Judicial Interpretation Provides Guidance On China’s Bribery Offences.

 

Offence	Threshold/ circumstances	Sentences under Article 390 (offering bribes to State Personnel)	Sentences under Article 390-1 (offering bribes to a close relative of, or any person close to, State Personnel)
For the purpose of seeking illegitimate benefits, offering bribes to State Personnel (Article 7 of the Interpretation)	The amount of the bribe is more than RMB 30,000; or The amount of the bribe is more than RMB 10,000 but less than RMB 30,000, and any of the following circumstances apply (aggregating factors): (a) The bribe was offered to more than three people; (b) The bribe was derived from illegal income; (c) The bribe was offered to seek promotion or adjustment of job position; (d) The bribe was offered to State Personnel who have supervisory and administrative responsibilities for food, drugs, safety production, environmental protection, etc. in order to commit illegal activities; (e) The bribe was offered to State Personnel at judicial departments, and it influences judicial justice; or (f) The bribe resulted in economic loss of more than RMB 500,000 but less than RMB 1 million.	Imprisonment of not more than five years, and fines	Imprisonment of not more than three years, and fines
Offering bribes to secure illegitimate benefits and the circumstances are serious or the action causes major national loss (Article 8 of the Interpretation)	“Circumstances are serious” means one of the following situations: The amount of the bribe is more than RMB 1 million but less than RMB 5 million;  The amount of the bribe is more than RMB 500,000 but less than RMB 1 million, and one of the aggregating factors (a)-(e) above applies; or Other serious circumstances “Major national loss” means economic loss in excess of RMB 1 million but less than RMB 5 million	Imprisonment of not less than five years but no more than ten years, and fines	Imprisonment of not less than three years but no more than seven years, and fines
Offering bribes to secure illegitimate benefits and the circumstances are extraordinarily serious, or the action causes extraordinary major national loss (Article 9 of the Interpretation)	“Circumstances are extraordinarily serious” means one of the following situations: The amount of the bribe is more than RMB 5 million;  The amount of the bribe is more than RMB 2.5 million but less than RMB 5 million, and one of the aggregating factors (a)-(e) above applies; or other extraordinarily serious circumstances “Extraordinary major national loss” means the economic loss resulting from the bribe is more than RMB 5 million.	Imprisonment of not less than ten years or life imprisonment, fines, and confiscation of property (if appropriate)	Imprisonment of not less than seven years but no more than ten years, and fines

 

Further thresholds set out in the Interpretation include:

 

Corporate offence of offering bribes to persons associated with State Personnel: One of the key changes in the November 2015 amendments was Article 390-1, which criminalises bribes offered to persons closely associated with State Personnel.

 

The Interpretation provides that this offence can result in corporate liability. If an entity offers bribes to a close relative, or any person close to, State Personnel, it can be prosecuted under Article 390-1 of the Criminal Law. Under Article 10 of the Interpretation, the prosecution threshold for this offence is bribes of RMB 200,000 or more.

 

Commercial bribery: A bribe to non-State Personnel (ie, commercial bribery) is criminalised under Article 164 of the Criminal Law. Article 11 of the Interpretation provides the “starting points” for prosecution of these offences, which had until now been undefined for the purposes of commercial bribery. If the bribe is more than RMB 60,000, it will be considered “relatively large” under Article 164 and result in imprisonment of not less than three years. If the bribe is more than RMB 2 million, it will be considered “huge” and result in imprisonment of more than three years but less than ten years and fines.

 

Mitigating factors: The November 2015 amendments to the Criminal Law provide that if the underlying crime is relatively minor and the offender plays a key role in investigating or solving a major case, liability may be mitigated or exempted. Furthermore, offenders who self-report that they have offered bribes may be given a reduced or mitigated sentence.

 

Article 14 of the Interpretation provides further guidance on the applicable mitigating circumstances. In particular, it interprets “relatively minor crimes” as crimes for which no more than three years imprisonment can be imposed according to the sentencing standard above. If the self-report plays a key role in the investigation or resolution of a “major case”, mitigation or exemption may be available. Here, “major case” means a case where imprisonment of more than 10 years may be imposed according to the sentencing standard above. The following actions constitute “a key role in investigating or solving a major case”:

 

• self-reporting information not yet discovered by the authorities;
• self-reporting information not directly related to a major case, but which plays an important role in resolving a major case;
• self-reporting having offered a bribe, which in turn plays a significant role in collecting evidence for a major case; or
• self-reporting having offered a bribe, which is significant in tracking down fugitives or criminal proceeds.

 

Criminal Fines and Disgorgement: The November 2015 amendments to the Criminal Law added criminal fines as another possible penalty, in addition to imprisonment as discussed above, for a number of bribery offences. Article 19 of the Interpretation provides that the range of fines should be between RMB 100,000 and twice the amount of the bribe. Article 18 of the Interpretation also provides that illegal gains from bribery offences should be disgorged and, if applicable, returned to victims.

 

Comment

 

Whilst it will take some time for the Interpretation to ‘bed down’ and face judicial analysis, it nevertheless brings some clarity to a range of bribery provisions under the Criminal Law. In particular, it seeks to remedy several ambiguities in language introduced by the November 2015 amendments. It also aims to tackle new forms of corruption, eg, bribes paid in non-cash forms. The Interpretation also reinforces the Chinese government’s focus on corruption, and represents the latest step in president’s Xi Jinping’s commitment to clamp down on graft at all levels.