Circular of the China Insurance Regulatory Commission on Seeking Public Comments on the Provisions of the China Insurance Regulatory Commission on Administrative Penalty Procedures (Draft for Comment)
Circular of the China Insurance Regulatory Commission on Seeking Public Comments on the Provisions of the China Insurance Regulatory Commission on Administrative Penalty Procedures (Draft for Comment)
Circular of the China Insurance Regulatory Commission on Seeking Public Comments on the Provisions of the China Insurance Regulatory Commission on Administrative Penalty Procedures (Draft for Comment)
September 30, 2016
With a view to further improving the administrative penalty procedures of the China Insurance Regulatory Commission (the "CIRC"), the CIRC has drafted the Provisions of the China Insurance Regulatory Commission on Administrative Penalty Procedures (Draft for Comment) which are hereby promulgated for public comments. The public may provide feedback through the following channels:
1. Give comments by logging into http://www.chinalaw.gov.cn and entering "System of Seeking Comments for Draft Regulations and Rules" on the left-hand side of the homepage.
2. Send comments by e-mail to: law@circ.gov.cn.
3. Send comments by post to: Legal Affairs Department of the China Insurance Regulatory Commission at No.15 Financial Street, Xicheng District, Beijing Municipality (postal code: 100033), with the words "comments on the Provisions of the China Insurance Regulatory Commission on Administrative Penalty Procedures" indicated on the envelope.
4. Send comments by fax to: 010-66011873.
The period for feedback will end on October 30, 2016.
Provisions of the China Insurance Regulatory Commission on Administrative Penalty Procedures (Draft for Comment)
Chapter I General Provisions
Article 1 These Provisions are formulated in accordance with the Law of the People's Republic of China on Administrative Penalties (the "Law on Administrative Penalties"), the Insurance Law of the People's Republic of China (the "Insurance Law") and other applicable laws and administrative regulations in order to regulate and ensure the implementation of administrative penalties by the China Insurance Regulatory Commission (the "CIRC") and its resident offices (the "Resident Offices") in accordance with the law, maintain the insurance market order and protect the legitimate rights and interests of insurance institutions, insurance asset management institutions, insurance intermediate agencies, representative offices of foreign insurance institutions in China, insurance practitioners and other organizations and citizens (the "Parties concerned").
Article 2 Where any of the Parties concerned violates the laws, administrative regulations or the provisions of the CIRC concerning insurance management, the CIRC and the Resident Offices shall investigate and handle the violation in accordance with the law, and impose the administrative penalties as follows in accordance with the law:
1. issue a warning;
2. impose a fine;
3. confiscate the illegal earnings;
4. restrict the business scope;
5. order to cease accepting new business;
6. order to suspend business and to make rectification;
7. revoke the business license;
8. remove the representative offices of foreign insurance institutions in China;
9. cancel the post-holding qualification;
10. order to remove or replace the chief representatives of the representative offices of foreign insurance institutions in China;
11. prohibit the Party concerned from entering the insurance sector; or
12. other administrative penalties as specified by laws and administrative regulations.
When imposing the administrative penalties as stated in the preceding paragraph, the CIRC and the Resident Offices shall follow the procedures specified herein, unless otherwise stipulated by the CIRC.
Where the CIRC and the Resident Offices fail to provide a legal basis or comply with the statutory procedures, the administrative penalties they have imposed shall be invalid.
Article 3 The CIRC and the Resident Offices shall comply with the principles as follows when imposing administrative penalties:
1. fairness, openness and impartiality;
2. protecting the legitimate rights and interests of the Parties concerned;
3. combining penalty imposition and education;
4. clear facts, irrefutable evidence, accurate determination of the nature of an offense, accurate application of the legal basis and proper imposition of penalties; and
5. legitimate procedures.
Article 4 The CIRC and the Resident Offices shall implement the withdrawal system in accordance with the law when imposing administrative penalties.
Where any of the regulators has a relation of direct interest or any other relation with the Party concerned, and such relation may affect the fairness of law enforcement, such regulator shall withdraw from the case.
Article 5 The CIRC and the Resident Offices shall implement the system under which the processes of case initiation, investigation, hearing and decision-making are separated pursuant to the provisions of the CIRC when imposing administrative penalties.
Article 6 The CIRC and the Resident Offices shall inform the Parties concerned of the facts, grounds and bases for the decision and their legitimate rights before rendering any administrative penalty decision.
Article 7 The Parties concerned enjoy the rights of statement and of defense against the administrative penalties which are imposed by the CIRC and the Resident Offices; where the Parties concerned are dissatisfied with the administrative penalties, they have the right to apply for administrative reconsideration or to file an administrative lawsuit in accordance with the law.
Where the administrative penalties illegally imposed by the CIRC and the Resident Offices have caused harm to the Parties concerned, the Parties concerned have the right to claim compensation in accordance with the law.
Article 8 The CIRC and the Resident Offices must fully listen to the opinions of the Parties concerned and review the facts, grounds and evidence provided by the Parties concerned; and shall adopt the facts, grounds and evidence provided by the Parties concerned if they are tenable.
Article 9 For the purpose of these Provisions, insurance institutions refer to the insurance companies and their branches which are established upon approval of the insurance regulatory authorities and registered in accordance with the law.
For the purpose of these Provisions, insurance asset management institutions refer to insurance asset management companies and their branches which are established upon approval of the insurance regulatory authorities and are registered in accordance with the law.
For the purpose of these Provisions, insurance intermediate agencies refer to the insurance agencies, insurance brokerage agencies and insurance assessment agencies and their branches.
Chapter II Jurisdiction
Article 10 The Resident Offices are responsible for imposing administrative penalties within their respective jurisdictions in accordance with the law on the branches of insurance companies and their employees, as well as insurance intermediate agencies and their employees that commit any illegal insurance acts, and imposing administrative penalties within their respective jurisdictions in accordance with the law on other insurance institutions and persons that commit any illegal insurance acts pursuant to the relevant provisions of the CIRC.
Article 11 The Resident Offices are responsible for imposing administrative penalties within their respective jurisdictions in accordance with the law if any of the following illegal acts is found:
1. establishment of insurance companies without permission;
2. illegal engagement in commercial insurance business activities;
3. establishment of insurance asset management companies without permission; or
4. illegal engagement in insurance agency or brokerage business activities.
The Resident Offices shall impose administrative penalties against the aforementioned illegal acts in accordance with the Insurance Law, the Measures for the Clampdown of Illegal Financial Institutions and Illegal Financial Operations and the relevant provisions of the CIRC.
Article 12 The Resident Offices shall report the imposition of the following administrative penalties to the CIRC for approval:
1. revocation of any of the business licenses which are issued by the CIRC; and
2. cancelation of any of the post-holding qualifications which are verified and approved by the CIRC.
Article 13 The CIRC is responsible for jurisdiction over the illegal insurance acts which are not subject to the jurisdiction of the Resident Offices.
Article 14 The CIRC may directly investigate and punish the illegal insurance acts which are subject to the jurisdictions of the Resident Offices, or appoint the Resident Offices to deliver the documents on investigation into and punishment for the illegal insurance acts which are subject to the jurisdiction of the CIRC.
The Resident Offices shall timely report the relevant situation to the CIRC when they carry out the foregoing work under the appointment of the CIRC.
Article 15 Any institution engaging in any illegal insurance act in a place other than its domicile shall be subject to the jurisdiction of the Resident Office at the place where such illegal act is found.
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September 30, 2016
With a view to further improving the administrative penalty procedures of the China Insurance Regulatory Commission (the "CIRC"), the CIRC has drafted the Provisions of the China Insurance Regulatory Commission on Administrative Penalty Procedures (Draft for Comment) which are hereby promulgated for public comments. The public may provide feedback through the following channels:
1. Give comments by logging into http://www.chinalaw.gov.cn and entering "System of Seeking Comments for Draft Regulations and Rules" on the left-hand side of the homepage.
2. Send comments by e-mail to: law@circ.gov.cn.
3. Send comments by post to: Legal Affairs Department of the China Insurance Regulatory Commission at No.15 Financial Street, Xicheng District, Beijing Municipality (postal code: 100033), with the words "comments on the Provisions of the China Insurance Regulatory Commission on Administrative Penalty Procedures" indicated on the envelope.
4. Send comments by fax to: 010-66011873.
The period for feedback will end on October 30, 2016.
Provisions of the China Insurance Regulatory Commission on Administrative Penalty Procedures (Draft for Comment)
Chapter I General Provisions
Article 1 These Provisions are formulated in accordance with the Law of the People's Republic of China on Administrative Penalties (the "Law on Administrative Penalties"), the Insurance Law of the People's Republic of China (the "Insurance Law") and other applicable laws and administrative regulations in order to regulate and ensure the implementation of administrative penalties by the China Insurance Regulatory Commission (the "CIRC") and its resident offices (the "Resident Offices") in accordance with the law, maintain the insurance market order and protect the legitimate rights and interests of insurance institutions, insurance asset management institutions, insurance intermediate agencies, representative offices of foreign insurance institutions in China, insurance practitioners and other organizations and citizens (the "Parties concerned").
Article 2 Where any of the Parties concerned violates the laws, administrative regulations or the provisions of the CIRC concerning insurance management, the CIRC and the Resident Offices shall investigate and handle the violation in accordance with the law, and impose the administrative penalties as follows in accordance with the law:
1. issue a warning;
2. impose a fine;
3. confiscate the illegal earnings;
4. restrict the business scope;
5. order to cease accepting new business;
6. order to suspend business and to make rectification;
7. revoke the business license;
8. remove the representative offices of foreign insurance institutions in China;
9. cancel the post-holding qualification;
10. order to remove or replace the chief representatives of the representative offices of foreign insurance institutions in China;
11. prohibit the Party concerned from entering the insurance sector; or
12. other administrative penalties as specified by laws and administrative regulations.
When imposing the administrative penalties as stated in the preceding paragraph, the CIRC and the Resident Offices shall follow the procedures specified herein, unless otherwise stipulated by the CIRC.
Where the CIRC and the Resident Offices fail to provide a legal basis or comply with the statutory procedures, the administrative penalties they have imposed shall be invalid.
Article 3 The CIRC and the Resident Offices shall comply with the principles as follows when imposing administrative penalties:
1. fairness, openness and impartiality;
2. protecting the legitimate rights and interests of the Parties concerned;
3. combining penalty imposition and education;
4. clear facts, irrefutable evidence, accurate determination of the nature of an offense, accurate application of the legal basis and proper imposition of penalties; and
5. legitimate procedures.
Article 4 The CIRC and the Resident Offices shall implement the withdrawal system in accordance with the law when imposing administrative penalties.
Where any of the regulators has a relation of direct interest or any other relation with the Party concerned, and such relation may affect the fairness of law enforcement, such regulator shall withdraw from the case.
Article 5 The CIRC and the Resident Offices shall implement the system under which the processes of case initiation, investigation, hearing and decision-making are separated pursuant to the provisions of the CIRC when imposing administrative penalties.
Article 6 The CIRC and the Resident Offices shall inform the Parties concerned of the facts, grounds and bases for the decision and their legitimate rights before rendering any administrative penalty decision.
Article 7 The Parties concerned enjoy the rights of statement and of defense against the administrative penalties which are imposed by the CIRC and the Resident Offices; where the Parties concerned are dissatisfied with the administrative penalties, they have the right to apply for administrative reconsideration or to file an administrative lawsuit in accordance with the law.
Where the administrative penalties illegally imposed by the CIRC and the Resident Offices have caused harm to the Parties concerned, the Parties concerned have the right to claim compensation in accordance with the law.
Article 8 The CIRC and the Resident Offices must fully listen to the opinions of the Parties concerned and review the facts, grounds and evidence provided by the Parties concerned; and shall adopt the facts, grounds and evidence provided by the Parties concerned if they are tenable.
Article 9 For the purpose of these Provisions, insurance institutions refer to the insurance companies and their branches which are established upon approval of the insurance regulatory authorities and registered in accordance with the law.
For the purpose of these Provisions, insurance asset management institutions refer to insurance asset management companies and their branches which are established upon approval of the insurance regulatory authorities and are registered in accordance with the law.
For the purpose of these Provisions, insurance intermediate agencies refer to the insurance agencies, insurance brokerage agencies and insurance assessment agencies and their branches.
Chapter II Jurisdiction
Article 10 The Resident Offices are responsible for imposing administrative penalties within their respective jurisdictions in accordance with the law on the branches of insurance companies and their employees, as well as insurance intermediate agencies and their employees that commit any illegal insurance acts, and imposing administrative penalties within their respective jurisdictions in accordance with the law on other insurance institutions and persons that commit any illegal insurance acts pursuant to the relevant provisions of the CIRC.
Article 11 The Resident Offices are responsible for imposing administrative penalties within their respective jurisdictions in accordance with the law if any of the following illegal acts is found:
1. establishment of insurance companies without permission;
2. illegal engagement in commercial insurance business activities;
3. establishment of insurance asset management companies without permission; or
4. illegal engagement in insurance agency or brokerage business activities.
The Resident Offices shall impose administrative penalties against the aforementioned illegal acts in accordance with the Insurance Law, the Measures for the Clampdown of Illegal Financial Institutions and Illegal Financial Operations and the relevant provisions of the CIRC.
Article 12 The Resident Offices shall report the imposition of the following administrative penalties to the CIRC for approval:
1. revocation of any of the business licenses which are issued by the CIRC; and
2. cancelation of any of the post-holding qualifications which are verified and approved by the CIRC.
Article 13 The CIRC is responsible for jurisdiction over the illegal insurance acts which are not subject to the jurisdiction of the Resident Offices.
Article 14 The CIRC may directly investigate and punish the illegal insurance acts which are subject to the jurisdictions of the Resident Offices, or appoint the Resident Offices to deliver the documents on investigation into and punishment for the illegal insurance acts which are subject to the jurisdiction of the CIRC.
The Resident Offices shall timely report the relevant situation to the CIRC when they carry out the foregoing work under the appointment of the CIRC.
Article 15 Any institution engaging in any illegal insurance act in a place other than its domicile shall be subject to the jurisdiction of the Resident Office at the place where such illegal act is found.
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