Measures for the Compliance Management of Central Enterprises

Measures for the Compliance Management of Central Enterprises

Measures for the Compliance Management of Central Enterprises
(Issued by Order No. 42 of the State-owned Assets Supervision and Administration Commission of the State Council on August 23, 2022, and coming into force on October 1, 2022)

Chapter I General Provisions

Article 1 These Measures are developed in accordance with the Company Law of the People's Republic of China, the Law of the People's Republic of China on the State-owned Assets of Enterprises, and other relevant laws and regulations for the purposes of thoroughly implementing Xi Jinping's thought on the rule of law, carrying out the strategic plan for the comprehensive rule of law of the country, furthering the construction of central enterprises under the rule of law, propelling central enterprises to strengthen compliance management, effectively preventing and controlling risks, and providing a strong guarantee for deepening reform and high-quality development.

Article 2 These Measures shall apply to central enterprises for which the State-owned Assets Supervision and Administration Commission of the State Council (hereinafter referred to as the “SASAC”) performs investors' duties as authorized by the State Council.

Article 3 For the purposes of these Measures, “compliance” means that an enterprise's business management activities and employees' performance of duties comply with the applicable laws and regulations of the state, regulatory provisions, industry standards, international treaties and rules, the company's bylaws and relevant rules and regulations, and other requirements.
For the purposes of these Measures, “compliance risk” means the possibility of causing legal liability, economic or reputation losses, or other negative effects by any regulatory violation committed by an enterprise or any of its employees in the process of business management.
For the purposes of these Measures, “compliance management” means the organized and planned management activities carried out by an enterprise, including developing compliance rules, improving an operation mechanism, cultivating the compliance culture, and strengthening supervision and accountability, among others, for the purpose of effectively preventing and controlling compliance risks, which are oriented to improving business management in compliance with the applicable laws and regulations and target at the enterprise's business management activities and employees' performance of duties.

Article 4 The SASAC shall be responsible for guiding and supervising the compliance management of central enterprises, assessing and evaluating the development and effectiveness of the compliance management system, and hold those liable for regulatory violations in accordance with the relevant provisions.

Article 5 The compliance management of a central enterprise shall comply with the following principles:
(1) Adhering to the leadership of the Communist Party of China. It shall maximize the leading role of the enterprise's Party committee (leading Party members' group), implement the relevant requirements of the strategic plan for the comprehensive rule of law of the country, and follow the Party's leadership throughout the whole process of compliance management.
(2) Adhering to comprehensive coverage. Compliance requirements shall be embedded in all fields and links of business management throughout the whole process of decision-making, implementation, and supervision, and implemented by various departments, entities, and all employees, so as to achieve multi-party cooperation and connection between upper and lower levels.
(3) Adhering to clear rights and responsibilities. It shall, in accordance with the requirements that “business management must include compliance management,” specify the duties of business and functional departments, the compliance management department, and the supervision department, strictly implement the compliance responsibilities of employees, and seriously investigate the liability for regulatory violations.
(4) Adhering to pragmatic and efficient management. It shall establish and improve a compliance management system in line with its actual conditions, highlight the management of key fields, key links, and important personnel, and effectively enhance management efficiency by making full use of big data and other information-based means.

Article 6 A central enterprise shall provide necessary conditions for compliance management in such aspects as organization, personnel, funds, and technology, so as to ensure the orderly implementation of the relevant work.

Chapter II Organization and Duties

Article 7 The Party committee (leading Party members' group) of a central enterprise shall maximize the leading role of controlling the general direction, managing the overall situation, and promoting implementation, promote the enterprise's strict compliance with and implementation of compliance requirements, and constantly improve the enterprise's business management in compliance with the applicable laws and regulations.
A central enterprise shall strictly abide by the rules and regulations of the Party, and the working body for Party building of the enterprise shall, under the leadership of the Party committee (leading Party members' group), perform the corresponding duties in accordance with the relevant provisions and promote the effective implementation of the relevant regulations and rules of the Party.

Article 8 The board of directors of a central enterprise shall maximize the role of specifying strategies, making decisions, and preventing risks, and mainly perform the following duties:
(1) Deliberating and approving the basic compliance management rules, system building plans, and annual reports, among others.
(2) Conducting research and deciding on major compliance management issues.
(3) Promoting the improvement of the compliance management system and evaluating its effectiveness.
(4) Deciding on the setup and duties of the compliance management department.

Article 9 The management of a central enterprise shall maximize the role of planning business operation, emphasizing implementation, and enhancing management, and mainly perform the following duties:
(1) Drafting the plan for the establishment of the compliance management system and organizing the implementation thereof after the approval of the board of directors.
(2) Drafting basic compliance management rules, approving annual plans, among others, and organizing the development......