Interpretation clarifies criteria, punishment for bribery offences

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The Supreme People’s Court (SPC) and the Supreme People’s Procuratorate (SPP) released the Interpretation of Several Issues Concerning the Application of Law in Handling Criminal Cases Related to Graft and Bribery, which includes clarifying sentencing criteria for official (those involving government officials) and commercial bribery offences. The interpretation supplements the Criminal Law, revised in late 2015 (the ninth amendment), and strengthens the continuing anti-graft campaign in China.

interpretation-clarifies-criteria-punishment-for-bribery-offencesThe ninth amendment introduced stricter measures and sanctions for both individual and corporate offenders, including people in charge of a company or directly responsible for its business activities. The interpretation provides additional guidance on when enforcement might take place and explicitly states that bribes can include intangible benefits of commercial value.

The ninth amendment introduced punishment based on unclear criteria such as “relatively large” amounts or “relatively serious” circumstances, “huge” amounts or “serious” circumstances, and “especially huge” amounts or “especially serious” circumstances. In contrast, the interpretation provides detailed descriptions of the sentencing thresholds and standards for bribe givers and recipients of official and commercial bribery. Companies will find this a useful framework for implementing robust compliance policies and for demonstrating the consequences of falling foul of the Criminal Law.

However, as recently confirmed by the PRC judiciary, the interpretation’s clarification on monetary thresholds and sentencing standards do not include circumstances where bribe givers or recipients of official bribery are entities. For such entities, the threshold and standards remain the same as provided under the Criminal Law.

INTERPRETATION FEATURES

Intangible benefits. In addition to payments of money and tangible property, the interpretation expressly provides that the definition of “bribe” covers intangible benefits including material benefits of monetary value (e.g., house decorations, exemption of debt) and other benefits for which payment is made in exchange (e.g., membership services or paid travel).

Seeking illegal benefits for others. The interpretation enumerates circumstances considered as “seeking illegal benefits for others” in bribery cases: (1) actually seeking or promising to seek benefits for the bribe giver; (2) knowing that the bribe giver has specific business in connection with the bribe recipient’s duty or area of function; or (3) receiving money or property after the recipient’s performance of his or her duty as a reward for such performance. In addition, if a government official solicits or receives money or property, the cumulative value of which exceeds RMB30,000 (US$4,500), from his or her subordinate or a person subject to his or her administration, which may affect his or her performance of duty, this is deemed as promising to seek benefits for others.

Death penalty. The death penalty applies to embezzlement or official bribery cases if: (1) the accepted bribe or embezzlement amount is extremely large; (2) the situation is extremely serious; (3) the social influence is extremely negative; and (4) it has caused extremely large losses to the state and people’s interest. A two-year suspended death sentence may be issued if there are mitigating factors. In cases where the death penalty is deemed too severe for the crime, guilty parties may receive a life sentence without commutation or parole.

Business Law Digest is compiled with the assistance of Baker & McKenzie. Readers should not act on this information without seeking professional legal advice. You can contact Baker & McKenzie by e-mailing Danian Zhang (Shanghai) at: danian.zhang@bakermckenzie.com

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