15 Sept 2016
Online CBA: What are the Real Benefits of Social Good Faith to Enterprises Doing Business in China?
Q: What are the real benefits of social good faith to enterprises doing business in China?
A: According to the Guiding Opinions of the State Council on Establishing and Improving the System of Offering Joint Incentives to Acts in Good Faith and Imposing Joint Punishments against Acts in Bad Faith to Accelerate the Construction of Social Integrity, good integrity enterprises are eligible for the following benefits:
1. Administrative approval “green channel”
When applying for administrative permission, integrity models and administrative counterparts with no bad credit records for three consecutive years are entitled to the use of the “green channel”, “acceptance of application with incomplete information” and other facilitation measures. For eligible administrative counterparts, if application materials other than those required by laws and regulations are incomplete, the application may still be accepted to expedite processing provided they have given written promise to submit all the documents within a stated time.
2. Priority access to public service
In the implementation of arrangements for fiscal fund projects, preferential policies supporting investment promotion and other government preferential policies, priority consideration and greater support will be given to market entities of good integrity. In the areas of education, employment, entrepreneurship and social security, greater support and preference will be given to individuals of good faith. In activities of trading of public resources, extra credit will be given to market entities of good faith in accordance with law and contract.
3. Improved administrative supervision arrangements
Market supervision departments at all levels should classify the subjects of supervision on the basis of their credit record and rating, pay attention to the use of big data, improve operational and post-operational oversight, and provide convenient service to the market entities. For enterprises of good faith that measure up to given conditions, the frequency of routine inspection and special inspection will be optimised.
4. Lower market transaction costs
The departments and units concerned are encouraged to develop good faith incentives such as granting loans based on good track record in tax payment and good credit; financial institutions, commercial sales institutions and other market services institutions are guided to give reference to and make use of the credit information, credits and credit rating results of market entities in granting market entities of good faith preferential treatment and convenience so that those who are trustworthy can find more opportunities and enjoy material benefits in the market.
5. Government will put in a good word for market entities of high integrity
Government departments at all levels should promptly publish information about good faith market entities in their own websites or www.creditchina.gov.cn and put in a good word for these enterprises in and exhibitions or bank-related activities so that good credit becomes an important consideration in the distribution of market resources. Credit investigation institutions should step up the collection of positive information about market entities and give entities of good faith a higher assessment weighting as incentive in industry sectors fraught with integrity issues. Industry associations and chambers of commerce should strengthen integrity building and self-policing and give citation to members of good integrity.
(The HKTDC provides one-on-one China Business Advisory Service free of charge to assist companies in resolving problems encountered when doing business in China. For enquiries and appointments, please call (852) 1830 668 or register online.)