Special Provisions On Penalties For Price Violations During The Period Of Abnormal Fluctuation Of Market Price (Draft For Comments)

Recently, the National Development and Reform Commission (NDRC) published the Special Provisions on Penalties for Price Violations in the Period of Abnormal Market Price Fluctuation (Draft for Comments) (hereinafter referred to as the Special Provisions) on its website. Recently, the relevant person in charge of the National Development and Reform Commission was interviewed by the reporter and explained the legislative background, main characteristics and relevant contents of the Special Provisions.

1、 Why should the Special Provisions be formulated?

A: According to the deployment of the State Council, the National Development and Reform Commission and local price authorities at all levels have recently increased efforts to rectify the price order of agricultural products, investigated and exposed a number of typical cases. In our inspection, we found that although the price legislation has made great progress in recent years, and there are laws to follow, the existing laws and regulations on price supervision and inspection cannot fully meet the needs of supervision during the period of abnormal price fluctuations, mainly including:

First, the punishment is not enough to educate and punish the lawbreakers operator . The behaviors of driving up prices and colluding with price hikes during the period of abnormal price fluctuations are far more harmful than the illegal behaviors in general. However, the current laws and regulations on price supervision do not distinguish between special periods and general periods in terms of punishment, which cannot well reflect the principle of equal punishment, nor is it enough to educate and punish offenders.

Second, the law enforcement procedures do not meet the needs of supervision during the period of abnormal price fluctuations. In the period of abnormal price fluctuations, in order to stop and effectively investigate price violations in a timely manner, it is necessary to simplify the law enforcement procedures and strengthen the inspection means under the premise of ensuring fair procedures, which requires some special provisions.

Third, the punishment object is limited to operators, which is not conducive to strengthening the supervision of other market participants. Other units and individuals other than operators may also engage in fabricating and disseminating price rise information and other illegal acts. However, according to the current price supervision laws and regulations, the punishment object is only limited to operators, and this problem should be solved by formulating Special Provisions.

In addition, the definition of price hikes and other behaviors also needs to be further refined. Therefore, it is necessary to formulate a Special Regulation in combination with the particularity of price supervision during the period of abnormal price fluctuations.

2、 Where is the "special" of the Special Provisions?

The special provisions, as opposed to the general provisions, refer to the legal provisions that apply special procedures and penalties to specific acts in special periods. Specifically, the Special Provisions have the following particularities compared with general price supervision laws and regulations: First, they are only applicable under special conditions. General price laws and regulations are applicable to supervision under normal conditions, while the Special Provisions are applicable to periods of abnormal price fluctuations. Second, it is only aimed at specific illegal acts. The existing laws and regulations on price supervision, such as the Price Law and the Provisions on Administrative Penalties for Price Violations, have made relatively comprehensive provisions on various illegal acts, while the Special Provisions only target several types of illegal acts, such as malicious hoarding, price hikes, collusion in price increases, etc. Third, the punishment intensity is different. Compared with the existing price supervision laws and regulations, the Special Provisions have increased the punishment for price violations. Fourth, the law enforcement procedure is special. In order to stabilize abnormal fluctuations in market prices in a timely manner and safeguard the rights and interests of consumers and social public interests, the Special Provisions put more emphasis on the timeliness and effectiveness of law enforcement procedures, thus simplifying some law enforcement procedures and adding necessary law enforcement measures.

3、 How to understand the startup procedure of the Special Provisions?

In order to prevent the abuse of laws and regulations and damage the legitimate rights and interests of relevant market subjects, the Special Provisions specifically stipulate the starting procedure, that is, only when the market prices of important goods and services fluctuate abnormally, which may have a significant impact on the people's lives and enterprise production, with the consent of the price department of the State Council or the people's governments of provinces, autonomous regions and municipalities directly under the Central Government, Only then can the Special Provisions be applied to investigate and deal with price violations. In this sense, the Special Provisions are in a state of preparation in general. Only when the legal conditions are met and approved by the competent authorities in accordance with the law, can the price authorities at all levels launch the Special Provisions and enforce the law in accordance with the law.

It should be pointed out that the important goods and services mentioned in Article 2 of the Special Provisions generally refer to those goods and services that are closely related to the development of the national economy and the people's lives. The specific right of judgment is vested in the price department of the State Council and the people's governments of provinces, autonomous regions and municipalities directly under the Central Government.

4、 What kinds of illegal acts are stipulated in the Special Provisions?

The Special Provisions stipulates four types of common illegal acts during the period of abnormal market price fluctuations, and refines the legal elements of each type of illegal act on the basis of the original laws and regulations.

First, fabricating and spreading information about price increases. market The price is determined by the relationship between supply and demand. If some market subjects are allowed to fabricate and disseminate price rise information, it may aggravate the tension of the masses, artificially amplify market demand, lead to imbalance between supply and demand, and push up market prices. Therefore, the Special Provisions prohibit operators, other units and individuals from fabricating and disseminating price rise information to disrupt the market price order.

The second is malicious hoarding. In general, the number of goods to be stored and the time of sale are entirely decided by the operator. However, for commodities with tight market supply and abnormal price fluctuations, if operators buy more than they sell, only buy but not sell, or hoard and refuse to sell, they will further reduce market supply, push up prices, and harm consumers' interests. Therefore, if the operator's behavior constitutes malicious hoarding, it shall be punished according to law.

The third is to bid up prices to make huge profits. During the period of abnormal fluctuation of market price, operators should not only aim at making profits, but also bear certain social responsibilities. Therefore, the Special Provisions require that during the period of abnormal fluctuation of market price, the difference between production and sales or purchase and sales of operators shall not exceed twice the difference in the normal period.

Fourth, collusion in price increases. Only in a fully competitive market environment can operators have the internal motivation to improve production efficiency and reduce costs, and consumers can get high-quality and inexpensive goods. Operators seek to raise prices through collusion, which eliminates and limits normal market competition and damages the rights and interests of consumers, and is clearly prohibited by law. Collusive price hikes during the period of abnormal market price fluctuations are more harmful, so the Special Provisions have special provisions on collusive price hikes.

5、 In what aspects does the Special Provisions increase punishment? {page_break}

First of all, the Special Provisions have increased the amount of fines for various illegal acts. If there are no illegal gains from colluding with price increases, the fine will be increased from 100000 yuan to 1 million yuan to 200000 yuan to 2 million yuan. If there is no illegal income from fabricating and spreading information about price increases and maliciously hoarding, the fine will be increased from 50000 yuan to 500000 yuan to 200000 yuan to 2 million yuan. In addition, the fine for refusing to provide relevant materials or providing false materials was increased from 50000 yuan to 200000 yuan.

Secondly, it reaffirmed the principle of heavier punishment. operator Those who transfer the funds or commodities involved in the case, refuse to cooperate with the investigation and handling, repeatedly investigate and repeatedly commit crimes, seriously violate the law or have a large social impact shall be given heavier punishment within the statutory range. In addition, the Special Provisions further explains the "heavier punishment" and clearly stipulates that the "heavier punishment" refers to the higher application within the statutory fine range; If there are more than two types of administrative penalty, it shall be heavier; If it can be imposed concurrently, it shall also be punished.

Third, the introduction of criminal responsibility. The Special Provisions clearly stipulates that if the price violation seriously disturbs the market order and constitutes a crime, criminal responsibility shall be investigated according to law.

6、 In what aspects does the Special Provisions reflect prompt investigation and punishment?

Summarizing the experience of price supervision in special periods such as the fight against SARS and earthquake relief, the Special Provisions, on the premise of ensuring fair procedures, have made necessary simplification of price supervision, inspection and law enforcement procedures according to law. For example, according to the regulations, if the situation is urgent and it is necessary to immediately stop and investigate illegal pricing acts, the case can be filed on the spot. That is, the law enforcement personnel can directly file and investigate the acts that are found to be seriously suspected of violating the law, and then report to the head of the competent price department afterwards. For another example, for enterprises with incomplete transaction records and accounting books, it is often very difficult to find out the specific amount of illegal income. In order to stop and investigate illegal acts quickly, the Special Provisions stipulates that if the illegal income cannot be calculated or is difficult to calculate, it can be treated as no illegal income and punished according to law.