31 December 2020
2020 Nian 8 Yue 28 days, Bao'an District of Shenzhen City Bureau of Justice issued an "enterprise Criminal Compliance independent monitoring candidates either and regulations (Trial)" (hereinafter referred to as " provisions " ), primarily covering corporate criminal compliant independent monitoring people Qualifications, selection methods, procedures and management.
The "Regulations" for the first time clarified the concept of an independent monitor of corporate criminal compliance (hereinafter referred to as "independent monitor"), that is, a law firm that is entrusted by a suspected company to investigate, plan, and supervise the criminal compliance of the company. Specifically, for suspected criminal enterprises, especially those that are in the review and prosecution stage in practice, they can entrust an independent supervisor to investigate the criminal compliance situation of the enterprise, assist in the formulation of a compliance plan and supervise the implementation, and issue periodic The written report serves as a reference for the procuratorate to make corresponding handling decisions on the suspected enterprise.
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"Independent monitors", or "compliance supervisors", "compliance supervisors", etc., are very important and common supporting measures in the compliance non-prosecution system. Since the main role of independent monitors is to assist the suspected enterprises in rectifying illegal activities, formulating compliance plans and supervising implementation, there are basic requirements for independence and professionalism of independent monitors: |
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Independence, the procuratorate or the suspected enterprise entrusts a third-party agency as an independent monitor. On the one hand, it can avoid the legitimacy and integrity issues arising from the role of the procuratorial agency as a supervisory agency (if it has the power to make decisions on prosecution), and on the other hand, it can also reduce the burden on the procuratorial agency to a certain extent.
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Professionalism. Compliance procedures such as internal investigation, diagnosing corporate compliance risks, improving corporate operation methods and compliance systems all require the professional assistance of compliance inspectors (such as law firms) to prevent the company from breaking the law again and to encourage the company Compliance management is the ultimate goal of promoting the development of a virtuous circle of enterprises.
At present, in my country's practical cases, some regional procuratorates have begun the practice of non-prosecution for compliance and independent monitoring of persons. For example, in March 2020, the Procuratorate of Xinwu District, Wuxi City made a relatively non-prosecution in a case of falsely issuing special VAT invoices. While making the decision not to prosecute, the procuratorial agency also issued a "Prosecution Proposal" for business operations and compliance issues. Based on this, the company hired a legal professional team composed of experts and practicing lawyers to help formulate a complete set of compliance programs. In this case, the "legal professional team composed of experts and practicing lawyers" hired by the company actually played the role of an independent monitor, which played a positive role in improving the company's compliance system, operating legally, and preventing recurrence risks.
In addition, various regions of our country have also begun system trials. In addition to the above "Provisions", Daishan County People's Procuratorate issued the "Procedures for Criminal Compliance in Enterprise-Involved Cases (Trial)" ("Procedures") on September 27, 2020. Articles 4, 5, and Articles Articles 8 and 9 deal with the relevant provisions of "compliance supervisors". For example, compliance supervisors should be selected from law firms, accounting firms, tax accountant firms, etc., and companies involved in the case have the right to recommend professional compliance supervisors. The rectification plan must include accepting the supervision of the dispatched compliance personnel and assisting the compliance supervisor to conduct investigations.
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In January 2020, the Supreme Prosecutor General Zhang Jun stated at the National Prosecutors’ Conference: “On the one hand, we will use greater efforts to protect the legitimate rights and interests of private enterprises and entrepreneurs, and to ensure that those who can’t be arrested or prosecuted will not be arrested. Those who do not prosecute and can not be sentenced will propose probation recommendations, and it is necessary to vigorously promote private enterprises to build a bottom line of law-abiding and compliance." This statement is also sufficient to reflect my country’s determination to promote the development of corporate criminal compliance incentive mechanisms. |
Through the above-mentioned cases and system pilots, it can be seen that the practice of "corporate compliance non-prosecution" in unit crime cases is currently mainly determined by the procuratorial agency based on the company’s criminal facts and circumstances, confessions and punishments, and the company’s compliance commitments and rectification. Determine whether to make a relatively non-prosecution decision. Among these, “compliance supervisors” and “independent monitors” are one of the keys to the compliance rectification of suspected companies. Independent monitors find problems that the company needs to rectify, assist the company in establishing a compliance system, and supervise The company's compliance plan and implementation play an important role, and it is also a bridge connecting the suspected company with the procuratorial organ.
Although the practice of independent monitors in China is still in its infancy, the system has been fully implemented in the United States, Britain, France, and Canada. For example, in the U.S. sanctions against ZTE in 2018, the Bureau of Industrial Security (BIS) of the U.S. Department of Commerce and ZTE reached an "Alternative Settlement Agreement", which included the acceptance of designated compliance inspectors and the employment of special compliance coordinators by companies, and Obligation to accept its agreement to supervise and guide the reconstruction of export control compliance programs.
To sum up, although there are still many problems in the practice of independent supervisors, such as the time of entry, supervision period, scope of responsibility, fee standards, conflicts with lawyers’ practice standards, etc., it focuses on the development of criminal compliance in China Trends and international developments, the establishment of a compliance non-prosecution system is the general trend, and we can further expect more complete and effective measures to be implemented.
For further information, please contact:
Peng Qiao, R&P China Lawyers
info@rplawyers.com
