China has introduced new regulations to ensure timely payments to small and medium-sized enterprises (SMEs), a significant move to bolster the private sector and enhance economic vitality.
Chinese Premier Li Qiang signed a decree from the State Council unveiling the revised regulations, which aim to create a fairer and more dynamic business environment for SMEs. The changes coincide with China’s efforts to draft a private economy promotion law, recognizing the private sector as a vital pillar of the country’s socialist market economy.
The updated regulations, set to take effect on June 1, include key revisions to the original 2020 regulations. They outline detailed responsibilities for relevant departments at both central and local levels to ensure SMEs receive payments promptly. One of the standout provisions is the requirement for large enterprises to pay SMEs within 60 days of the delivery of goods, projects, or services.
To strengthen enforcement, the regulations enhance supervision mechanisms and streamline the process for handling complaints related to payment delays. Penalties for illegal acts, such as withholding or delaying payments to SMEs, have been intensified to deter violations.
This initiative underscores China’s commitment to supporting SMEs, which play a crucial role in job creation and economic growth. By ensuring timely payments, the regulations aim to alleviate financial pressures on SMEs, enabling them to operate more smoothly and contribute to the broader economy.
