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This year on February 22, the Standing Committee of the National People’s Congress, revealed a draft bill of amendments to China’s Law Against Unfair Competition (LAUC). The LAUC has not been amended since it came into force in December 1993. The period for public comment on the draft bill ended March 25.
One important change in the draft bill with may employers responsible for actions of their employees who pay a commercial bribe. The current law does not have any provision for liability of an employer for a commercial bribe paid by an employee. It is thus relatively easy for an employer to claim any bribe was purely the action of the individual and thus avoid official penalty to company.
The draft law seeks to change this practice by expressly providing for liability of an employer when an employee pays a commercial bribe. The draft law does allow a company to provide evidence to prove that the employee acted alone, but this may be difficult. Official fines for such bribery are also raised from RMB 200,000 to RMB 3,000,000. Quite an increase.
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