China Adopts Law to Combat Corruption Abroad

Adopted by the Standing Committee of the National People's Congress on November 6, 2026, the law consists of 47 articles across six chapters and entered into force on the date of its promulgation. It regulates the prevention and punishment of cross-border corruption, international anti-corruption cooperation, corporate integrity and compliance, and legal liability for violations.

Scope of the Law

The law defines cross-border corruption as encompassing several categories of conduct, including:

bribery of foreign public officials and officials of international public organizations by Chinese citizens and organizations, as well as by foreign individuals and organizations within China;
bribery of Chinese public officials and persons closely associated with them, state organs and organizations by foreign individuals and organizations, as well as the related acceptance of bribes;
other corruption-related violations and crimes committed abroad by Chinese citizens and organizations, including abuse of power, misuse of official positions and improper transfers of benefits;
other corrupt acts committed wholly or partly outside China where their consequences occur wholly or partly within the country;
the flight abroad of persons suspected of corruption and the cross-border transfer of corruption-related assets.

The law is therefore not limited to the bribery of foreign officials by Chinese companies. It also covers corrupt conduct by foreign individuals and organizations in China, offences committed abroad by Chinese citizens and organizations, and the cross-border movement of corruption-related assets.

Oversight of Public Officials

The law provides for stronger oversight of public officials to prevent cross-border corruption and the flight of corruption suspects abroad.

In particular, the National Commission of Supervision, together with other competent authorities, is required to strengthen oversight and enforcement in cases where public officials acquire foreign nationality, obtain permanent residence status or secure long-term residence permits abroad in violation of applicable rules.

Such restrictions are already established under Chinese legislation. For example, Article 31 of the Law of the People's Republic of China on Governmental Sanctions for Public Officials provides that acquiring foreign nationality or obtaining the relevant residence status abroad in violation of applicable rules results in removal from office or dismissal from public service.

The new law also provides for improvements to the system under which public officials report their overseas bank deposits and investments. China already has rules requiring certain categories of leading officials to report personal matters and assets. These include information on overseas deposits and investments held by the officials themselves, their spouses and children living with them. Concealment of such information may result in disciplinary sanctions under the conditions prescribed by law.

In addition, the new law requires the establishment and improvement of early-warning mechanisms to identify risks of corruption suspects fleeing abroad or transferring corruption-related assets across borders, mechanisms to prevent such activities, and mechanisms for holding those responsible accountable.

When investigating corruption cases, supervisory and law enforcement authorities may decide to impose exit restrictions on suspects in accordance with legally prescribed conditions and procedures. Such decisions are enforced by immigration authorities. The restrictions must be lifted promptly when they are no longer necessary.

Corporate Integrity and Compliance

A separate chapter of the law addresses integrity and compliance requirements for companies engaged in cross-border business operations. These requirements apply to:

Chinese companies that have established branches or subsidiaries abroad or conduct overseas investment activities;
branches and subsidiaries of foreign companies established in China.

Companies are required to establish and improve integrity and compliance management systems, ensuring that compliance requirements are incorporated throughout the decision-making, implementation and oversight of their business operations.

In particular, the law establishes the following requirements:

internal anti-corruption policies and procedures – companies must ensure the effective operation of their integrity and compliance management systems, promptly investigate and address identified violations, and take appropriate corrective measures. Anti-corruption requirements must be integrated into business decision-making and implementation processes;
organizational arrangements for compliance – Chinese companies engaged in cross-border business operations must establish integrity and compliance functions or appoint dedicated personnel, taking into account their size, business scope and corruption risks. Separate compliance procedures may be developed for overseas branches and subsidiaries, and dedicated compliance officers may be assigned to overseas operations, with their responsibilities and working procedures clearly defined;
corruption risk assessment – companies must identify and assess risks associated with cross-border business operations, monitor those risks, provide timely warnings about identified threats and take appropriate response measures. They must also improve their risk control mechanisms based on assessment results;
internal reporting mechanisms – companies must establish and improve internal channels for reporting violations. Where signs of cross-border corruption are identified, the relevant information must be reported to supervisory or law enforcement authorities in accordance with the law;
financial controls and internal audit – companies must ensure the authenticity and completeness of accounting records and financial statements. The use of financial and accounting practices to commit, conceal or disguise cross-border corruption is prohibited. Chinese companies must also strengthen financial management, accounting controls and internal audits within their cross-border business units and overseas operations;
third-party due diligence and oversight – companies must conduct due diligence on third-party organizations and individuals they engage, exercise ongoing oversight and implement mechanisms to prevent associated corruption risks. Third parties acting on behalf of a company must comply with its integrity and compliance standards. The use of third parties to engage in cross-border corruption is expressly prohibited;
anti-corruption training – companies must provide integrity education to employees and strengthen their awareness of ethical business conduct. Chinese companies must also provide integrity and compliance training to employees of their cross-border business units and overseas operations to ensure that they understand and comply with corporate compliance requirements.

Additional requirements apply to state-owned enterprises. They must strengthen corruption risk controls over key overseas positions, major financial resources and significant projects. Measures provided for under the law include:

directly appointing financial managers to overseas operations;
rotating employees assigned to overseas positions;
implementing conflict-of-interest avoidance mechanisms.

Liability for Violations

The law provides for several types of liability for cross-border corruption:

criminal liability – where the conduct constitutes a crime under the Criminal Law of the People's Republic of China;
administrative liability – for violations of administrative regulations, including possible penalties for directly responsible managers and other responsible personnel of organizations;
disciplinary sanctions – for public officials;
civil liability – where the conduct causes financial loss or other damage.

Penalties imposed on organizations and individuals for violations of the law must be entered into their credit records in accordance with applicable national regulations. Illegally obtained assets, including any resulting proceeds and gains, are subject to confiscation, recovery or restitution.

The law also specifies circumstances affecting administrative penalties and disciplinary sanctions.

In particular, aggravating circumstances include:

repeated acts of cross-border corruption;
committing another violation after previously being held liable;
refusal to return illegally obtained assets;
causing serious harm to state or public interests;
retaliation against whistleblowers and witnesses.

Mitigating circumstances may include voluntary surrender, cooperation with investigations, the return of illegally obtained assets, and providing information about corruption offences committed by others.

Separate measures apply to obstruction of investigations, including refusal to provide evidence and the concealment, falsification or destruction of evidence. Depending on the circumstances, such conduct may result in administrative penalties or criminal liability.

Where companies fail to fulfil their integrity and compliance obligations, the competent authorities may order them to rectify the violations within a specified period. If a company refuses to comply with the order, the following measures may be imposed:

suspension of relevant business activities;
suspension of business operations for rectification;
revocation of relevant business licences or permits.

Government Mechanisms for Combating Corruption

The law establishes a national mechanism for combating cross-border corruption, led by the National Commission of Supervision. The mechanism brings together law enforcement authorities and government bodies responsible for foreign affairs, justice, commerce, finance, auditing, anti-money laundering, state-owned assets supervision and other areas of government regulation.

Its main responsibilities include assessing the overall situation regarding cross-border corruption, developing relevant policies and guidelines, coordinating law enforcement and judicial activities, and improving mechanisms for identifying and preventing corruption risks.

Competent government authorities are required to monitor corruption risks in specific sectors and strengthen supervision in areas particularly vulnerable to cross-border corruption. Industry associations and chambers of commerce are expected to support their members in developing integrity and compliance systems.

Specific provisions address the detection of suspicious cross-border financial transactions. Anti-money laundering authorities may investigate transactions indicating possible cross-border corruption and refer relevant materials to supervisory and law enforcement authorities. Audit, tax and financial regulatory authorities are also required to report information indicating possible corruption.

The law provides for the use of big data, artificial intelligence and other information technologies to integrate information from different sources, identify suspicious transactions, assess corruption risks and collect evidence. At the same time, government authorities and their personnel must protect the confidentiality of information obtained in the course of their duties, including trade secrets, personal information and privacy.

Investigation of Offences and International Cooperation

The law strengthens mechanisms for investigating cross-border corruption, tracing suspects and recovering illicit assets.

Chinese supervisory and law enforcement authorities may request information and evidence from organizations and individuals during investigations. Organizations and individuals are required to cooperate and provide truthful information. In major cross-border corruption cases, Chinese authorities may also request cooperation from foreign companies and other organizations on the basis of reciprocity.

As part of international cooperation, Chinese authorities may request legal assistance from foreign countries, including assistance with:

locating suspects and obtaining information about individuals, property and financial accounts;
obtaining witness testimony, documents and electronic evidence;
conducting searches and other procedural measures;
seizing and freezing assets, enforcing confiscation orders, and recovering and returning illicitly obtained property.

Mechanisms for returning persons who have fled abroad may include extradition, transfer of sentenced persons, deportation, prosecution abroad and other procedures provided for by law.

The law also establishes restrictions on the activities of foreign authorities within China. Without the consent of the competent Chinese authorities, foreign institutions, organizations and individuals are prohibited from conducting cross-border corruption investigations or other related law enforcement activities in China, either directly or through third parties. Organizations and individuals located in China are likewise prohibited from providing evidence, data or other assistance to foreign authorities in such investigations without the required consent.

The law also allows China to take countermeasures against foreign countries that impose discriminatory restrictions on Chinese citizens and organizations under the pretext of combating corruption or through the improper extraterritorial application of their domestic laws, in violation of international law and to the detriment of China's sovereignty, security and development interests. Such measures may be taken in accordance with national legislation, including the Anti-Foreign Sanctions Law of the People's Republic of China.

In addition, the law establishes the right of organizations and individuals to report cases of cross-border corruption. Competent authorities must protect the confidentiality of such reports, while persons providing valuable information may receive protection and rewards in accordance with applicable regulations.