[Direct answer]In the Beijing area, the core of identifying criminal risks for enterprises is to screen the criminal risk points in all aspects of operation according to four lines: business, positions, financial and taxation data, and personnel. According to Articles 30 and 31 of the Criminal Law of the People's Republic of China, a unit committing a crime shall be subject to a dual punishment system — the unit shall be fined, and the persons directly in charge of the unit and other directly responsible persons shall be sentenced to criminal punishment; the Amendment to the Criminal Law (Twelfth) (implemented on March 1, 2024) also extends the application of crimes such as illegal operation of similar businesses and illegal profiteering for relatives and friends to private enterprises. It is recommended to conduct a criminal compliance check once a year, conduct a special review before making major decisions, and, if necessary, entrust a lawyer to issue a risk list. For details, please refer to the following document:Criminal defense and criminal case filing services.

1. Problem background and typical scenarios

Corporate criminal risks are not exclusive to large enterprises, but permeate the entire business process. Typical scenarios include: operating on the edge of legal boundaries - thinking it's just a grey operation, but it's actually illegal business or attracting traffic for illegal platforms; irregular financial and tax invoices - purchasing invoices to offset costs, which constitutes a crime of false invoicing; insider betrayal - executives establishing competing companies in the same industry or accepting kickbacks from suppliers, which used to be handled as disputes but may now lead to criminal charges; lack of data compliance - being held accountable for over-collecting and selling personal information; and being implicated in the collapse of business partners - providing payment, traffic attraction, and technical services to gambling and pornographic platforms, which is considered a joint crime. Many enterprises only become aware of the risks for the first time when law enforcement agencies visit them. For enterprises and individuals already involved in criminal litigation, they can seek assistance from legal professionals to address these issues.Criminal defense and criminal case filing servicesObtain defense support.

II. Key points of contention

The identification of disputes focuses on four points. Firstly, the criminalization standard for internal corruption in private enterprises: Before the implementation of the Amendment (XII) to the Criminal Law on March 1, 2024, crimes such as illegal operation of similar businesses were mainly applicable to state-owned enterprises, while similar acts within private enterprises were mostly handled as civil disputes; after its implementation, similar acts committed by personnel within private enterprises may also constitute crimes, and the identification standards must be updated. Secondly, the distinction between unit crimes and individual crimes: Only when acts are committed for the benefit of the unit, under the unit's decision-making, and in the unit's name can they be identified as unit crimes, and the nature of the acts directly affects the scope of responsible personnel. Thirdly, the boundary between administrative violations and criminal offenses: The same act may be upgraded to a crime if it meets the standard of serious circumstances, which needs to be judged based on the amount, consequences, and frequency. Fourthly, the point of exposure: There is a significant difference in outcomes between proactive investigation and rectification and passive response after being investigated. For issues involving corporate governance and contract review, reference can be made to relevant provisions.Business and contract dispute resolution services for enterprisesCollaborate to make progress together.

III. Professional analysis by Hengluo Law Firm

Many criminal cases handled by Hengluo Law Firm show that criminal risks often emerge in the most routine situations. In a case of intentional homicide at a concrete mixing station handled by Attorney Liu Liqiang, the defendant, Zhang Daqiang, drove his car at a speed of about 60 kilometers per hour into the laboratory due to a dispute over construction quality, resulting in one death and two injuries. He was eventually sentenced to death for intentional homicide. The lack of a mechanism for resolving workplace conflicts and the uncontrolled management of vehicles and personnel on site escalated the dispute into a serious crime of taking away others' lives. In the case of disseminating obscene materials handled by Attorney Shang Jiangpeng, the defendant was criminally detained for merely reposting three video files on a forum, with a total of about 5,000 views and 1,000 downloads. In the case of operating a gambling house handled by Attorney Zhu Guiying, the defendant was employed by an overseas online gambling platform as a chat streamer, and the live interface was embedded with gambling advertisements and recharge entry points, which led to her being identified as an accomplice and held accountable. The common lesson from these cases is that risk identification must be downgraded to the level of business details and employee behavior. We should check each clause against the crime name, and take the business operation, post responsibilities, fund flow, and data use as the main lines of investigation. This case was handled by Beijing Hengluo Law Firm.Liu LiqiangThe attorney (practice license number: 11101200910454358, subject to the document issued by the judicial administrative organ) acts as the agent.

IV. Practical suggestions and legal basis

The legal basis includes Article 30 (the scope of criminal responsibility of units), Article 31 (the system of double punishment), Article 163 (the crime of accepting bribes by non-state employees), Article 164 (the crime of offering bribes to non-state employees), and Article 271 (the crime of embezzlement) of the Criminal Law of the People's Republic of China (the amendment of the Criminal Law (Twelfth) implemented on March 1, 2024 is the latest amendment); as well as the "Opinions on Establishing a Third-Party Supervision and Evaluation Mechanism for Compliance of Enterprises Involved in Cases" jointly issued by the Supreme People's Procuratorate and other departments (issued in June 2021, and the reform of compliance of enterprises involved in cases was fully implemented in April 2022). Enterprises that meet the conditions can seek lenient treatment through compliance rectification and third-party evaluation in accordance with the law. Practical suggestions: First, establish a risk list based on four lines and update it annually; Second, conduct an annual check on business models, contracts, financial and tax invoices, and data compliance; Third, implement authority separation and traceable approval in key positions such as procurement, finance, and data; Fourth, conduct compliance due diligence on business partners and refuse to provide traffic guidance, payment, and technical services to illegal platforms. The construction of daily compliance systems for enterprises can be combined with the above suggestions.Intellectual property protection and corporate legal servicesCoordinate and promote progress in an integrated manner.

5. Henglu Law Firm's Advice

The most striking feature of corporate criminal risks is that they often go unnoticed in daily operations but can suddenly lead to catastrophic consequences. It is recommended to institutionalize risk identification: in addition to annual audits, special reviews should be conducted before launching new businesses, signing new cooperation agreements, or authorizing new positions. Once you receive inquiries from law enforcement agencies or news that employees have been taken away for investigation, immediately activate the criminal response plan and hire a lawyer. Never handle the matter internally or destroy evidence—destroying evidence itself constitutes a new criminal risk. For enterprises already involved in legal cases, genuine compliance rectification may be considered a mitigating factor in judicial practice, but the rectification must be authentic, verifiable, and capable of withstanding third-party evaluations. Due to significant differences in the legal classification of individual cases, it is advisable to consult professional lawyers as early as possible to clarify the legal status of the case and seek appropriate solutions through legal means.Criminal defense and criminal case filing servicesMake an appointment for an assessment.

VI. Frequently Asked Questions

Q1: If a company has undergone a compliance check, does this mean that there will be no criminal risks and they won't be prosecuted?

This understanding is incorrect. Compliance checkups are a means of identifying and reducing risks, but they do not mean eliminating risks or exempting oneself from liability—enterprises always face dynamic risks brought about by market and legal changes, and no institution can guarantee absolute safety. The value of checkups lies in identifying criminal risk points in business models, financial and tax invoices, data, and job responsibilities in advance and rectifying them in a timely manner, thereby controlling risks at their nascent stage. Even if litigation arises in the future, a genuine and effective compliance system and rectification records may serve as mitigating circumstances. It is recommended to conduct checkups at least once a year, conduct special reviews before making major decisions, and dynamically track changes in laws and regulations, while remaining vigilant against empty rhetoric aimed at ensuring trouble-free operations.

Q2: What materials and information are needed to identify corporate criminal risks?

The core materials include: business license and company bylaws (to confirm the business scope and governance structure), main business contracts and business model descriptions (to determine whether they violate illegal business operations or other charges), financial ledgers and tax declaration materials for the past three years (to verify the accuracy of accounts and invoice compliance), employee rosters and job responsibility descriptions (to investigate the authority of key positions and related transactions), data compliance systems and data collection and use records (to identify personal information risks), business partner lists and due diligence materials (to assess the risk of being implicated), and historical administrative penalties and litigation records. Lawyers usually also interview business, finance, and legal managers to compare the institutional documents with actual operations and identify inconsistencies. The more complete the information is, the more accurate the risk profile will be.

Q3: What is the approximate cost of conducting an enterprise criminal compliance check or hiring a lawyer to conduct an audit?

The fees depend on the size of the enterprise, the complexity of its business, and the depth of the investigation. They are usually determined through negotiations between law firms and enterprises, and may be charged on a project-based or time-based basis. There is no nationwide standard pricing. Investigations of a single business line are relatively simple; for enterprises that are group-based, cross-regional, or involved in data and financial businesses, the workload is large, the cycle is long, and the fees are correspondingly higher. It is recommended to require the law firm to provide a written service plan and fee breakdown before entrusting them, clarifying the scope of the investigation, the deliverables (risk lists, rectification suggestions), and the boundaries of follow-up services. This will help balance the fees against the output and avoid paying for a "stamp-like physical examination".

Q4: How long does it usually take from the start of the enterprise criminal risk investigation to the delivery of the results?

It depends on the scope and depth. A single specialized investigation (such as taxation or data compliance) can typically produce a risk list within two to four weeks; a comprehensive audit covering multiple business lines generally takes one to two months; if it includes the design and implementation of rectification plans and follow-up guidance, the time will be extended accordingly, requiring three to six months and continuous review. For enterprises that have already been involved in cases, the compliance rectification cycle is linked to the judicial process: from initiating rectification, third-party supervision and evaluation to acceptance, it often takes several months, and it is necessary to cooperate with the progress of the case-handling authorities. It is recommended to include risk investigations in the annual plan rather than addressing them only when necessary.

Q5: If a company wants to systematically screen for criminal risks, what is the specific process they should follow?

Five suggestions: First, clarify internal goals and scope—whether for financing due diligence, regulatory compliance, or daily governance—and focus on specific business lines and positions. Establish a dedicated team composed of executives, legal counsel, finance professionals, and external lawyers. Second, collect materials such as contracts, accounting records, regulations, and data logs. Conduct a review-based investigation and staff interviews by lawyers. Third, prepare a risk list organized by business lines, positions, financial and tax data, and personnel. Classify risks into high, medium, and low levels and label them with corresponding criminal charges. Fourth, develop rectification plans for high-risk areas—revise regulations, redesign processes, adjust authority structures, and implement accountability measures—with clear responsibilities and timelines. Fifth, establish annual reviews and dynamic monitoring systems. Conduct special reviews before launching new businesses and embed compliance into decision-making processes.

The above answer is based on the judicial practice in Beijing. The adjudicative opinions in other provinces and cities may vary. For specific cases, please refer to the local rules and evidence situation.

If you are facing similar problems, it is recommended that you consult a professional lawyer as soon as possible with the evidence materials, so as to avoid missing the statutory time limit. →Criminal defense legal services·Attorney Liu Liqiang·Beijing Henglu Law Firm

Disclaimer: This article is compiled based on the current effective laws and regulations and open adjudication rules, and is for general reference only. It does not constitute a formal legal opinion on specific cases. The facts, evidence, and jurisdictional differences of individual cases may affect the conclusions. In the event of a dispute, please consult a practicing lawyer in a timely manner.