Articles: CHINA


The Ins and Outs of Employment Background Checks in China

It is common for employers in China to run background checks on job applicants before making an employment offer. Required information may typically include criminal records, educational background, qualifications, and references from previous employers.

Chinese citizens’ criminal records are stored in government databases, which are administered by the PRC Ministry of Public Security and its local counterparts (“Criminal Record Database”). According to relevant laws and regulations, only persons without any criminal convictions may perform certain jobs,and applicants must obtain a Certificate of No Criminal Conviction (“CNCC”) from a local public security bureau before performing such jobs (“CNCC Jobs”).Employers are not allowed to check criminal records directly in the Criminal Record Database. They may either require a job applicant to obtain a CNCC, or run a check via a commercial investigator. Commercial investigations may violate privacy laws and those regarding state secrets so their use is not recommended.

Employers may request relevant diplomas and/or certificates to verify educational backgrounds and qualifications. Of course, diplomas and certificates might be counterfeit, and if necessary, employers may verify their authenticity. It is a general and lawful practice in China for an employer to make an employment decision based on a job applicant’s educational background and qualifications.

With a job applicant’s written consent, an employer may ask for a reference from a previous employer and use the reference to help decide whether to employ the applicant.

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China Draft Rules Propose That Chinese Employee Data Cannot Be Stored Overseas

China has not established comprehensive and systematic personal information protection legislation. The PRC Constitution and the General Principles of the Civil Law of the PRC (1986) both refer vaguely to certain personal rights, but privacy is not expressly provided in them. The Tort Liability Law (2009) does refer to privacy, but (with the exception of medical information) it doesn’t specifically define the types of information that must be kept private. These laws were enacted by the National People’s Congress (NPC) and are supported by various administrative regulations enacted by the ministries. For years, China has been discussing and working on a draft Personal Information Protection Law, and a draft was made available internally among the authorities in 2005, but there is no schedule for promulgation of this law.

The Ministry of Information and Industry of China (MIIT) has published a draft document called Information Security Technology – Guide for Personal Information Protection (the “Draft Guide”). If the Draft Guide is eventually enacted, it will be enacted by the Administration for Quality Supervision, Inspection and Quarantine (AQSIQ) and the Standardisation Administration of China ( SAC). It will not be enacted by the MIIT itself, because it is written in the form of an industrial standard, which fall into the scope of authority of AQSIQ and SAC. It will, however, have legal force.

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New Chinese Legislation Includes Provisions Protecting Personal Information

Two separate acts of legislation have been passed in China to address the protection of citizens’ personal information. An amendment to the Law of the People’s Republic of China on Resident Identity Cards provides additional provisions to protect the personal data contained on the cards. The amendment requires agencies and organizations that process the identity card data to keep the information confidential. Violations of the act could result in possible criminal sanctions, imprisonment, fines or civil liabilities. 

The Regulation of Information Technology of Jiangsu Province (the “Regulation”) serves as a milestone in China’s development toward a national personal information protection law. This law goes into effect on January 1, 2012 and addresses the collection and use of personal information, extending protection beyond individual industry sectors. Those who violate the Regulation face administrative penalties such as fines and criminal sanctions.

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Chinese Ministry of Industry and Information Technology Issues New Data Protection Regulations

The Ministry of Industry and Information Technology of the People’s Republic of China (the “MIIT”) recently issued a regulation entitled, “Several Provisions on Regulating Market Orders of Internet Information Services” (the “New Regulations”). The New Regulations, which will take effect on March 15, 2012, include significant new data protection requirements applicable to Internet information service providers (“IISPs”). Consistent with data protection regimes currently in place elsewhere in the world, IISPs will be required to provide much stronger protection for the personal data they collect from users in China, and will be subject to notice and consent requirements, collection limitations and use limitations. The New Regulations also impose custody, remedy and breach notification obligations.

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China’s New Privacy Regulations Go Into Effect

The Ministry of Industry and Information Technology of the People’s Republic of China’s new privacy regulations entitled, Several Provisions on Regulation of the Order of Internet Information Service Market, have now gone into effect. The new regulation defines the personal information protection requirements applicable to Internet Information Service Providers (“IISPs”). It is the first national level of regulation that provides a definition of “user personal information” and that contains specific obligations and liabilities of IISPs to protect user personal information. Consistent with data protection regimes currently in place elsewhere in the world, IISPs will be required to provide much stronger protection for the personal data they collect from users in China, and will be subject to notice and consent requirements, collection limitations and use limitations.

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China to Include Fingerprints in Citizens’ ID

China will require its citizens to register their fingerprints when applying for ID cards from January 2013 in a bid to curb counterfeit ID cards and ensure faster identification, according to the Ministry of Public Security. The first version of ID cards, launched in 1985, will be prohibited from use from Jan. 1, 2013. According to Huang, citizens applying for ID cards for the first time as well as those applying for replacement cards will be required to have their fingerprints taken. And those still holding valid second-version ID cards can register their fingerprints on a voluntary basis.

The move came after the Standing Committee of the National People’s Congress, China’s top legislature, adopted an amendment to the Resident Identity Card Law last year to require citizens’ fingerprints recorded when they apply for or change ID cards.

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A Push to Protect Personal Data

The State Council is pushing banks and e-commerce companies to better protect people’s personal information by providing them with guidelines. Further, the State Council will help fund new security technologies that promote the development of digital signatures that could replace simple client-selected passwords. Banks and e-commerce companies are supposed to use people’s passwords to protect their information, but passwords are not always the most effective way to protect one’s privacy. “Regulations and laws on personal information protection are urgently needed, as leaking personal information has seriously affected the security of all citizens,” said Lü Benfu, vice dean of the Graduate School of the Chinese Academy of Sciences and an expert in information security. The seventh Amendment to the Criminal Law regulates that “whoever illegally obtains the aforesaid information by stealing or any other means shall, if the circumstances are serious, be punished.” However, no specific definition of the leakage of personal information is stipulated.

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Cabinet Approves Changes to Data Protection Draft Bill
The Executive Yuan in China has approved a draft bill that seeks to address controversies arising from a 2010 amendment to the Personal Data Protection Act. The bill will now be submitted to the Legislature Yuan for final approval. One of the proposed changes in the bill involves personal information gathered without the knowledge or permission of the concerned individuals. The collectors of this kind of data should inform the concerned individuals before the information is processed or used. The 2010 amendment stipulates that the collectors should inform the concerned individuals within one year of the law’s implementation, a requirement that is considered difficult to implement. Partly because of this controversy, the amendment was never put into force despite its promulgation in May 2010.

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One Big Step for Data Protection in China?

The PRC Standardization Administration issued a national standard entitled the “Information Security Technology – Guideline for Personal Information Protection within Information System for Public and Commercial Services” (the Guidelines) that will take effect on February 1, 2013. The Ministry of Industry and Information Technology (MIIT), the regulator of telecom industry in China, first proposed the Guidelines in January 2011 for public consultation. The Guidelines were a response to numerous incidents involving the misuse of personal information in China. Although the Guidelines were proposed by the MIIT and implemented as a national standard, they are intended to regulate all organizations and entities on the protection of personal information. The Guidelines are only applicable to any processing of personal information that involves the use of an “information system” (e.g. a computing system). The Guidelines therefore are quite limited in scope when compared to usual data protection law whereby no distinction is drawn on whether an information system is involved or not. Under PRC law, the Guidelines do not have the force of law because there are no penalties in the event that they are not complied with.

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China’s Evolving Personal Data Privacy Landscape

The first ever national standard on personal data privacy protection has come into force in China. The guidelines, called the Information Security Technology – Guide for Personal Information Protection within Public and Commercial Information Systems (Guidelines), were originally proposed by the nation’s telecoms regulator, the Ministry of Industry and Information Technology in 2011 and subsequently released by the Standardization Administration of China. The Guidelines provide guidance on protecting personal information handled in information systems and applies generally to the private sector. While the Guidelines do not have the force of law, the introduction of a general national standard on personal data privacy protection marks a significant move for China. The China Software Evaluation and Test Centre have announced it is forming a self-regulatory group to play a consultative role in future legislation in the personal data privacy arena. Organizations should take active measures now to prepare their data collection, handling and processing/use practices for compliance with the best practice Guidelines.

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Beijing Prosecutors Arrest 8 In Fake Degree Certificate Scam

Three Beijing-based education companies are under investigation after more than 100 company executives paid nearly 10 million yuan ($1.5 million) only to find out their promised Columbia International Institute degree certificates were worthless, the capital’s Haidian district prosecutors announced Monday.

Eight suspects from three education and training companies were arrested on charges of illegal operation in late May, according to Zhou Zhicheng, a Haidian district prosecutor investigating the case.

Two suspects surnamed Yu and Hu had founded the Bozhiruida Technology and Education Company in 2008, he said. Without any qualifications the company began to enroll students, mostly corporate executives, promising them business degrees from a private institute headquartered in New York, one of the US’s so-called degree mills, Zhou told the Global Times. The degrees are not recognized by either US or Chinese official educational accrediting bodies, Zhou said.

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33 Diploma Mill Suspects Nabbed In Beijing

Beijng police have arrested 33 suspects for allegedly selling fake diplomas and degree certificates and swindling 7.97 million yuan (US$ 1.23 million) out of 339 people, including nearly 200 senior company executives.

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Introduction to China’s Education System and Education Verification
Employers want to find people who are not only well qualified with relevant education background, but also ethical. Therefore, conducting an education background check should be on employer’s priority list, especially because a significant amount of job applicants misrepresent their education background, costing employers time and money to replace unqualified hires. Some of those who don’t have an advanced degree decide to resort to false diploma when they start job hunting. That explains why diploma mills or outright falsified diplomas are so popular among jobseekers. Common ways to confirm a diploma’s authenticity include checking: the Higher Education Graduates Database in China – released by Ministry of Education, the nation’s trusted source for education verification; the

China Academic Degrees and Graduate Education Development Center (CDGDC) – an organization with the independent qualification of legal entity directly under the joint leadership of Ministry of Education and the Academic Degrees Committee of the State Council (ADCSC); with the university directly.

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Call Centre Outsourcing In China – 100% Foreign Ownership Permitted Under New China’s Telecoms Regulatory Regime

In a further push to the development of the outsourcing industry in China, the State Council and the Ministry of Industry and Information Technology recently announced a series of policies which aim to relax foreign investment restrictions on certain telecoms-related activities which would otherwise be subject to China’s fairly stringent restrictions in the telecoms sector.

The new policy, as stated in the State Council’s announcements on 7 April 2010 and 12 August 2010 and in MIIT’s notice of 10 November 2010, is therefore groundbreaking as the policy allows foreign investors to operate call centres in 21 ‘modelcities’ in China on a trial basis, without having to partner with a PRC company. These 21 model cities are Beijing, Tianjin, Shanghai, Chongqing, Dalian, Shenzhen, Guangzhou, Wuhan, Haerbin, Chengdu, Nanjing, Xian, Jinan, Hangzhou, Hefei, Nanchang, Changsha, Daqing, Suzhou, Wuxi and Xiamen.

It remains to be seen whether China will evolve to become a viable option formultinational and foreign companies to set up their call centres.

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The Labor Market Bites Chinese Factories

At a time when China’s wages and benefits are increasing, employers still face a labor shortage — and their potential responses to it may have big implications for China and the rest of the world. In the past, there was an abundant supply of workers willing to work, and therefore employers did not have to pay much or treat employees especially well. However, employers are now the ones getting burned and arecomplaining about a labor shortage because they can’t find workers at the wages they have been paying. On the upside, some employers have begun wondering whether there is a different way to manage labor; developing longer-term relationships with employees, for example. There may also be a new pool of potential workers coming in as China breaks the news that large numbers of new college grads are now earning less than most factory workers. This is shocking in a country that reveres education and expects college graduates to earn way more than low-status factory workers.

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The Asian Talent Market: Challenges and Opportunities

With national and global organizations in growth mode, the pressure on the talent market has increased tremendously, and many employers are unprepared. According to the Universum IDEAL™ Employer Survey 2011, Asian students associate foreign employers with no job security, poor work/life balance, and a competitive and cut-throat environment. Large national employers, on the other hand, are perceived as offering exactly what new graduates are looking for: a stable career with opportunity for growth, market success, competitive benefits and a friendly work environment. Although Asian talent is known to have strong technical skills, there is a low supply of candidates exhibiting the soft skills that employers are looking for, making recruiting the right talent a challenge for 80% of global employers. With an organization’s success depending on the management of the talent supply and the ability to attract and retain the right talent, it is more important than ever for organizations to have strong knowledge of the markets and the students they want to attract. This means fully understanding what their target audience is looking for, their preferences and career goals, but also the perception of the industry, the company’s employer brand and that of the recruitment competitors.

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Cheat Sheet: A Quick Guide to Doing Business in China 

China has the second largest economy in the world, the largest population and the fastest-growing market of any country. While it’s easier now to break into China’s market than it was 10 years ago, the government still plays a large role in controlling business within the country. Expect to have to seek government approval at just about every turn, and find a local lawyer to help you understand the country’s evolving regulations. But don’t forget about U.S. regulations, either, especially the Foreign Corrupt Practices Act. Personal relationships are very important in the Chinese business community-as important as any written document or contract, and such ties can be easily abused or interpreted as bribery. Make sure to keep your relationships on the legitimate side of the law. China has a civil law system, meaning it isn’t bound by stare decisis, the rule that says lower courts must rely on judicial precedent. However, the country is trying to push for more uniform decision-making among its courts. China is also trying to move away from its image as a manufacturing mecca, and promote indigenous innovation.

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What’s Your China Strategy?
China’s cultural phenomenon of rote learning, a focus on grades before experience, and a society that is only now realizing the importance of innovation has caused problems in the job market. So much so, that while 6.6 million university graduates entered the workforce in 2011, 73% of executives in China stated that it would still be tough to recruit top talent, citing ‘skills shortage’ as the top challenge. Australian and Asia-Pacific HR directors who must build a workforce linked to a China expansion strategy should focus on building a competitive edge – talent attraction. Having a strong employer brand is beneficial to increasing the access to talent – 20% more by some accounts. In addition, China has the biggest Internet penetration even though Facebook, Twitter and Youtube (amongst a growing list of around 2,600 sites) are blocked in China. There are home-grown Social Networking Sites that are ideal platforms to connect to your potential employees and build a strong employer brand and businesses are recommended to add ‘social media expert’ to all HR job descriptions.

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Courts Seal Youth Criminal Records 

Beijing courts are preparing for the adoption of a new nationwide criminal law next year, under which some convicted juvenile offenders are to have their criminal records sealed, making it easier for them to apply for jobs or further education. According to the current Criminal Law, amended in 2011, most convicted criminals must report their record when they apply to the military or for a job. The new law would not require those who were under 18 when they committed the crime, and were sentenced to less than five years in jail or to a non-custodial sentence, to tell prospective employers of their conviction, but the employer can still access the record by applying to the police. Some argue this law change is unfair to companies because such a person may be a security risk, while others want to provide those who have corrected their mistakes with a second chance.

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