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Supervision in and after the Process - Case 6: Market Supervision System Based on the Credit Risk Classification

Article From:   Time:2017/11/21 17:35:27 【Size:B M SPrint

(Provided by China (Tianjin) Pilot Free Trade Zone)

Relying on the market entity credit information publicity system and joint regulation platform, China (Tianjin) Pilot Free Trade Zone (hereinafter referred to as the Tianjin Pilot Free Trade Zone) establishes the joint inspection system of market entity credit risk classification management, market regulation and random sampling, to strengthen the credit constraints on the market and to promote the institutionalization, standardization and sequencing of the market supervision.

I. Main practice

Led by the Tianjin Municipal Market Supervision Committee and participation of 55 municipal administrative departments (see Appendix 1), it is implemented in Tianjin Pilot Free Trade Zone.

(1) Establishing market entity credit information publicity system.

Tianjin Municipal People's Government issued the "Interim Regulations of the Market Credit Information Publicity Management of Tianjin and established market entity credit information publicity system.

1. All kinds of market members should be brought into the publicity. Market credit information publicity system covers a wide range, including various enterprises, individual businesses and farmers' professional co-operatives. 

2. Multiple departments collect the credit information. All 56 municipal administrative departments of Tianjin have the website and provide online service. The market entity credit information occurring in the performance of the duties by the administrative departments is collected to the publicity system and is announced on the portal website. 

3. Collecting multiple types of credit information. The credit information covers 17 items of registration, 56 items of administrative record, 845 items of administrative approval, 3,500 items of administrative punishment, 17 items of performance situation and other 6 items, totaled more than 4,000 items of information. 

4. Establishing the strict information management mechanism. Tianjin Municipal People's Government issued the Notice on Strengthening Collection of Market Credit Information and made the manual for the credit information collection and data submission and normalized the data push procedures and data standard, to ensure the comprehensiveness, timeliness and accuracy of all kinds of information collection. 

(2) The implementation of credit risk classification management.

In May 2015, Tianjin Municipal People's Government issued the Interim Measures for the Market Credit Risk Classification and the Interim Measures for Random Sampling Joint Inspection for Market Regulation, which aims to use the market and joint control platform for credit risk classification management of the market relying on the market entity credit information publicity system.

1. The platform makes classification processing for the collected credit information. The list of operation exceptions, serious illegal enterprises list, the number of administrative punishment cases of market, as well as the credit information of the market receiving the supervision and examination of the administrative departments, should be attached great importance. 

2. Establishing credit risk classification standards. According to the corresponding credit information of the market, the credit risk will be automatically classified as four categories of "Good", "Warning", "Breach", "Serious Breach". "Good" refers to: (1) no administrative punishment credit information; (2) not listed in business exception list, marked as the abnormal state of management or listed in serious illegal enterprises list; (3) good performance and credit record of without bad information; (4) no other bad behavior. "Warning" refers to: (1) only warning on the administrative penalty credit information; (2) with bad information of the good performance and credit record; (3) other types of cases to be listed as a warning. "Breach" refers to: (1) listed in business exception list or marked as abnormal state of operation; (2) with less than five administrative penalties other than warning and with the administrative penalty amount less than 500,000 Yuan; (3) other types of cases listed as a breach according to provisions. "Serious breach" refers to: (1) listed in the serious illegal enterprises list; (2) with more than five administrative penalties other than warning and with the administrative penalty amount more than 500,000 Yuan; (3) ordered to be closed, suspended the business license or permit in accordance with law;(4) with major production safety and food safety accidents to be investigated according to law; (5) other types of cases listed as a serious breach according to provisions.

The four types of "Good", "Warning", "Breach", "Serious breach" are respectively indicated with green, yellow, red and black, which will be made known to public through the market entity credit information publicity platform.

(3) Implementing random sampling joint inspection system and strengthening the supervision of market.

The relevant administrative departments should implement "Random sampling and random inspection by any inspector" for daily supervision and inspection of the entity rated as "Good"; the entities rated as "Warning ", "Breach", "Serious breach" should be listed as the key objects under the supervision and inspection of the relevant administrative departments.

1. Random sampling and random inspection by any inspector with automatic matching. The market entity joint regulation system should be developed. On the basis of the enterprise database of public system and with the enterprise registration number as the index, the enterprises to be inspected will be sampled by computer software as per certain proportion. The database of supervision and inspection personnel of the administrative authority should be established. The law enforcement personnel will be sampled randomly from the database to participate in the joint inspection.

2. One form for an enterprise and all administrative procedures The Directory of the Inspected Items of Random Sampling & Joint Inspection under Tianjin Market Regulation should be formulated (covering 36 administrative organs, 191 items and 526 sub-items to be supervised and inspected). Relying on the Directory and enterprise industry code, the corresponding relation should be established, to form "One form for an enterprise", namely "Form of annual joint inspection items" (see Appendix 2). The supervisory personnel will share the form to implementing the inspection and sign the form.

3. The government leadership and joint inspection. After the "One form for an enterprise" is generated, the Binhai New Area government and the market regulatory department will together with the administrative law enforcement departments establish a joint inspection group to carry out one-off joint inspection on the sampled enterprises. Binhai New Area government is responsible for the leadership; the market supervision department is responsible for coordination; the administrative law enforcement departments are responsible for supervision; they should perform their own functions and coordinate with each other for regulation.

4. Information backfill and results publicity. After random joint inspection, the administrative organs should include the inspection results to the information publicity database. The results will be automatically published and will affect the credit risk classification, so as to realize the closed loop of joint inspection and information publicity. (1) For the enterprises with no problem found, the results will be announced and the credit risk rating should not be adjusted; (2) If the enterprise does not provide cooperation for the inspection and corrects the problems, it will be announced as negative performance and the enterprise credit risk rating should be adjusted to "Warning"; (3) The enterprises cannot be contacted should be listed in exceptions list in accordance with the law and announced, and the enterprise credit risk rating should be adjusted to "Breach"; (4) If illegal problem is found through inspection and need be further investigated, the credit risk rating should be first adjusted to "Warning"; after the administrative punishments are made, the enterprise should be listed in the types of "Breach" or "Serious breach".

II. Practical effect

(1) The implementation of market regulation based on the social credit system.

The establishment of the market entity credit risk classification management system realized the basic function of the information publicity and credit constraints, which laid a solid foundation for "There is always a green light for the law-abiding business, but an illegal behavior will cause all-round limitation" and improved the level and efficiency of the supervision in and after the process. As of 20 October, the market entity credit information platform has collected and announced 7.155 million pieces of information, including 4.646 million pieces of entity registration information, 2.243 million pieces of administrative information for the record, 226,000 pieces of the administrative licensing information, 2,968 pieces of administrative penalty information, 37,000 pieces of performance information and 589 pieces of other credit information. The public system website traffic has reached to 44.889 million person times and the cumulative number of query has reached 172,000 person times. The system has become the important channel for the social public, banks and credit management consulting agencies to know the credit status of the market entities.

(2) The government joint regulation reduced the burden of enterprises.

The establishment of random sampling and joint inspection system promoted the scientific degree, standardization and normalization of the government law enforcement; the administrative organs changed the "Multiple inspections and once inspection for an issue" to the "Joint inspection and once inspection for multiple issues", to avoid repeated examination and reduce the burden of enterprises. The enterprises in the free trade zone generally reflect that the random sampling & joint inspections improve the efficiency and reduce the burden of enterprises. It is not only a joint supervision and centralized inspection, but also the on-site office and focused services, which embodies the idea of "no interference in case of no need and no giving up in case of need".

III. Working thought of next step

The first is to further revise and improve the Directory of Market Entity Credit Information Publicity and perfect the market entity credit information collection & publicity mechanism; the credit information publicity will be gradually expanded to the market entity credit information mastered by the industrial associations and other social organizations and judicial organs.

The second is, according to the Notice of General Office of the State Council on Promoting the Random Sampling and Normalizing the Supervision in and after the Process (GBF [2015] No. 58), to improve the joint inspection system of "Random sampling and random inspection", the market entity joint regulation system and the directory of supervision and inspection items of the market regulation random sampling and joint inspection, to  carry out the random sampling and joint inspection more effectively and more targeted.

The third is to explore the establishment of cross-functional linkage incentive disciplinary measures and the whole process credit restraint mechanism from market entry to exit, to strengthen the punishment on illegal enterprises and to encourage enterprises to conduct business according to the laws and regulations.

Appendix 1: 56 Municipal Administrative Departments involved in the Credit Information Collection

Appendix 2: Data Sheet of Random Sampling and Joint Inspection of Tianjin