[Direct answer]In the Beijing area, when an enterprise internally discovers clues of commercial bribery, it should first establish a compliance investigation procedure and then decide whether to refer the case. According to Article 7 of the Anti-Unfair Competition Law of the People's Republic of China on the prohibition of commercial bribery, and the provisions of the Criminal Law of the People's Republic of China on the crime of accepting bribes by non-state employees and the crime of offering bribes to non-state employees, the internal investigation must be conducted within legal boundaries to avoid infringing on employees' privacy or constituting illegal evidence collection. It is recommended that the compliance or legal affairs department take the lead in fixing financial anomalies and transaction vouchers, and, if necessary, entrust lawyers to issue legal opinions and coordinate with criminal procedures. For more details, please refer to the following link:Business and contract dispute resolution services for enterprises.

I. Problem Background and Typical Scenarios

Business bribery often occurs in the procurement, sales rebate, channel cooperation, and bidding and tendering processes. Typical scenarios include: employees accepting kickbacks from suppliers and concealing the transactions; transferring benefits through third-party consulting fees and service fees; channel providers disguising rebates as "promotion fees"; and management fabricating contracts to embezzle company funds. Many enterprises, after discovering clues, are eager to "settle the matter privately" or make public accusations, only to fall into a passive situation due to improper evidence collection or reputation infringement. Standardized internal investigations are not only compliance requirements, but also the basis for subsequent civil claims or criminal reports. For issues involving the construction of an enterprise's legal and compliance system, it is recommended to combine it with the following aspects:Intellectual property protection and corporate legal services.

II. Key points of contention

There are three key points of contention in the internal investigation. Firstly, the boundaries of investigation authority: companies have the right to access employees' work emails, financial accounts, and approval records, but excessive monitoring of employees' private communications may infringe on their right to privacy, and the legality of the evidence is questionable. Secondly, differences in legal qualification: the boundaries between civil commercial bribery and criminal offenses depend on the amount, the identity of the subject, and the subjective intent. Thirdly, the handling methods: the connection between internal disciplinary actions, civil claims, and criminal reports requires assessing the sufficiency of evidence and the commercial impact. Improper handling may easily lead to secondary disputes such as infringement of reputation rights and labor disputes. For cases involving creditor's recourse, reference can be made to relevant provisions of the Civil Code of the People's Republic of China.Creditor-debtor relations and enforcement case services.

III. Professional analysis by Henglue Law Firm

Based on practical experience in handling corporate compliance and commercial disputes, the most common mistake in internal investigations of commercial bribery is "emphasizing conclusions and neglecting procedures". Henglu Lawyers usually advise enterprises to follow a three-step approach: First, the compliance department should fix financial anomalies, retrieve contracts, invoices, bank statements, and approval chains, and form a preliminary evidence book to avoid tipping off the suspects. Second, distinguish between disciplinary violations, civil infringements, and suspected criminal offenses. For those meeting the standard for filing a case, promptly liaise with the economic investigation departments of public security organs. For those that do not constitute crimes, recover improper benefits through civil litigation. Third, improve compliance systems and employee integrity agreements to prevent recurrence. When handling such matters in the Beijing area, enterprises should pay particular attention to the legality of evidence collection and the standardization of reporting materials to prevent procedural defects from affecting criminal case filing. For special compliance issues, follow-up measures can be taken accordingly.Special services and other case-related services.

IV. Practical Suggestions and Legal Basis

The legal basis includes Article 7 (Prohibition of Commercial Bribery) and Article 19 (Legal Liability) of the Anti-Unfair Competition Law of the People's Republic of China (amended on April 23, 2019); Article 163 (Bribe-taking by Non-State Workers) and Article 164 (Bribery of Non-State Workers) of the Criminal Law of the People's Republic of China (amended on December 26, 2020); and the provisions of relevant judicial interpretations on the standards for initiating prosecution. Practical suggestions: Establish a reporting and investigation system, clarify investigation authority and confidentiality requirements; fix financial and transactional evidence to avoid damaging the original carriers; report suspected crimes promptly and cooperate with economic investigation departments; recover losses through breach of contract or unjust enrichment lawsuits for cases that do not constitute crimes. For cases involving criminal and civil cross-overs, relevant provisions can be combined accordingly.Criminal defense and criminal case filing services\n Ensure the smooth transition between different procedures or processes.

5. Henglu Law Firm's Advice

Internal investigations should avoid "qualifying the facts first and then collecting evidence" or unauthorized monitoring. It is recommended that enterprises: First, establish systems in advance, and clearly prohibit commercial bribery and the obligation to cooperate with investigations in employee handbooks and integrity agreements; Second, comply with procedures, limiting investigations to work accounts and official records, and exercising caution when involving private communications, with lawyers providing oversight as necessary; Third, handle cases in a tiered manner, disciplining violators according to established rules, promptly reporting criminal cases, and pursuing civil compensation separately; Fourth, prioritize confidentiality and anti-retaliation to prevent evidence loss and reputational damage. For cases requiring coordination with criminal proceedings, it is necessary to consult professional lawyers as soon as possible to avoid procedural delays.

VI. Frequently Asked Questions

Q1: If commercial bribery is discovered within the company, can we investigate it ourselves, and would that be illegal?

Companies have the right to conduct internal investigations within the scope of their work authority, but they must operate within legal boundaries. According to Article 7 of the Anti-Unfair Competition Law, commercial bribery is illegal in itself. When conducting investigations, companies may review official emails, financial ledgers, and approval records, but excessive monitoring of employees' private communications may infringe on their right to privacy, resulting in evidence being inadmissible or even triggering infringement lawsuits. Investigations should primarily rely on fixed written and electronic data, and avoid coercive interrogations or illegal searches. Whether accountability can be imposed depends on the legality of the evidence and the clarity of the facts, rather than a mere promise. It is recommended that legal departments or lawyers design investigation plans to ensure that the methods used are legal and the conclusions are reliable.

Q2: What evidence needs to be collected for an internal investigation?

The core evidence includes: contracts involving suspected bribes, invoices and payment vouchers (proving the transfer of benefits), bank statements and transaction records (tracking the flow of funds), emails, WeChat messages, and approval records (proving collusion and concealment), third-party "consulting fees" and "service fees" contracts (identifying disguised purposes), as well as internal reporting materials and audit reports. The evidence should be organized around the "abnormal benefits - causality - subjective intent" framework. It is important to preserve the original evidence carriers and promptly notarize or seal electronic evidence to prevent deletion or tampering. If there is sufficient material, it is advisable to prepare both civil claims and criminal reports simultaneously.

Q3: How much does it cost to hire a lawyer to conduct a compliance investigation?

The attorney's fees depend on the scope of the investigation, the workload, and whether it involves criminal matters. They are usually charged on a per-project or hourly basis, with the specific fees subject to the contract terms and there being no standard pricing. If the case subsequently proceeds to litigation or criminal representation, fees will be charged separately according to the corresponding standards. For internal corporate investigations, which are compliance projects, the costs are relatively manageable, with the focus on plan design and evidence verification. It is recommended to clarify the service boundaries within the company's budget (whether it includes only investigation and evidence collection or also includes reporting to the authorities and seeking compensation) to avoid cost overruns due to scope expansion. It may be advisable to conduct a compliance audit first and then decide whether to proceed with an in-depth investigation.

Q4: How long does it usually take to handle a tip-off of commercial bribery from its discovery to its resolution?

The duration of internal investigations depends on the complexity of the clues: simple verification of accounting anomalies may take several weeks to complete; investigations involving multiple entities and cross-year interest chains often require several months. If the evidence is sufficient to enter the criminal process, the initial investigation and subsequent investigation by the public security economic investigation department may take more than half a year; the trial of civil cases is another matter. Overall, from the discovery of clues to their handling, it usually takes months. It is recommended to conduct investigations and handling in parallel: fix the evidence while assessing the necessity of reporting the case, to avoid the loss of evidence due to delay or exceeding the relevant statute of limitations, which may affect the effectiveness of accountability.

Q5: If I discover an employee who has accepted bribes, what should I do first?

It is recommended to proceed in four steps: First, seal relevant financial books, contracts, and electronic records, and restrict the involved personnel from accessing core data to prevent the destruction of evidence; Second, have the compliance or legal department preliminarily sort out the flow of funds and abnormal transactions, and form a clue report; Third, determine whether the case meets the standards for criminal prosecution. If it does, promptly entrust a lawyer to handle the case with the Economic Crime Investigation Bureau as soon as possible. If not, handle it through internal disciplinary measures and civil compensation; Fourth, improve the integrity system and supervision process, and plug management loopholes. Throughout the entire process, attention should be paid to confidentiality and legal evidence collection, and when necessary, let lawyers supervise the entire process.

The above answer is based on the judicial practice in Beijing. The adjudication guidelines 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, to avoid missing the statutory time limit. →Business and commercial legal services·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. If you encounter disputes, please consult a practicing lawyer in time.