of his position to accept kickbacks or commissions in any disguise and keeps them for himself, he shall be penalized according to the preceding paragraph.
“Where anyone who is engaged in public services in any state-owned company, enterprise or any other state-owned entity or anyone is delegated by any state-owned company or enterprise or any other state-owned entity to any non-state-owned company or enterprise or any other entity to engage in public services commits any of the acts as described in either of the preceding paragraphs shall be convicted and penalized according to Articles 185 and 186 of the present Law.”

VIII. Paragraph 1, Article 164 of the Criminal Law is amended as: “Anyone who gives a considerably largely amount of money or property to any of the employees of any company or enterprise or any other entity for the purpose of seeking illegal benefits shall be sentenced to fixed-term imprisonment of not more than three years or detention. If the amount is huge, he shall be sentenced to fixed-term imprisonment of not less than three years but not more than ten years, and shall be fined.”

IX. An article is inserted after Article 169 of the Criminal Law as Article 169 (I): “Where any director, supervisor or senior manager of any listed company goes against his fiduciary duty to the company and takes advantage of his position to manipulate the listed company in any of the following circumstances so that the listed company suffers from any serious loss, he shall be sentenced to fixed-term imprisonment of not more than three years or detention, and/or shall be fined. If the listed company thus suffers from extremely serious losses, he shall be sentenced to fixed-term imprisonment of not less than three years but not more than seven years, and shall be fined:
(1) Providing any fund, commodity, service or any other asset gratuitously to any other entity or individual;
(2) Providing or accepting any fund, commodity, service or any other asset under obviously unfair terms;
(3) Providing any fund, commodity, service or any other asset to any entity or individual who obviously does not have the ability of repayment;
(4) Providing any guarantee to any entity or individual who obviously does not have the ability of repayment, or providing guarantee to any other entity or individual without justifiable reasons;
(5) Waiving any credit or undertaking any debt without justifiable reasons;
(6) Injuring the interests of the listed company by any other means.
Where the controlling shareholder or actual controller of a listed company instigates any of the directors, supervisors, or senior managers of the listed company to conduct any of the acts as described in the preceding paragraph, it or he shall be penalized according to the preceding paragraph.
If the controlling shareholder or actual controller of the listed company that commits the crime as described in the preceding paragraph is an entity, a fine shall be imposed upon the entity and the persons-in-charge who are held to be directly responsible and other directly liable persons shall be penalized according to the first paragraph herein.”

X. An article is inserted after Article 175 as Article 175 (I): “Where anyone obtains by fraudulent means any loan, acceptance of any instrument, letter of credit, letter of guarantee, etc. from any bank or any other financial institution so that any serious loss is caused to the bank or financial institution or any other serious consequence has resulted, he shall be sentenced to fixed-term imprisonment of not more than three years or detention, and/or shall be fined. If the loss caused to the bank or any other financial institution is extremely large or if there is any other extremely serious circumstance, he shall be sentenced to fixed-term imprisonment of not less than three years but not more than seven years, and shall be fined.
“Where any entity commits the crime as described in the preceding paragraph, it shall be fined, and the persons-in-charge who are held to be directly responsible and other directly liable persons shall be penalized according to the preceding paragraph.”

XI. Article 182 of the Criminal Law is amended as: “Where any of the following circumstances arises, and if the circumstances are serious, the person who manipulates the securities or futures market shall be sentenced to fixed-term imprisonment of not more than five years or detention, and/or shall be fined. If the circumstances are extremely serious, he shall be sentenced to fixed-term imprisonment of not less than five years but not more than 10 years, and shall be fined:
(1) Manipulating the trading prices of securities or futures or the trading volume of securities or futures by concentrating independently or by collusion the advantages in capital or the advantages in shareholding or positions or the advantage in information so as to carry out colluded or continuous transactions;
(2) Colluding with any other person to carry out securities or futures transactions with each other according to the time, price or ways as agreed to in advance so that the trading prices or volumes of securities or futures are affected;
(3) Making securities transactions among the accounts under the actual control of his own or taking himself as the object of trading of futures agreements so that the trading prices or volumes of securities or securities are affected;
(4) Manipulating the securities or futures markets by any other means.
Where any entity commits the crime as described in the preceding paragraph, a fine shall be imposed upon the entity, and the persons-in-charge who are held to be directly responsible any other liable persons shall be penalized according to the preceding paragraph.”

XII. An article is inserted after Article 185 as Article 185 (I): “Where any commercial bank, stock exchange, futures exchange, securities company, futures brokering company, insurance company, or any other financial institution violates its fiduciary duty, unlawfully utilizes the funds or any other entrusted property of its clients, and if the circumstances are serious, a fine shall be imposed upon the entity, and the persons-in-charge who are held to be directly responsible as well as other directly liable persons shall be sentenced to fixed-term imprisonment of not more than three years or detention, and shall be fined 30,000 Yuan up to 300,000 Yuan. If the circumstances are extremely serious, they shall be sentenced to fixed-term imprisonment of not less than three years but not more than ten years, and shall be fined 50,000 Yuan up to 500,000 Yuan.
“Where any public fund management institution such as a social security fund management institution or housing accumulation fund management institution, or any insurance company, insurance asset management company, or securities investment fund management company violates any of the state provisions in its use of funds, the persons-in-charge who are held to be directly responsible and other directly liable persons shall be penalized according to the preceding paragraph.”

XIII. Paragraphs I and II of Article 186 of the Criminal Law are amended as: “Where any of the employees of any bank or any other financial institution grants any loan by violating the relevant provisions of the state and the sum is huge or any serious loss has resulted, he shall be sentenced to fixed-term imprisonment of not more than five years or detention, and shall be fined 10,000 Yuan up to 100,000 Yuan. If the sum is extremely huge or extremely serious losses have resulted, he shall be sentenced to fixed-term imprisonment of more than five years, and shall be fined 20,000 Yuan up to 200,000 Yuan.
“Where any employee of any bank or any other financial institution violates the relevant provisions of the state to grant loans to any of his relatives, he shall be penalized according to the preceding paragraph.”

XIV. Paragraph I of the Article 187 of the Criminal Law is amended as: “Where any employee of any bank or any other financial institution accepts the money of any client without writing it into the accounts, and if the sum is huge or if any serious loss has resulted, he shall be sentenced to fixed-term imprisonment of not more than five years, and shall be fined 20,000 Yuan up to 200,000 Yuan. If the sum is extremely huge or the losses are extremely serious, he shall be sentenced to fixed-term imprisonment of five years or more, and shall be fined 50,000 Yuan up to 500,000 Yuan.”

XV. Paragraph I of Article 188 of the Criminal Law is amended as: “Where any employee of any bank or any other financial institution violates the relevant provisions when issuing any letter of credit, letter of guarantee, instrument, certificate of deposit, certification of credit, etc. to any other person, and if the circumstances are serious, he shall be sentenced to fixed-term imprisonment of not more than five years or detention. If the circumstances are extremely severe, he shall be sentenced to fixed-term imprisonment of five years or more.”

XVI. Paragraph I of Article 191 of the Criminal Law is amended as: “Where anyone who obviously knows that any incomes are obtained from any drug-related crime, organizational crime of any gangland, terrorist crime, crime of smuggling, crime of corruption or bribery, crime of disrupting the financial management order, crime of financial fraud, etc. as well as the proceeds generated there from, yet commits any of the following acts for the purpose of disguising or concealing the origin or nature thereof, the incomes obtained from the commission of the aforementioned crimes as well as the proceeds generated there from shall be confiscated, and the offender shall be sentenced to fixed-term imprisonment of not more than five years or detention, and/or shall be imposed a fine of 5% up to 20% of the amount of laundered money. If the circumstances are serious, he shall be sentenced to fixed-term imprisonment of not less than five years but not more than ten years, and shall be imposed a fine of 5% up 20% of the amount of laundered money:
(1) Providing any capital account;
(2) Assisting the transfer of property into cash, financial instruments, or negotiable securities;
(3) Assisting the transfer of capital by means of transfer accounts or any other means of settlement;
(4) Assisting the remit of funds to overseas;
(5) Disguising or concealing the origin or nature of any crime-related income or the proceeds generated there from by any other means.”

XVII. An article is inserted after Article 262 of the Criminal Law as Article 262 (II): “Where anyone organizes any disabled person or any minor below the age of 14 by force or coercion to beg, he shall be sentenced to fixed-term imprisonment of not more than three years or detention, and shall be fined. If the circumstances are serious, he shall be sentenced to fixed-term imprisonment of not less than three years not more than seven years, and shall be fined.”

XVIII. Article 303 of the Criminal Law is amended as: “Anyone who organizes gambling parties or is engaged in gambling as his main business for the purpose of making profits shall be sentenced to fixed-term imprisonment of not more than three years, detention, or surveillance, and shall be fined.
“Anyone who establishes or runs any casino shall be sentenced to fixed-term imprisonment of not more than three years, detention, or surveillance, and shall be fined. If the circumstances are serious, he shall be sentenced to fixed-term imprisonment of not less than three years but not more than ten years, and shall be fined.”

XIX. Article 312 of the Criminal Law is amended as: “Where anyone who obviously knows that the income or the proceeds are generated there from is obtained from the commission of any crime harbors, transfer, purchases or sells them as an agent or disguises or conceals them by any other means, he shall be sentenced to fixed-term imprisonment of not more than three years, detention, or surveillance, and/or shall be fined. If the circumstances are serious, he shall be sentenced to fixed-term imprisonment of not less than three years but not more than seven years, and shall be fined.”

XX. An article is inserted after Article 399 of the Criminal Law as Article 399 (I): “Where anyone who undertakes the duties of arbitration according to law intentionally goes against the facts or law and makes any wrongful ruling in the process of arbitration, he shall be sentenced to fixed-term imprisonment of not more than three years or detention. If the circumstances are extremely serious, he shall be sentenced to fixed-term imprisonment of not less than three years but not more than seven years.”

XXI. The present Amendments shall come into effect as of the date of promulgation.