The newly amended (“Amended Law”) Anti-unfair Competition Law of the People’s Republic of China (“AUC Law”) first time creates extraterritorial jurisdiction over overseas bribery, where unfair competition carried out outside of China, that harms the Chinese market and business operators, will be liable and pursuable under the Amended Law. Such update in Amended Law is in accordance with the recent strict anti-bribery and anti-corruption (“ABAC”) practice in China, and will come into effect on October 15, 2025.
1. Extraterritorial Jurisdiction under the Amended Law
Along with the blooming of out-bound business among Chinese operators, we have recently observed cases where Chinese laws applied to bribery happening outside China. For example, in Guangzhou v. Xi, Zhou (2023), the criminal court rendered a guilty judgement against the defendants (i.e., the general manager and the deputy general manager of the Singaporean subsidiary of a Chinese state-owned enterprise) for committing crime of offering bribes to foreign public officials. In that case, from 2017 to 2019, the defendants, in exchange for commercial benefits, offered bribes of SGD 220,000 to local Singaporean public officials.
Additionally, compared with the long-arm jurisdiction under the United States’ Foreign Corrupt Practices Act (“FCPA”), China has extraterritorial jurisdiction provision under its criminal laws (where investigation authorities such as police and supervisory committee, etc. shall have the power to investigate criminal offence in accordance with relevant procedural laws, compared to the US DOJ’s investigation power under the FCPA against criminal offence).
However, compared with the civil liability (please note that under the Chinese law, such civil liability is more like the concept of administrative liability where violation may cause government investigation and monetary fines) against the overseas bribery under the FCPA, in the past, there is not quite similar counterpart under the Chinese ABAC administrative laws. That is why Article 40 of the Amended Law is so important: for the very first time, it expressly prescribes that “[u]nfair competition carried out outside the territory of the People’s Republic of China, which disrupts the market competition order within the territory or damages the legitimate rights and interests of business operators within the territory, shall be handled in accordance with the provisions of this law and relevant laws”. Please note that compared with US SEC as the investigation authority for FCPA civil violation, Chinese administration for market regulation (“AMR”) would be the competent authority investigating and punishing administrative violation with cause of action of commercial bribery.
Recently, while US President Trump restricts enforcement of the FCPA from both criminal and corporate liability perspectives, we observe that China takes the opposite approach and increases legislation and enforcement combatting bribery (please see several recent case precedents discussed below in Part 3). For example, the amended provisions under the Amendment XII to the Criminal Law of the People’s Republic of China (2024) mainly focused on ABAC matters, and in practice, ABAC inspections are frequently and periodically carried out in many different industries including but not limited to healthcare and pharmaceutical, natural resource and energy, chemistry, biology, banking and finance, securities, real estate, heavy industry, automobile, service, etc. In the future, it is likely that extraterritorial jurisdictions could increasingly apply to ABAC cases.
2. Other Highlights of the Anti-commercial Bribery Provisions in the Amended Law
(1) It expressly includes the entity and individual taking bribes (“Bribe-taking Party”) in the liable subject
According to Article 8 of the Amended Law, the following entities and individuals shall not accept bribes:
a. Staff members of a transaction’s counterparty;
b. Entities or individuals entrusted by the counterparty of a transaction to engage in affairs; or
c. Entities or individuals influencing transactions by taking advantage of their duty or influence.
Article 24 of the Amended Law imposes monetary and disqualification punishments on the Bribe-taking Party. Please see Part (2) below for more details.
(2) Improved and optimized punishment matrix
Below please find a comparison chart of the punishments prescribed under the current version of the AUC Law and the Amended Law against commercial bribery:
* Note: RMB 1 = USD 0.139421 as of June 28, 2025
3. Recent Practical Trends in ABAC
ABAC has become increasingly a focus of law enforcement authorities. In April 2025, we published an article discussing a case in which a USD 56.30 tea gift was deemed a commercial bribe. On June 13, 2025, the AMR of Shanghai’s Hongkou District rendered an administrative punishment decision (“Decision”) against a logistics company for breaching the anti-commercial bribery provisions under the AUC Law. AMR’s findings were:
“In April 2023, in order to seek trading opportunities, the legal representative (“Legal Representative”) of the logistics company (“Company A”) expressed to the deputy manager (“Manager”) of an import and export company (“Company B”) that he hoped to have priority over other freight forwarders to undertake the international freight forwarding business of Company B with the deputy manager’s assistance. The Legal Representative then gave a box of tea worth RMB 694 (approx. USD 96.76) to the Manager, and promised to provide the Manager with more properties later. The Manager agreed. From April to October 2023, the Manager, taking advantage of his position, assigned four international cargo transportation businesses of Company B to Company A. After completing the four transactions, at the end of December 2023, Company A gave the Manager a pair of headphones worth RMB 3,999 (approx. USD 557.54).”
Based on these findings, the AMR decided that Company A violated the anti-commercial bribery provisions under AUC Law, and rendered an administrative penalty on Company A. The administrative decision was to be disclosed to the public in accordance with the law.
4. JunHe Comments
Considering the laws and case precedents above and as mentioned in previous articles, we believe that this recent series of ABAC cases, where the value of a business gift was subject to strict scrutiny, should raise alarms for MNCs operating in China. Anti-bribery laws in China remain strictly enforced and a “zero tolerance” of corruption is needed.
