环球律师事务所-风险与合规管理指引（中国篇）（英）-17页_300kb

Risk & Compliance Management in China: Summary

This report provides a comprehensive overview of corporate risk and compliance management in China, covering legal frameworks, liability implications, compliance strategies, digital transformation, and recent trends.

Legal and Regulatory Framework

• Corporate risk and compliance management is foundational for sustainable business development and is governed by laws such as the Criminal Law, Company Law, Anti-Unfair Competition Law, Anti-Monopoly Law, Personal Information Protection Law, and Data Security Law.
• Key regulatory bodies include Public Security Bureaus, People's Procuratorates, State Administration for Market Regulation, and Cybersecurity Administration of China, among others.
• Definitions and processes are outlined in guidelines like the Measures for Compliance Management of Centrally-Governed Enterprises, emphasizing risk identification, evaluation, and accountability.
• Obligations include establishing compliance structures, systems, and monitoring mechanisms, with a focus on centrally-governed enterprises and data protection requirements.

Liability

• Civil Liability: Deficiencies in risk management may lead to civil liability if they infringe on third-party rights, such as in cases of unfair competition or employee rights violations.
• Administrative Liability: Undertakings face fines, operational suspensions, or license revocations for compliance failures, as seen in cases involving loan mismanagement or data breaches.
• Criminal Liability: Approximately 150 unit crimes under the Criminal Law hold companies criminally liable if committed on their behalf, with directors and senior management potentially facing dual penalties.
• Liability for Governing Bodies/Senior Management: Breaches can result in civil compensation, administrative fines, or criminal charges if they contribute to criminal or administrative violations.

Corporate Compliance

• Corporate compliance defense strategies include demonstrating internal controls to avoid unit liability, as seen in cases like DiDi's fine and promotions for compliance reforms by the People's Procuratorates.
• Recent cases highlight failures, such as DiDi's massive fine for cybersecurity violations and China National Knowledge Infrastructure's antitrust penalties.
• Government and state-owned enterprises have specific obligations, including establishing compliance systems and cultivating compliance culture.

Digital Transformation

• Digital technologies like AI, blockchain, and data analytics are covered under laws like Cybersecurity Law and Personal Information Protection Law, with requirements for robust security measures and ethical governance.
• Blockchain services require registration and security protocols, while AI governance follows principles emphasizing risk prevention and ethical guidelines.

Update and Trends

• Key legislative developments include the implementation of the Measures for Compliance Management of Centrally-Governed Enterprises (October 2022) and updates to anti-money laundering and data protection laws.
• Trends involve increased focus on digital compliance, corporate compliance officers, and pilot programs for leniency based on compliance improvements.
• Enforcement priorities include anti-bribery, antitrust, and data protection, with rapid legal changes reflecting evolving regulatory landscape.