China imposes harsher restrictions on defaulters

People who fail to fulfill court orders will face travel, financial and employment restrictions, said the Supreme People's Court (SPC) here Thursday.

The SPC has signed a memorandum with six central government departments and China Railway Corporation to impose harsher restrictions on defaulters, said Jiang Bixin, vice president of the SPC, at a press conference here.

They will be banned from flying and traveling in upper-class sleeper train compartments, as well as taking positions as legal representative, member of the board, member of the board of supervisors and senior executive of a company, Jiang said.

Besides restrictions on traveling and employment, the defaulters will face constraints when applying for a loan or opening a credit card.

When a corporation becomes a defaulter, its legal representatives, chief executives and those directly responsible for fulfilling the obligation will be subject to the same restrictions as individual defaulters, according to Jiang.

Refusing to implement court judgements has become quite rampant in China, he said.

"About 70 percent of debtors do not willingly fulfill court judgements. This not only harms legal interests of obligees but also social morals and mutual trust among people," he said.

By Wednesday noon, there were 55,920 on the SPC's blacklist of defaulters, about 46,500 individuals and 9,400 corporations.

The SPC will work with police and regulators of banks, state-owned enterprises, civil aviation, and business, Jiang said.

The central government departments involved in this move are the Ministry of Public Security, the State-owned Assets Supervision and Administration Commission (SASAC), the State Administration for Industry & Commerce (SAIC), China Banking Regulatory Commission (CBRC), Civil Aviation Administration (CAA) and the general office of Central Commission for Guiding Ethic and Cultural Progress.

The SPC will update the list of defaulters to all cooperative departments so that they can implement restrictive measures accordingly.

Police will check the identification of defaulters for courts and other regulatory agencies.

The SASAC and CAA will supervise four state-owned airline companies to stop listed defaulters from booking tickets, while China Railway Corporation will work to stop them from booking upper-class sleeper compartments.

The SAIC will make sure its local branches access the court list and stop defaulters from taking banned posts. In China, such employment information is required to be registered at SAIC offices.

The CBRC will supervise the banks that sign agreements with the SPC to access the court list and implement the restrictive terms.