China Enterprises Annual Inspection is cancelled from 1st March 2014

In China, the long run enterprises inspection system ends in March 2014. The State Administration for Industry and Commerce announced that, since 1st March 2014, annual inspections on registered companies will be replaced by companies' annual reports, which should be available to public inquiry. Companies that fake reports or fail to release reports according to requirements will be punished in accordance with laws.

The industrial and commercial authorities will load the enterprises into abnormal operation list if it does not publish annual report in prescribed time limit. If enterprises perform its obligation of reporting in 3 years, they can apply to recover their state to normal, if over 3 years, the authority will permanently put them into ”black list” of serious violation.

According to the plan, it will also promote electronic business licenses in an effort to build a standardized and convenient business registration system suitable for Internet technologies. The State Administration for Industry and Commerce explained that the traditional "more approval less regulation" will be changed to "wide access strict supervision", which will push the government to change their management mode from prior approval, to in and after supervision, which will help to build the market order of wide access and fair competition.