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China to strengthen punishments for acts of bad faith

Xinhua | Updated: 2019-07-19 00:33

BEIJING -- China will step up the establishment of a credit-based market regulation mechanism to stimulate acts of good faith and punish acts of bad faith.

The mechanism should cover the whole life cycle of market entities with cross-sectoral, inter-agency and trans-regional regulation, said Lian Weiliang, deputy director of the National Development and Reform Commission (NDRC), at a press conference Thursday.

Entities jointly punished for bad faith will face administrative punishments in the fields of stock issuance, tendering and bidding, financial fund application and preferential tax treatment.

Strict penalties, including market access restrictions, and even permanent exclusion from the market will be meted out to actors of bad faith involved in serious breach of laws.

Institutional violations in key sectors which threaten public security and interests and negatively affect economic and social development, including food and drug safety, ecological environment, production safety, and elderly and childcare care will be more strictly regulated.

Low costs, minimal punishments and limited information disclosure are the underlying reasons why some market players chose to cross the line frequently, Lian said. The mechanism will improve the efficiency of inspection, promote fair competition and reduce transaction costs.

The country also encouraged the applications of the Internet Plus model and technologies such as big data to regulate over acts of bad faith more effectively.

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