Chapter VI Legal Liability
Article 31Those who, in violation of these Regulations, establish a foreign-funded insurance company or illegally engage in insurance activities shall be banned by CIRC and be investigated for criminal liability in accordance with the provisions of the Criminal Law on the crime of illegally establishing financial institutions, the crime of illegal operation or other crimes. Where such violation is not serious enough for criminal punishment, CIRC shall confiscate the illegal income and concurrently impose a fine of not less than one time nor more than five times the illegal income, or a fine of not less than 200,000 yuan nor more than 1,000,000 yuan if there is no illegal income or the illegal income is less than 200,000 yuan.
Article 32Where a foreign-funded insurance company, in violation of these Regulations, engages in insurance activities exceeding the approved business scope, geographic restriction or types of clients, it shall be investigated for criminal liability in accordance with the provisions of the Criminal Law on the crime of illegal operation or other crimes. Where such violation is not serious enough for criminal punishment, CIRC shall order the foreign-funded insurance company to make corrections and to refund the premiums collected, confiscate the illegal income, and concurrently impose a fine of not less than one time nor more than five times the illegal income, or a fine of not less than 100,000 yuan nor more than 500,000 yuan if there is no illegal income or the illegal income is less than 100,000 yuan. Where the foreign-funded insurance company fails to make corrections within a specified time limit or causes serious consequences, CIRC shall order the foreign-funded insurance company to suspend its business operation within a specified time limit, or revoke its permit to carry on insurance business.
Article 33Where a foreign-funded insurance company, in violation of these Regulations, conducts one of the following activities, CIRC shall order it to make corrections in a specified time limit and impose a fine of not less than 50,000 yuan nor more than 300,000 yuan. If the circumstances are serious, CIRC may order the foreign-funded insurance company to cease accepting new business, or revoke its permit to carry on insurance business:
(1) failing to set up a guarantee fund as in accordance with provisions or using the guarantee fund in violation of the provisions;
(2) engaging in transactions with its associated enterprises in violation of the provisions; or
(3) failing to replenish the registered capital or operating fund as in accordance with provisions.
Article 34Where a foreign-funded insurance company, in violation of these Regulations, conducts one of the following activities, CIRC shall order it to make corrections within a specified time limit. If the foreign-funded insurance company fails to make corrections within the specified time limit, it shall be fined not less than 10,000 yuan nor more than100,000:
(1) failing to submit relevant documents, materials or written reports as in accordance with provisions; or
(2) failing to make public announcements as in accordance with provisions.
Article 35Where a foreign-funded insurance company, in violation of these Regulations, conduct one of the following activities, CIRC shall impose a fine of not less than100,000 yuan nor more than 500,000 yuan:
(1) submitting falsified documents, materials or written reports; or
(2) refusing or hindering supervision and inspection conducted according to law.
Article 36Where a foreign-funded insurance company, in violation of these Regulations, transfers its assets out of the territory of China, CIRC shall order it to transfer back the assets and impose a fine of not less than 20% nor more than the full amount of the assets so transferred.
Article 37Where a foreign-funded insurance company violates relevant Chinese laws, administrative regulations or these Regulations, CIRC may disqualify the senior managerial personnel of the company to serve in China for a specified period of time up to their whole life.
Chapter VII Supplementary Provisions
Article 38Where there are no provisions in these Regulations on the matters concerning the supervision and administration of foreign-funded insurance companies, the Insurance Law of the People's Republic of China, as well as other relevant laws, administrative regulations and other relevant provisions of the State apply.
Article 39These Regulations are mutatis mutandis applicable to the insurance companies established and operated within the mainland by insurance companies of Hong Kong Special Administrative Region, Macao Special Administrative Region and Taiwan region.
Article 40These Regulations shall be effective as of February 1, 2002.
(State Council)
