China Regulatory Brief: New Rules for VAT General Taxpayers Status, Draft Amendments to Patent Law Released

April 6, 2015 Posted by China Briefing Reading Time: 4 minutes

SAT Adjusts Management Rules for General VAT Taxpayer Status

On March 30, the State Administration of Taxation (SAT) released new rules for general value-added tax (VAT) taxpayers, which took effect on April 1. The new rules have substantially simplified the process to obtain the VAT general taxpayer status. Under the new rules, taxpayers may become a VAT general taxpayer by submitting the tax registration certificate and an application form to the local tax bureau. The tax bureau will then check the tax registration information and finish the registration. Previously, the application procedure also included an interview, an on-site inspection and the submission of a VAT general taxpayer verification form and fapiao purchase licenses.

China Releases Draft Amendments to the Patent Law

On April 1, China’s State Intellectual Property Office (SIPO) released the “Draft Amendments to the Patent Law,” which is currently open to public comment. The draft states that where the online service provider knew or ought to have known of a patent infringement conducted by its users but failed to take immediate measures, such as deleting and disconnecting relevant links, it is jointly and severally liable for civil damages. Meanwhile, the draft is to increase the minimum validity period for design patents from the previous 10 years to 15 years. The upcoming new Patent Law is seen as another step by China towards a sound intellectual property protection system.

Draft Version of the Commodity Distribution Law Released

On March 31, the Ministry of Commerce released the draft version of the “Commodity Distribution Law,” which sets operation rules for distributors and business operators. According to the Draft, the organizers of sales promotion should display the reasons, sales rules, promotion period and other relevant information. Also, business operators that are engaged in direct sales need to obtain the direct sales operation license and establish a sound information display system. Multi-level marketing organizations shall be marked as illegal pyramid schemes.

Tianjin Adjusts its Minimum Wage Levels for 2015

On April 1, the Tianjin Human Resources and Social Security Department released its monthly and hourly minimum wage levels for 2015, which took immediate effect. Accordingly, the monthly minimum wage in Tianjin has been adjusted to RMB 1,680 from RMB 1,850, while the hourly minimum wage has been adjusted to RMB 18.5. At the time of writing, 11 provinces and regions have released their wage standards for 2015, including Shanghai, Beijing and Shenzhen. For the first time in China, the minimum monthly wage has reached RMB 2,000 (US$322), in both Shanghai and Shenzhen.

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