China-Singapore Jingwei, December 12 According to the State Administration of Financial Supervision and Administration, the State Administration of Financial Supervision drafted the "Implementation Measures for Administrative Punishment Discretion (Draft for Comments)" (hereinafter referred to as the "Measures"), aiming to standardize the exercise of administrative punishment discretion, promote strict and fair law enforcement, and maintain industry order.
The State Administration of Financial Supervision pointed out that the "Measures" consist of four chapters and 31 articles, mainly including the following:
The first is to strictly regulate law enforcement behavior. Clarify the definition of discretion in punishment, and the exercise of discretion in punishment shall follow basic principles such as statutory punishment, proportionality of punishment, and legality of procedures. Clarify the applicable rules such as "treating the old with light" and determining the statute of limitations.
The second is to refine the discretionary order and applicable circumstances. Clarify the basic connotations of mitigated, lighter, moderate, and heavier punishments. Implement the requirements of the "Administrative Punishment Law of the People's Republic of China" (hereinafter referred to as the "Administrative Punishment Law"), and further refine the applicable circumstances of non-punishment, commutation of punishment, lenient punishment, and heavier punishment. Clearly determining the responsibility of personnel shall comprehensively examine factors such as the parties' job responsibilities, their relevance to the illegal conduct, and the actual harmful consequences;When punishing multiple responsible persons, the priority of responsibility shall be distinguished.
Among them, the "Measures" make it clear that in any of the following circumstances, heavier punishment shall be imposed in accordance with the law:
1) Serious violations of prudential business rules, which have caused or may cause cases or major risk events;
2) Seriously violating the provisions on fair market competition, affecting the order and stability of the financial market;
3) Seriously harming consumer rights and interests, with a high degree of social concern and a vile impact;
4) Failure to cooperate with regulatory law enforcement in accordance with law;
5) The same responsible entity is subject to an administrative punishment by the State Administration of Financial Supervision or its dispatched agencies, or is ordered to make corrections, and again commits the same type of illegal conduct that violates the same certain basis;
6) Where the institution's internal controls are seriously lacking or seriously ineffective, and the illegal conduct involves a wide range of issues, has a large degree of impact, or has a general or group character;
7) The number of occurrences of the illegal conduct, the duration is long, the amount involved is large, or the illegal business accounts for a relatively large proportion;
8) Inducing, instigating, or coercing others to violate the law or bear legal responsibility on their behalf;
9) Retaliating against whistleblowers, witnesses, inspectors, or other supervisory staff;
10) Other situations where the nature is heinous and the circumstances are serious.
The third is to standardize the applicable standards for fines and confiscation of illegal gains. Clarify the standards for the range of fines for leniency, moderation, and severity in the banking and insurance industries, as well as the criteria and calculation methods for determining unlawful gains. When calculating unlawful gains, the amount that has already been returned by the parties in accordance with law shall be deducted from the unlawful gains, and the relevant bills, account books, and other relevant bills, account books, and other taxes and other lawful necessary expenses that can be proved by the parties may be deducted.
Among them, the Measures stipulate that, in principle, the range of fines in the banking industry shall be determined according to the following standards:
1) Where the statutory range of fines is between 50,000 and 500,000 RMB, the fines shall be mitigated, moderate, and heavier in accordance with the standards of 50,000 to 200,000 yuan (excluding tens of thousands of yuan to 350,000 yuan (excluding tens of thousands of yuan to 500,000 yuan).
2) Where the statutory range of fines is between 100,000 and 300,000 yuan, the fines shall be mitigated, moderate, and heavier respectively in accordance with the standards of 100,000 to 150,000 yuan (excluding tens of thousands of yuan to 250,000 yuan (excluding tens of thousands of yuan to 300,000 yuan).
3) Where the statutory range of fines is between 200,000 and 500,000 yuan, the fines shall be light, moderate, and heavier in accordance with the standards of 200,000 to 300,000 yuan (excluding tens of thousands of yuan to 400,000 yuan (excluding tens of thousands of yuan to 500,000 yuan).
4) Where the statutory range of fines is between 500,000 and 2,000,000 RMB, the fines are to be mitigated, moderate, and heavier in accordance with the standards of 500,000 to 1,000,000 RMB (excluding tens of thousands of RMB to 1,500,000 RMB) (excluding RMB tens of thousands to 2 million RMB).
In principle, the range of fines imposed by the insurance industry shall be determined according to the following criteria:
1) Impose a lighter fine, where the amount of the statutory minimum fine is greater than and less than 40% of the statutory maximum fine;
2) Moderate fines, which are imposed at the maximum statutory fine amount of 40% but not more than 70%;
3) Heavy fines, imposing fines within 70% or more of the legally-prescribed maximum fine amount and not exceeding the legally-prescribed maximum fine.
Fourth, in accordance with the requirements of the "Opinions of the General Office on Further Standardizing the Formulation and Management of Administrative Discretion Benchmarks", it is clarified that each supervision bureau can reasonably refine and quantify the order, range and applicable circumstances of administrative penalties within its jurisdiction in combination with the local economic and social development situation. Where the application of the Measures may be obviously improper or unfair, or the objective circumstances of the application of the penalty discretion benchmark have changed, the application may be adjusted. Where the discretion to impose punishment is abused, sanctions are to be given in accordance with law, and where a crime is constituted, criminal responsibility is pursued in accordance with law.
The State Administration of Financial Supervision mentioned that the newly revised Administrative Penalty Law stipulates that "administrative organs may formulate discretionary standards for administrative penalties in accordance with the law and standardize the exercise of discretionary powers for administrative penalties." The discretionary standards for administrative punishments shall be announced to the public." The formulation of the Measures is an important measure for the SAMR to implement the Administrative Penalty Law, and the relevant content involving discretion has been refined.
For example, in terms of the retroactive statute of limitations, the statute of limitations for prosecution involving financial security and harmful consequences is extended to five years, and the criteria for judging the continuous state and continuing state of illegal acts are clarifiedIn terms of the application of discretionary orders, refine the specific application circumstances of non-punishment, commutation of punishment, lenient punishment, and heavier punishment, and improve the operability of law enforcement;In terms of the application of the types of penalties, taking into account the high frequency of use of fines and confiscation of illegal gains, the discretionary range standards for fines, and the criteria for determining and calculating illegal gains are clarified. In terms of strengthening self-restraint, legal responsibility is to be pursued in accordance with law for violations of law and discipline such as abuse of power, twisting the law for personal gain, and dereliction of duty in the exercise of discretion in punishment.
The State Administration of Financial Supervision emphasized that the Measures clarify the connotation and specific application circumstances of different discretionary orders, and stipulate the range of fines and penalties that are used more frequently to improve the operability of law enforcement. Considering the complexity of punishment practice, reserve a certain amount of discretionary space, and allow the discretionary scale to be determined based on the specific circumstances of the case in complex situations such as the simultaneous existence of multiple different types of discretionary circumstances, so as to avoid "one-size-fits-all" rigidity in law enforcement. In addition, if the clear application of the Measures may be obviously improper or unfair, or if the objective circumstances of the application of the penalty discretion basis change, the application may be adjusted. (Zhongxin Jingwei app).
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