01 Administrative Regulations of Shenzhen Special Economic Zone on Brokers 深圳经济特区经纪人管理条例（2001）

Archived（May 28, 2018）

(Adopted at the ninth meeting of the Standing Committee of the Second Session of the Shenzhen People’s Congress on July 10, 1996

Revised in accordance with the Resolution on Revision of the Administrative Regulations of Shenzhen Special Economic Zone on Brokers at the fifteenth meeting of the Standing Committee of the Third Session of the Shenzhen People’s Congress on April 26, 2002.)

Chapter I General Provisions

Article 1 These regulations are formulated in accordance with basic principles of laws and administrative regulations, and the concrete circumstances of Shenzhen Special Economic Zone (hereinafter referred to as “Special Zone”) to normalize the brokers’ activities, safeguard the lawful rights and interests of parties in brokers’ activities, and maintain the order of market economy.

Article 2 In these regulations,

“broker” means self-employed household, legal person or other economic entity who provides information or acts as intermediary to promote trade of other persons and charge for brokerage in return pursuant to these regulations;

“employee of a broker” means natural person who is engaged by a broker to undertake broker’s activities pursuant to these regulations;

“principal” means entity or individual who entrusts broker to provide service pursuant to these regulations.

Article 3 Unless laws and regulations otherwise require for broker’s activities in spesific trade, broker’s activities within the Special Zone shall be governed by these regulations.

Article 4 The Administration Department of Shenzhen Municipal People’s Government (hereinafter referred to as “municipal government”) for Industry and Commerce is the administrative department in charge of the registration and administration of brokers (hereinafter referred as “administrative department in charge”); all relevant administrative departments of the municipal government shall supervise brokers’ activities of their respective trade according to laws and regulations.

Article 5 The Association of Brokers shall exercise its duties in accordance with these regulations and its Articles of Association under the direction and supervision of the administrative department in charge.

Chapter II Requirements of the Engagement in

Brokering and the Establishment of a Broker.

Article 6 Employee of a broker shall be qualified with necessary knowledge and skill for broker’s activities, and shall attain lawfully certificate of qualification for undertaking broker’s activities in specific field as laws and regulations require.

Article 7 Persons who work outside brokering are allowed to be engaged in broker’s activities for part-time with the permission of units they work in.

Article 8 No one who is found in one of the following cases shall be engaged to undertake broker’s activities:

(1) Having no capacity for civil conduct, or having limited capacity for civil conduct;

(2) Less than three years beginning from the date when one’s punishment due to economic crime has been executed,

(3) Prohibited by laws and regulations to be engaged to undertake

broker’s activities.

Article 9 The establishment of a broker shall be subject to the conditions stipulated in these regulations, and shall be registered by administrative department in charge, and a broker shall acquire business licence, unless laws and regulations otherwise require for the establishment of a broker.

Article 10 The establishment of a Broker as a legal person shall meet the following requirements:

(1) Certain quantity of employees which adapts to the scope of its business;

(2) Other conditions requested by laws and regulations.

A broker as a legal person shall bear its external civil obligations with all its own assets.

Article 11 The establishment of a Broker as a partnership shall meet the following requirements:

(1) Partner shall have more than two years experience in brokering ;

(2) Other conditions requested by laws and regulations.

Partner shall bear unlimited joint and several liabilities for the debt of the Broker as a Partnership.

Article 12 The establishment of an Individual Broker shall meet the following

Requirements:

(1) Applicant has more tan two years experience in brokering;

(2) Applicant is jobless, unemployed, or has resigned or retired;

(3) Other conditions requested by laws and regulations.

Individual broker shall bear its external civil obligations with all his personal assets.

Article 13 Besides broker as a legal person, broker as a partnership and Individual Broker, other economic institutions that run broker’s business with their main business concurrently shall comply with relevant stipulations of these regulations, and their broker’s business shall be approved and registered by administrative department in charge.

Article 14 A broker shall lawfully go through its modification or nullification registration formalities to modify or terminate.

Chapter III Broker’s Activities

Article 15 Brokers shall undertake their broker’s activities within their business scope approved by administrative department in charge.

Article 16 Brokers shall neither provide services for transactions involving Commodities prohibited by state to enter circulation, nor provide services for projects prohibited by state. Brokers shall not provide services for illegal transactions.

Article 17 The principal shall provide true materials regarding the entrusted matter for the broker’s activities. Brokers may resist authorization or terminate agreement in the case that the principal does not provide relevant materials or provides false materials.

Article 18 Brokers may collect brokerage according to agreement with the principal. Unless laws and regulations otherwise require, the standard of brokerage can be covenanted by the broker and the principal.

Article 19 Brokers shall not divert any fees or transaction sums paid in advance by the principal for broker’s activities to any other purpose.

Article 20 Brokers shall not provide false informations regarding the signing of an agreement or false materials involving the transaction. Brokers shall not conceal any material facts involving the transaction.

Article 21 Brokers shall exercise reasonable care to maintain samples and materials provided by the principal, and shall keep the business secret of the principal. Brokers shall not use the business secret of the principal acquired during the course of the provision of broker’s service to undertake any economic activities competing with the principal.

Article 22 Brokers shall not disclose the name or title of the principal to others as required by the principal.

Article 23 Brokers shall not take part in or help to undermine one party’s interest for the other party during its broker’s activities.

Article 24 Brokers shall not conduct transaction with the principal by cheating in the name of providing broker’s service.

Brokers shall not deceit through providing broker’s service.

Article 25 Brokers shall not charge or accept any additional amount except the brokerage.

Article 26 Part-time participant engaged in a broker shall not provide broker’s service for client who has competition relationship with the institution that the participant works for.

Article 27 Brokers shall keep business records of broker’s activities. The records shall contain a general description of the broker’s activities, main contents of the agreement with the principal and the performance.

Article 28 Brokers shall establish account book. The account book shall list all the items requested by accounting rules.

Article 29Brokers shall pay tax and administration fees to for broker’s activities.

Chapter IV Supervision and Administration

Article 30 Administrative department in charge shall exercise according to laws duties and powers as follow:

(1) To carry out and implement laws and regulations, and to

stipulate measures on broker administration;

(2) To train employees of brokers necessarily;

(3) To examine and issue certificate of qualification of broker by self or together with other relevant departments according to laws and regulations;

(4) To examine and approve registration of brokers, and issue business license, and handle modification, nullification registration and annual examination of brokers;

(5) To protect the lawful rights and interests of brokers, and to investigate and deal with illegal broker’s activities according to laws;

(6)To direct and supervise the work of the Broker’s Association;

(7)To supervise the use of the broker risk fund;

(8)To exercise other duties and powers empowered by laws and regulations.

Other administrative departments shall exercise duties and powers on broker supervision and administration according to laws and regulations.

Article 31 Administrative department in charge is entitled to investigate and deal with activities as follow:

(1) Activities conducted in name of a broker without having been duly registered by administrative department in charge and without having obtained business licence;

(2) Broker undertakes activities beyond business scope;

(3) Broker did not conduct modification and nullification registration according to laws;

(4) Person who does not meet the requirements prescribed in these regulations undertakes broker’s activities as employee of a broker; employee of a broker undertakes broker’s activities without having obtained certificate of qualification required by laws and regulations;

(5) Broker provides service for commodities prohibited by state to enter circulation, and project prohibited by state or illegal transaction;

(6) Broker undertakes deceitful activities by taking advantage of the provision of broker’s service;

(7) Broker forges, changes, sells or purchases business transaction documents, broker’s business records or vouchers;

(8) Broker has not paid administration fees according to laws;

(9) Other illegal activities to be investigated and dealt with by administrative department in charge as laws and regulations require.

Article 32 Law enforcement officials of administrative department in charge and other administrative departments are empowered during their law enforcement to request relevant units or persons to provide relevant materials.

Chapter V Broker’s Association

Article 33 Brokers shall set up broker’s Association, which is a self-disciplined union for brokers to be self-constrained and self-managed.

Article 34 Broker’s Association shall mainly exercise following duties and powers:

(1) To carry out national laws, regulations and administrative measures;

(2) To draw up rules on the engagement of brokering;

(3) To convey opinions and requirements of members, and to secure lawful rights and interests of members;

(4) To mediate disputes among members, and to help administrative department in charge and other relevant administrative departments to investigate and deal with illegal broker’s activities;

(5) To collect and manage broker risk fund;

(6) To handle matters under authorization of the administrative department in charge.

Article 35 Broker lawfully established shall join broker’s association, employee of a broker may join broker’s Association.

Article 36 Member of broker’s association shall enjoy rights and fulfill duties according to articles of broker’s association.

Article 37 The general meeting of a broker’s association is the highest organ of power in a broker’s association, and the administrative council is the executive organ of the general meeting. Both duties and powers shall be prescribed in the articles of the broker’s association. The administrative council shall be made up with members appointed by the administrative department in charge and members elected by the broker’s association.

Article 38 The broker’s association shall set up broker risk fund. Brokers having joined the broker’s association shall pay broker risk fund to the broker’s association. In the case that the principal suffers damage due to the negligence of a broker, and the broker’s property is insufficient to compensate, the Broker Risk Fund shall compensate with limited amount.

Article 39 The broker’s association shall establish broker risk fund account, shall earmark the fund for its specified purpose only, and shall not use the fund for other purpose.

Article 40 Detailed measures on the payment, use and management of the broker risk fund shall be prescribed by articles of broker’s association and shall be carried out under the supervision of the administrative department in charge.

Chapter VI Penalty Provisions

Article 41 Broker, in violation of laws, regulations and these regulations, conducts broker’s activities shall bear the cost of the broker’s activities and the risk of the transaction by itself, and reimburse the brokerage. Broker shall compensate damages brought by it to the principal pursuant to laws, regulations and these regulations.

Principal, in violation of laws, regulations and these regulations, shall compensate pursuant to laws, regulations and these regulations the damages brought by the principal to a broker.

Article 42Anyone,who violates Article 6 or Article 8 of these regulations, shall be ordered by the administrative department in charge to stop broker’s activities. The illegal gains shall be confiscated, and a penalty of not less than 1,000 yuan and not more than 5,000 yuan may be concurrently imposed;

Article 43 Anyone, who violates Article 9, Article 13, Article 14 or Article 15 of these regulations shall be punished by the administrative department in charge according to laws and regulations regarding enterprise registration.

Article 44 Violations of Article 16, or Article 24 of these regulations shall be dealt with according to relevant laws and regulations. If there are no stipulations of laws and regulations, the administrative department in charge shall confiscate the illegal gains, and impose a fine of not more than 50,000 yuan; and anyone, who conducts a crime shall be prosecuted by judicial organs pursuant to laws.

Article 45 Anyone, who violates Article 27,or Article 28 of these regulations, shall be warned and ordered to correct within specific period by the administrative department in charge, a penalty of not more than 20,000 yuan may be imposed concurrently.

Article 46 Anyone, in violation of Article 39 of these regulations, shall be investigated for criminal responsibility according to laws.

Article 47 Law enforcement officials of the administrative department in charge and other relevant administrative departments, who abuse their power, neglect their duties or engage in malpractice for personal gain in the course of carrying out these regulations, shall be given administrative sanctions by their respective administrative department in charge, and shall be investigated for criminal responsibility according to laws.

Article 48 If a party is not satisfied with the decision on administrative punishment, he may, within 15 days from receipt of the notice of punishment, apply for reconsideration to the organ for administrative appeal of municipal government. If the party concerned is not satisfied with the reconsideration decision, he may, within 15 days from receipt of the reconsideration decision, bring a suit in a People’s Court. The party concerned may also directly bring a suit in a People’s Court within 15 days from receipt of the notice of administrative punishment.

Chapter VII Supplementary Provisions

Article 49 The municipal government may formulate detailed rules for the implementation of these regulations in accordance with these regulations.

Article 50 These regulations shall enter into force as of January 1, 1997.

Article 51 Brokers having been registered before the implementation of these regulations shall apply for examination and verification to the administrative department in charge before June 30, 1997, otherwise the former certificate and license shall be rendered invalidated.