China: China's Supreme Court And Supreme Procuratorate Issue Interpretation On Bribery Laws

On April 18, 2016, the Supreme People's Court and the Supreme People's Procuratorate issued Interpretations of the Supreme People's Court and the Supreme People's Procuratorate on Several Issues Concerning the Application of Law in Handling Cases of Bribery and Corruption (Interpretation), which clarifies ambiguities arising from 2015 amendments to China's Criminal Law.  The Interpretation clarifies changes concerning bribery offenses, including (i) the types of payments that may constitute a bribe, (ii) monetary thresholds for the seriousness of bribery offenses, (iii) circumstances in which individuals may qualify for leniency, and (iv) ranges for the amount of monetary penalties in bribery cases.  The Interpretation evidences a continued focus on bribery and corruption case by China's judiciary, and also brings welcomed clarity to recent changes to the Criminal Law.  We summarize below the key changes in the Interpretation. 

1. Types of Payments that May Constitute a Bribe

Articles 385, 386, 388, 389 and 390 of China's Criminal Law prohibit payments of "money or property" to public officials for the purpose of obtaining improper benefits, or public officials from accepting such payments.  The Interpretation provides examples of types of "money or property" whose provision to public officials may violate these articles, including currency, property, and "proprietary interests."  The proprietary interests category is intentionally broad and includes any kind of material interests that could be converted into currency.  Examples of proprietary interests include house decorations, discharges of debts, provision of travel, or memberships.  The Interpretation provides that the value of such proprietary interests will be calculated based on how much has actually been paid or how much the recipient would otherwise have paid for the underlying interests.

2.  Monetary Thresholds for Bribery Offenses

A change introduced in the 2015 amendment to China's criminal law was the elimination of monetary thresholds regarding the severity of bribery offenses, which determines corresponding punishments. Instead, the amendment replaced such thresholds with three categories: "relatively large", "huge", or "especially huge".  While seemingly intended to give authorities greater discretion in defining the severity of a bribery offense, these amendments also introduced uncertainty as to potential penalties because of the lack of specificity regarding these new categories.  The Interpretation clarifies these changes by creating new monetary thresholds for each category.

The Interpretation clarifies the monetary value of bribes under Article 383 of the Criminal Law. A "relatively large" bribe is more than CNY30,000 and up to CNY200,000, with punishments including fixed-term imprisonment or detention of no more than three years, together with monetary fines.  Next, the Interpretation defines a "huge" bribe as being more than CNY200,000 and up to CNY3 million, which results in a fixed-term imprisonment of more than three years but less than ten years, together with fines or confiscation of property.  Finally, the Interpretation defines an "especially huge" bribe as more than  CNY3 million, which results in a fixed-term imprisonment of more than ten years and up to life imprisonment, or even the death penalty, together with fines or confiscation of property.

The Interpretation also provides monetary thresholds for the amount of bribes offered to public officials under Article 390 of the Criminal Law, generally requiring that such bribes be more than CNY30,000.  Individuals can also be punished under Article 390 for offering bribes of between CNY10-30,000  in certain circumstances, such as where bribes are offered to management or supervisory officials in key areas (e.g., product safety, environment, pharmaceuticals, food, etc.), or where bribes are offered to judicial officials to impede the judicial process. Offering bribes of between CNY1 million and 5 million constitutes "serious circumstances," and may result in a fixed-term imprisonment of between five and 10 years, together with monetary penalties.  Offering bribes of more than CNY5 million constitutes "especially serious circumstances", and may result in fixed-term imprisonment of more than ten years and up to life imprisonment, together with fines or confiscation of property.   

The Interpretation also provides monetary thresholds for commercial bribery offenses under Articles 163 and 164 of the Criminal Law.  Under Article 163, accepting commercial bribes over CNY60,000 are considered "relatively large" offenses, and accepting bribes over CNY1 million are "huge" offenses. Under Article 164, offering commercial bribes over CNY60,000 are considered "relatively large" offenses, and offering bribes over CNY2 million are "huge" offenses.

3. Qualifying for Leniency Under Criminal Law

The 2015 amendments to Article 390 of the Criminal Law had seemingly restricted circumstances in which individuals might seek leniency for bribery violations, requiring that they play "a critical role in detecting a major case."  The Interpretation clarifies how individuals might qualify for such lenience by listing examples of assistance in major cases, including (i) providing new evidence not previously obtained for a major on-going case, (ii) providing evidence that helps officials detect a new major case, (iii) providing facts related to bribery which play critical role in evidence collection for on-going major case, or (iv) providing evidence that is critical to capturing a fugitive or illegally acquired assets/property in a major case.

4. Mandatory Monetary Penalties in Bribery Cases

The 2015 amendments to the Criminal Law also added mandatory monetary penalties to bribery convictions, and the Interpretation clarifies the amounts of such fines.  The Interpretation ties the amount of fines to the length of sentencing, with (i) fines of CNY100-500,000 for prison sentences of 3 years or less, (ii) fines of more than CNY200,000 but less than twice the amount of bribes/confiscated property when sentenced to between 3 and 10 years imprisonment, and (iii) fines of more than CNY500,000 but less than twice the amount of bribes/confiscated property where sentenced to between 10 years and life imprisonment.  Other convictions of bribery-related offenses without prison sentences shall pay fines of more than CNY100,000 but less than twice the relevant bribes.  While the Interpretation still provides for wide ranges of fines and thus leaves some discretion with officials, the Interpretation clarifies the ranges for such penalties and ties such them to prison sentences and the value of underlying bribes.

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