All you need to know about the Official List of Dishonest Persons Subject to Enforcement – What is it and what is important about it?
Doing business with a Chinese on the List of Dishonest Persons Subject to Enforcement? Man, you’re really courageous.
What is the List of Dishonest Enforcees or List of Dishonest Persons Subject to Enforcement?
The List of Dishonest Persons Subject to Enforcement is an official list of people who are enforced by law to pay back money but escape from law enforcement or even violently resist it.
Why does China establish the system of the list of dishonest judgment debtors?
In China, the difficulty in enforcing court judgments has been a big problem for many years. Before 2016, if someone in China (let’s say his name was Xiaoming) owed others money and refused to pay the money back, he might get sued to court. Of course, judges would support the debtee or creditor and require Xiaoming to pay the money back in a certain period of time. However, if Xiaoming continued to refuse paying the money back, there would be basically nothing that could happen to him. There was no sophisticated social credit system and minor penalties from the government. Therefore, among cases enforced and decided by courts all over China from 2008 to 2012, in which judgment debtors were in possession of property, over 70% of debtors escaped, evaded or violently resisted enforcement. Therefore, when dealing with enforcement matters in China, Chinese people, as well as foreign businessmen, often criticize the effectiveness of China’s legal environment. This hurts everyone who wants to do business in China.
In this case, the Supreme People’s Court in China declared a full-scale battle on this situation, claiming to implement a plan to resolve the problem in two to three years. Hence the List of Dishonest Persons Subject to Enforcement.
How does the List of Dishonest Persons Subject to Enforcement work?
According to law, now people who are on the List of Dishonest Persons Subject to Enforcement are NOT allowed to perform any of the following activities:
(1) Traveling by plane, sleeper car on a train, or second-class on a ship;
(2) Accommodating or making consumption in multi-star-rated hotels, restaurants, night clubs, golf courses, etc.;
(3) Purchasing real-estate property, or building new houses, or renovating homes, or decorating houses in a luxurious manner;
(4) Renting expensive office buildings, hotels apartments, or other office premises;
(5) Purchasing cars that are not necessary for business;
(6) Going on tours or vacation;
(7) Sending children to private schools with expensive tuition;
(8) Spending a large sum to purchase insurance wealth management products;
(9) Traveling on any seats of any trains of G-prefixed electric multiple units (High-speed railways) or any seats of first-class or higher of any other EMU trains, and committing other acts of consumption not necessary for his/her daily life and work.
Because of these inconveniences in daily life and work, a much larger proportion of debtors started to pay their debts. The establishment of the system of the List of Dishonest Persons Subject to Enforcement is an important step in building a society of good faith and credit.
What if my Chinese business partner is on the List of Dishonest Persons Subject to Enforcement?
Before he is removed from the list, just walk away.
How can I know if the company I am dealing with or the person I am dealing with is on the List of Dishonest Persons Subject to Enforcement?
If you know Chinese language well, you can get on the official websites of all local courts in China and search for any judgment information that may contain the company’s name or your business partner’s name.