Saturday, January 22, 2011

The Supreme People’s Court’s Interpretation of Several Issues Concerning Specific Application of Law in the Trial of Criminal Cases about Illegal Fundraising (English Version)


The Supreme People’s Court’s Interpretation of Several Issues Concerning  Specific  Application of Law in the Trial of  Criminal Cases about Illegal Fundraising, which was adopted at the 1502nd  meeting of the Judicial Committee of the Supreme People’s Court on November 22nd 2010 , are hereby promulgated and will come into force as of January 4th 2011.
December 13th, 2010                                                              
No. (2010) 18 of Judicial Interpretation

The Supreme People’s Court’s Interpretation of Several Issues Concerning Specific Application of Law in the Trial of Criminal Cases about Illegal Fundraising
 (Adopted at the 1502nd meeting of the Judicial Committee of the Supreme People’s Court on November 22nd 2010)
In order to punish in accordance with laws those criminal activities such as illegal money collection from the public and/or fraud in financing, the judicial interpretation of the several issues concerning the specific application of the law in the trial of criminal cases about illegal fundraising shall be as follows: 
Article 1:  Any conduct of soliciting fund from the social public (including firms and individuals) which is in violation of provision of China financial administration act and meet the following four circumstances at the same time, unless otherwise specified by Criminal Law,   shall be identified as illegally soliciting public deposits or pooling public deposits in disguised form as defined in article 176 of the Criminal Law:
1. Soliciting fund without the approval from competent authorities or through imitating the form of lawful operation;
2. Making publicity to the society through channels like media, presentation conference, flyers or SMS, etc;
3. Promising to refund the principal and interest in kind, in cash or in shares or repay within a certain period of time;
4. Soliciting fund from the social public, namely non-specific object.
Fundraising without publicity to the society but only among families, friends and relatives or among specific persons in a company should not be identified as illegal money collection or disguising for public deposit.
Article 2:  Any one of the following activities which is involved in Article 1.1 of this interpretation shall be convicted as the crime of illegally soliciting public deposits in accordance with the provision of article 176 of the Criminal Law and be punished accordingly:
1.  Illegally soliciting fund by means of principal-refund sales, sublease promise after sales, agreed redemption,  selling fractional property ownership, etc., without the actual content of property sales or not for the purpose of property sales;
2. Illegally soliciting fund by means of transferring forest property and entrusted management;
3. Illegally soliciting fund by means of entrusted planting (cultivation), rent of land for planting (cultivation) or associated planting (cultivation);
4. Illegally soliciting fund in form of commodity buy-back or consignment instead of selling real commodity or providing real service, or not for the purpose of selling commodity or providing service;
5. Illegally soliciting fund by means of fictitious equity transfer or offering fictitious bonds without the actual content of issuing shares and bonds;
6. Illegally soliciting fund by means of pretending to be offshore fund and/or offering fictitious fund without actual content of raising fund;
7. Illegally soliciting fund by means of pretending to be the insurance companies and forging insurance documents without actual content of insurance sales;
8. Illegally soliciting fund in form of buying a share for investment;
9. Illegally soliciting fund in form of entrusted assets management;
10. Illegally soliciting fund under the name of non-governmental organizations or civil society organizations; 
11. Other conducts of illegally soliciting funds.

The English version is translated and provided by Artisan Business Group, Inc., for  a complete 5-page copy of the legal interpretation, contact us today.

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