The Supreme People's Procuratorate ("SPP") has recently issued the Circular on Issuing the 14th Batch of Guiding Cases of the Supreme People's Procuratorate (the "Circular").
The Circular reads that five cases, including the supervision of a false lawsuit where a Guangzhou-based real property company deceptively obtained a payment order for enforcement, the supervision of a false lawsuit where a Wuhan-based investment company deceptively obtained the mediation document, and the supervision of a false lawsuit where a Shaanxi-based industrial company deceptively obtained a notarial certificate for enforcement, are hereby released as the 14th batch of guiding cases. Among others, the Circular reveals that for the purpose of embezzling State-owned assets, the Guangzhou-based real property company, the lender, entered into the lending agreement worth of CNY2.51846 million and of CNY16 million respectively with two subordinate companies of a State-owned agricultural commerce company to create unreal debts, and then obtained in a deceptive manner a valid payment order from the court, adding that they reached a settlement agreement shortly after the issuance of the order and used the physical object that were undervalued to pay off the debt during the enforcement process, which resulted in the loss of State-owned assets worth of over CNY100 million. This supervisory case conveys a clear message that procuratorial organs shall lawfully supervise those false lawsuits where the parties concerned maliciously collude with each other to forge debts and then use undervalued assets to repay the debts during the enforcement process after they have deceptively obtained the payment order from courts, in an attempt to embezzle State-owned assets.