Provisions for the Administration of the Publications Market

Article 2: These Provisions shall govern publication distribution activities and the oversight thereof.

For the purposes of these Provisions, the term “publications” means books, newspapers, periodicals, audio and video products, electronic publications, etc.

For the purposes of these Provisions, the term “distribution” or “distribute” includes activities such as general distribution, wholesaling, retailing, leasing and exhibition.

The term “general distribution” means the sale of publications by the sole supplier thereof to other publication business operators.

The term “wholesaling” means the sale of publications by a supplier to other publication business operators.

The term “retailing” means the direct sale of publications to consumers by a business operator.

The term “leasing” means the provision of publications to readers by a business operator for a rental charge.

The term “exhibition” means the organisation by a host in a fixed place for a fixed period of time of a gathering of publication business operators for the purpose of exhibiting, selling and subscribing for publications.

Article 3: The state implements, in accordance with the law, a system of permits in respect of the distribution of publications. No entity or individual may engage in publication distribution activities without a permit, unless otherwise provided herein.

Article 4: The General Administration of Press and Publication is responsible for the oversight of publication distribution activities nationwide and formulation of plans for the development of the publication distribution industry nationwide.

The press and publication administrative departments of the provinces, autonomous regions and municipalities directly under the central government are responsible for the oversight of publication distribution activities within their administrative areas and formulation of plans for the development of the publication distribution industry within their provinces, autonomous regions and municipalities directly under the central government. The press and publication administrative departments of people's governments at every level below the provincial level are responsible for the oversight of publication distribution activities within their administrative areas.

The formulation of plans for the development of the publication distribution industry must undergo objective discussion, and shall be done in keeping with the principles of lawfulness, impartiality, adherence to reality and promotion of development.

Article 5: Associations in the distribution industry shall effect self-regulation in accordance with their charters and under the guidance of the press and publication administrative department.

Part Two: Establishment of publication distribution entities

Article 6: To establish a publication general distribution enterprise or for another entity to engage in the publication general distribution business, the following conditions shall be satisfied:

(1) having a specific enterprise name and scope of business;

(2) having the distribution of publications as its primary business;

(3) having the entity and distribution personnel suitable for the publication general distribution business, with at least one person in charge with senior-level or higher professional qualifications of a publication distributor or mid-level or higher professional technical qualifications relating to the publication distribution profession recognised by the General Administration of Press and Publication;

(4) having the equipment and a fixed place of business (with an operating area of not less than 1,000 square metres) suitable for the publication general distribution business;

(5) having registered capital of not less than Rmb20 million;

(6) having a sound management system, and an information management system that meets industry standards; and

(7) not having had administrative penalties imposed by the press and publication administrative department, and not having a record of serious violations of the law during the most recent three years.

With the exception of branches engaging in the general distribution business lawfully established by publication general distribution enterprises, general distributors shall be legal persons established in the form of companies.

Article 7: To apply to establish a publication distribution enterprise or for another entity to apply to engage in the publication general distribution business, application materials must be submitted to the press and publication administrative department of the province, autonomous region or municipality directly under the central government where the applicant is located. After review thereby, the application will be forwarded to the General Administration of Press and Publication for examination and approval.

The General Administration of Press and Publication shall render its decision on whether or not to grant approval and inform the applicant in writing thereof within 60 working days from the date of acceptance of the application. If it grants approval, the General Administration of Press and Publication will issue a Permit for Dealing in Publications. The applicant shall then carry out relevant procedures in accordance with the law with the administration for industry and commerce on the strength of the Permit for Dealing in Publications. If the General Administration of Press and Publication withholds approval, it shall give the reason therefor in writing.

The application materials include the following written materials:

(1) a written application providing the basic particulars of the entity and the application matters;

(2) the name of the entity and articles of association;

(3) proof of the registered capital;

(4) details of the place of business and proof of the use rights thereto;

(5) the proofs of identity of the legal representative and the main persons in charge;

(6) the professional qualification certificate of a distributor or proof of other professional technical qualifications of a person in charge;

(7) documentation evidencing the status of the enterprise's information management system; and

(8) other required supporting documentation.

Article 8: To establish a publication wholesaler or for another entity to engage in the publication wholesale business, the following conditions shall be satisfied:

(1) having a specific enterprise name and scope of business;

(2) having the entity and distribution personnel suitable for the publication wholesale business, with at least one person in charge with mid-level or higher professional qualifications of a publication distributor or mid-level or higher professional technical qualifications relating to the publication distribution profession recognised by the General Administration of Press and Publication;

(3) having the equipment and a fixed place of business (with the operating area of a single store in a publication wholesale market of not less than 50 square metres, or an operating area of not less than 200 square metres for a standalone place of business) suitable for the publication wholesale business;

(4) having registered capital of not less than Rmb5 million;

(5) having a sound management system, and an information management system that meets industry standards; and

(6) not having had administrative penalties imposed by the press and publication administrative department and not having a record of serious violations of the law during the most recent three years.

With the exception of branches engaging in the wholesale business lawfully established by publication distribution enterprises, wholesalers shall be legal persons established in the form of companies.

Article 9: To apply to establish a publication wholesaler or for another entity to apply to engage in the publication wholesale business, application materials must be submitted to the local prefecture-level city press and publication administrative department of the place where the applicant is located. After review thereby, the application will be forwarded to the press and publication administrative department of the province, autonomous region or municipality directly under the central government for examination and approval.

The press and publication administrative department of the province, autonomous region or municipality directly under the central government shall render its decision on whether or not to grant approval and inform the applicant in writing thereof within 20 working days from the date of acceptance of the application. If it grants approval, the press and publication administrative department of the province, autonomous region or municipality directly under the central government will issue a Permit for Dealing in Publications and report the same to the General Administration of Press and Publication for the record. The applicant shall then carry out relevant procedures in accordance with the law with the administration for industry and commerce on the strength of the Permit for Dealing in Publications. If the press and publication administrative department of the province, autonomous region or municipality directly under the central government withholds approval, it shall give the reason therefor in writing.

The application materials include the following written materials:

(1) a written application providing the basic particulars of the entity and the application matters;

(2) the articles of association of the enterprise;

(3) proof of the registered capital;

(4) details of the place of business and proof of the use rights thereto;

(5) the proofs of identity of the legal representative and the main persons in charge;

(6) the professional qualification certificate of a distributor or proof of other professional technical qualifications of a person in charge;

(7) documentation evidencing the status of the enterprise's information management system; and

(8) other required supporting documentation.

Article 10: To establish a publication retailer or for another entity or an individual to engage in the publication retail business, the following conditions shall be satisfied:

(1) having a specific name and scope of business;

(2) having at least one person in charge with junior level or higher professional qualifications of a publication distributor or junior level or higher professional technical qualifications relating to the publication distribution profession recognised by the General Administration of Press and Publication; and

(3) having a fixed place of business.

Article 11: To apply to establish a publication retailer or for another entity or an individual to apply to engage in the publication retail business, application materials must be submitted to the press and publication administrative department of the county-level people's government of the place where the applicant is located.

The county-level press and publication administrative department shall render its decision on whether or not to grant approval and inform the applicant in writing thereof within 20 working days from the date of acceptance of the application. If it grants approval, the press and publication administrative department of the county-level people's government will issue a Permit for Dealing in Publications and report the same to the press and publication administrative department at the next higher level for the record. Additionally, if the operating area of the applicant is at least 5,000 square metres, the press and publication administrative department of the county-level people's government will report the approval to the press and publication administrative department of the province, autonomous region or municipality directly under the central government for the record. The applicant shall then carry out relevant procedures in accordance with the law with the administration for industry and commerce on the strength of the Permit for Dealing in Publications. If the county-level press and publication administrative department withholds approval, it shall give the reason therefor in writing.

The application materials include the following written materials:

(1) a written application providing the basic particulars of the entity and the application matters;

(2) proof of the use rights to the place of business; and

(3) the proof of identity and the professional qualification certificate of a distributor or proof of other professional technical qualifications of the business operator.

Article 12: To establish a publication leasing enterprise or for another entity or an individual to engage in the publication leasing business, record-filing procedures shall be carried out with the local press and publication administrative department of the people's government at the county level on the strength of a photocopy of the business licence and documentation on matters such as the business address, legal representative or main persons in charge within 15 days after the business licence is received.

Article 13: To establish a publication chain enterprise or for another chain enterprise to engage in publication chain operations, the following conditions shall be satisfied:

(1) having a specific enterprise name and scope of business;

(2) having the entity and mode of operation suitable for chain operations;

(3) having registered capital of not less than Rmb3 million, and if nationwide chain operations are to be engaged in, registered capital of not less than Rmb10 million;

(4) having at least 10 directly operated chain stores;

(5) having the entity and distribution personnel suitable for publication chain operations, with at least one person in charge with mid-level or higher professional qualifications of a publication distributor or mid-level or higher professional technical qualifications relating to the publication distribution profession recognised by the General Administration of Press and Publication;

(6) having the equipment and a fixed place of business (with the model store having an operating area of not less than 500 square metres) suitable for publication chain operations;

(7) having a sound management system, and an information management system that meets industry standards; and

(8) not having had administrative penalties imposed by the press and publication administrative department, and not having a record of serious violations of the law during the most recent three years.

Article 14: To apply to establish a publication chain enterprise or for another chain enterprise to apply to engage in publication chain operations, application materials must be submitted to the local prefecture-level city press and publication administrative department of the place where the head office is located. After review thereby, the application will be forwarded to the press and publication administrative department of the province, autonomous region or municipality directly under the central government for examination and approval. The press and publication administrative department of the province, autonomous region or municipality directly under the central government shall render its decision on whether or not to grant approval and inform the applicant in writing thereof within 20 working days from the date of acceptance of the application. If it grants approval, the press and publication administrative department of the province, autonomous region or municipality directly under the central government will issue a Permit for Dealing in Publications and report the same to the General Administration of Press and Publication for the record. If the press and publication administrative department of the province, autonomous region or municipality directly under the central government withholds approval, it shall give the reason therefor in writing.

To apply to establish a publication chain enterprise that is to operate nationwide or for another chain enterprise to apply to engage in nationwide publication chain operations, application materials must be submitted to the press and publication administrative department of the province, autonomous region or municipality directly under the central government where the head office is located. After review thereby, the application will be forwarded to the General Administration of Press and Publication for examination and approval. The General Administration of Press and Publication shall render its decision on whether or not to grant approval and inform the applicant in writing thereof within 60 working days from the date of acceptance of the application. If it grants approval, the General Administration of Press and Publication will issue a Permit for Dealing in Publications. The applicant shall then carry out relevant procedures in accordance with the law with the administration for industry and commerce on the strength of the Permit for Dealing in Publications. If the General Administration of Press and Publication withholds approval, it shall give the reason therefor in writing.

The application materials include the following written materials:

(1) a written application providing the basic particulars of the enterprise, the application matters, etc.;

(2) the name of the entity and articles of association;

(3) proof of the registered capital;

(4) a list of the places of business of the head office and the chain stores, and proof of the use rights thereto;

(5) the proofs of identity of the legal representative and the main persons in charge;

(6) the professional qualification certificate of a distributor or proof of other professional technical qualifications of a person in charge;

(7) documentation evidencing the status of the enterprise's information management system; and

(8) other required supporting documentation.

Article 15: When a publication chain enterprise establishes a directly-operated chain store, it need not separately carry out procedures for a Permit for Dealing in Publications therefor, and may, after carrying out record filing with the press and publication administrative department of the county-level people's government of the place where the store is located on the strength of a photocopy of the Permit for Dealing in Publications of the head office of the publication chain enterprise, collect the business licence of an entity without legal personality from the administration for industry and commerce in accordance with the law.

If a publication chain enterprise is to open a chain store that it does not directly operate, the chain store must carry out examination and approval procedures in accordance with relevant provisions of Articles 10 and 11 hereof, unless it already has a Permit for Dealing in Publications.

Article 16: The state permits the establishment of Sino-foreign equity joint ventures, Sino-foreign cooperative joint ventures and wholly foreign-owned enterprises that engage in book, newspaper, periodical and electronic publication distribution activities, and the establishment of Sino-foreign cooperative joint ventures that engage in audio and video product distribution activities. If book, newspaper and/or periodical chain operations are engaged in and the operator has more than 30 chain stores, the foreign party may not have a controlling interest; and a foreign investor may not, through a disguised equity interest, violate the foregoing restriction on 30 chain stores.

The conditions to be satisfied for the establishment of a foreign-invested publication general distributor, wholesaler, retailer or chain enterprise and the procedures for examination and approval by the press and publication administrative department shall be handled in accordance with relevant provisions of Articles 6 to 15 hereof. Once an applicant has secured an approval document from the press and publication administrative department, it must submit an application to and carry out the examination and approval procedures for foreign investment with the competent commerce department in accordance with relevant laws and regulations and, within 90 days after securing approval, it must collect a Permit for Dealing in Publications from the original approving press and publication administrative department on the strength of the approval document and the Approval Certificate of a Foreign-invested Enterprise. The applicant shall then collect its business licence from the local administration for industry and commerce on the strength of the Permit for Dealing in Publications and the Approval Certificate of a Foreign-invested Enterprise in accordance with the law.

Article 17: An entity or individual that wishes to engage in the publication distribution business through an information network, such as the internet, shall obtain a Permit for Dealing in Publications in accordance herewith. A foreign-invested enterprise shall additionally carry out the examination and approval procedures for foreign investment in accordance with relevant provisions.

A publication distribution entity with a Permit for Dealing in Publications that engages in the publication distribution business through an information network, such as the internet, within its approved scope of business shall, within 15 days of launching its online publication distribution business, carry out record-filing procedures with the original approving press and publication administrative department.

Article 18: Applications for the establishment of book clubs, readers' clubs or other similar organisations that engage in the distribution of publications shall be handled in accordance with Articles 10 and 11 hereof.

A publication distribution enterprise may establish a book club, readers' club or other similar organisation without legal personality without requiring examination and approval, however, it shall, within 15 days after establishment, carry out record-filing procedures with its original approving press and publication administrative department on the strength of the relevant materials.

Article 19: A publication distribution entity may at a certain place and for a certain period of time establish a temporary retail point within the administrative area of its original approving press and publication administrative department to carry on publication sales activities within its scope of business, but must carry out record-filing procedures in advance with the county level press and publication administrative department of the place where the sales point is established and must comply with other relevant administrative provisions of such place.

Article 20: A publication general distributor may engage in the publication wholesale and retail businesses; and a publication wholesaler may engage in the publication retailing business.

When a publication distribution entity wishes to set up a distribution establishment without legal personality, it shall carry out examination and approval procedures in accordance with the relevant provisions for the establishment of a publication general distribution, wholesale or retailing entity depending on the scope of business of the proposed establishment.

When a publication distribution entity wishes to set up a distribution establishment without legal personality to distribute publications published by it, it must carry out record-filing procedures with the press and publication administrative department of the province, autonomous region or municipality directly under the central government where the establishment is located on the strength of a photocopy of its Permit for Dealing in Publications and relevant materials on the establishment, such as those on the address where it is established and its personnel within 15 days after the establishment is established.

Article 21: If the particulars recorded on the Permit for Dealing in Publications of an entity or individual engaging in the publication distribution business changes, or if such entity is absorbed, merged or divided, examination and approval procedures shall be carried out with the original approving press and publication administrative department in accordance herewith, and relevant registration procedures shall be carried out with the administration for industry and commerce on the strength of the approval document. A foreign-invested enterprise shall additionally carry out the examination and approval procedures for foreign investment in accordance with relevant provisions.

If an entity or individual engaging in the publication distribution business terminates its/his/her business activities, it/he/she shall carry out de-registration procedures with the administration for industry and commerce and record-filing procedures with the original approving press and publication administrative department.

Part Three: Administration of publication distribution activities

Article 22: No organisation or individual may distribute the following publications:

(1) illicit publications with content prohibited by the Regulations for the Administration of Publishing;

(2) illegal publications, including publications published, printed or reproduced without approval, publications published by forging or illegally using the name of a publisher, newspaper or periodical, and illegally imported publications;

(3) publications that infringe upon the copyright or exclusive right to publish of a third party; and

(4) publications that the press and publication administrative department has expressly prohibited from being published, printed or reproduced, or distributed.

Article 23: Internally distributed publications may not be publicly publicised, displayed, exhibited or sold.

Internal information-type publications may only be circulated free of charge within the system in question, the industry in question or the entity in question, and may not be distributed by any organisation or individual.

Article 24: An entity or individual engaging in the publication distribution business shall, in its distribution activities, comply with the principles of fairness, lawfulness and good faith, enter into supply and sales contracts in accordance with the law and may not harm the lawful rights and interests of consumers.

An entity or individual engaging in the publication distribution business must comply with the following provisions:

(1) it/he/she shall order from a legally-established publication distribution entity; if it/he/she distributes imported publications, it/he/she must order from a legally-established publication importer;

(2) it/he/she shall keep relevant non-finance documents relating to publication distribution, such as order and sales lists, for at least two years, for future verification purposes;

(3) it/he/she may not exceed the scope of business approved by the press and publication administrative department in its/his/her operations;

(4) it/he/she may not post or distribute subscription orders, advertisements or publicity posters with content prohibited by laws or regulations or with fraudulent language;

(5) it/he/she may not modify the copyright page of publications without authorisation;

(6) it/he/she shall post the Permit for Dealing in Publications in a conspicuous location in its/his/her place of business; if it/he/she uses an information network to engage in the publication distribution business, it/he/she shall post relevant information recorded on its/his/her Permit for Dealing in Publications and business licence or a link thereto in a prominent location on the home page of its/his/her website or on the page used to engage in business activities; and

(7) it/he/she may not alter, modify, lease out, lend, sell or otherwise transfer in any manner its/his/her Permit for Dealing in Publications or approval document.

Article 25: A publication distribution entity shall establish a vocational training system and, in accordance with the PRC Labour Law and the classification of professions and vocational skill standards for publication distributors determined by the state, arrange for its working personnel to undergo vocational skill assessments by an assessment organisation approved by the state labour administrative department.

Article 26: A publisher has general distribution rights to publications it itself publishes.

A publisher may not transfer or transfer in a disguised manner its publication general distribution rights to an entity that does not have publication general distribution rights, may not appoint an entity without publication wholesale rights to wholesale publications or act as its agent in the wholesaling of publications, and may not appoint an entity that is not a publication distribution entity to distribute publications.

Article 27: To establish an online trading platform that distributes publications, record-filing procedures shall be carried out with the local press and publication administrative department of the province, autonomous region or municipality directly under the central government, and the entity establishing the same shall subject itself to the guidance and oversight of the press and publication administrative department.

A business operator that provides online trading platform services for the distribution of publications shall examine the status of a business entity applying to engage in the distribution of publications through the online trading platform, verify the business entity's business licence and Permit for Dealing in Publications and retain photocopies of such documents for future reference. It may not provide online trading platform services to a business operator without a permit and licence or one lacking a permit or licence.

If a business operator that provides online trading platform services discovers that illegal activities are being carried out on the online trading platform, it shall take effective measures to put a stop thereto and report the same to the local press and publication administrative department in a timely manner.

Article 28: A press and publication administrative department of a province, autonomous region or municipality directly under the central government or a national publishing or distribution industry association may apply to host a national publication exhibition activity and must apply to the General Administration of Press and Publication for examination and approval six months in advance.

A national publishing or distribution industry association may host a professional publication exhibition activity that takes place in more than one province; a city or county-level press and publication administrative department or provincial-level publishing or distribution industry association may host a local publication exhibition activity; the hosting entity must carry out record-filing procedures with the press and publication administrative department of the province, autonomous region or municipality directly under the central government where it is located two months in advance.

Article 29: A distribution entity of primary school and secondary school textbooks shall satisfy the capital, entity, personnel and other conditions required for the textbook distribution business and have secured the textbook distribution qualifications approved by the General Administration of Press and Publication. The distribution entities for primary school and secondary school textbooks falling within the scope of government procurement shall be determined in accordance with relevant provisions of the PRC Government Procurement Law (Revised in 2014) . No other entity or individual may engage in the business of distribution of primary school and secondary school textbooks.

The measures for the administration of the distribution of primary school and secondary school textbooks will be formulated separately by the General Administration of Press and Publication.

Article 30: No entity or individual may engage in the solicitation of subscriptions for, storage, transport, mailing, delivery, hand distribution, offering with other items sold or other such activities relating to the publications set forth in Article 22 hereof.

The engagement in the storage, transport and delivery of publications shall be subject to monitoring inspections by the press and publication administrative department.

Article 31: Entities and individuals engaging in the publication distribution business shall be subject to annual inspections in accordance with the provisions of the press and publication administrative department, shall submit truthful statistical data in accordance with the PRC Statistics Law, the Measures for the Administration of Press and Publishing Statistics and relevant regulations, and may not refuse to submit statistical data for any reason, delay the submission thereof, submit fraudulent data, omit the submission of such data or forge or alter such data.

If a publication distribution entity ceases to satisfy the statutory administrative permission conditions, the press and publication administrative department shall order it to rectify the matter within a specified period of time; if it fails to do so, the original permit issuing authority shall revoke its Permit for Dealing in Publications.

Part Four: Penal provisions

Article 32: If a publication distribution entity is established or the publication distribution business is engaged in without approval, penalties shall be imposed in accordance with Article 61 of the Regulations for the Administration of Publishing.

If a distribution establishment or a publication wholesale market is established without approval, or a national publication exhibition activity is hosted without authorisation or if a hosting entity not satisfying the provisions hereof hosts a local professional publication exhibition activity or a professional publication exhibition activity taking place in more than one province without authorisation, penalties shall be imposed in accordance with the preceding paragraph.

Article 33: If illicit publications are distributed, penalties shall be imposed in accordance with Article 62 of the Regulations for the Administration of Publishing.

If publications the import of which is prohibited by the General Administration of Press and Publication are distributed or if distributed imported publications were not ordered from a lawfully approved publication importer, penalties shall be imposed in accordance with Article 63 of the Regulations for the Administration of Publishing.

If other illegal publications or publications of which the publishing, printing, reproduction or distribution is expressly prohibited by the press and publication administrative department are distributed, penalties shall be imposed in accordance with Article 65 of the Regulations for the Administration of Publishing.

If illicit publications or illegal publications are distributed and the concerned party gives an account of or identifies the source thereof, and after verification the same is found to be true, the publications and illegal income shall be confiscated and other administrative penalties may be foregone or mitigated.

Article 34: If these Provisions are violated by distributing publications that infringe upon the copyright or the exclusive right to publish of a third party, penalties shall be imposed in accordance with the PRC Copyright Law and the Implementing Regulations for the PRC Copyright Law.

Article 35: If primary school or secondary school textbooks that have not been lawfully approved are distributed or if an entity that has not been determined by the statutory method engages in the business of distribution of primary school and secondary school textbooks, penalties shall be imposed in accordance with Article 65 of the Regulations for the Administration of Publishing.

Article 36: If a publication distribution entity fails to carry out the procedures for the examination and approval of a change in accordance with provisions, penalties shall be imposed in accordance with Article 67 of the Regulations for the Administration of Publishing.

Article 37: If an entity, in violating these Provisions, has its Permit for Dealing in Publications revoked, the original permit-issuing authority shall revoke the professional qualification certificate of publication distributors of its legal representative or main persons in charge and the persons directly responsible; its legal representative or main persons in charge may not serve as the legal representative or main person in charge of a distribution entity for 10 years from the date he or she has his or her permit revoked.

Article 38: If these Provisions are violated by the commission of any of the acts set forth below, the press and publication administrative department shall order a halt to the violation, give a warning and impose a fine of up to Rmb30,000:

(1) failure to provide relevant non-financial documents, such as publication order and sales lists, for the last two years;

(2) operating beyond the scope of business approved by the press and publication administrative department;

(3) posting or hand distributing subscription orders, advertisements or publicity posters with content prohibited by laws or regulations or with fraudulent language;

(4) modifying the copyright page of a publication without authorisation;

(5) failure to post the Permit for Dealing in Publications in a conspicuous location in the place of business or post relevant information recorded on the Permit for Dealing in Publications and business licence or a link thereto in a prominent location on the webpage;

(6) selling, lending, leasing out, transferring or, without authorisation, altering or modifying the Permit for Dealing in Publications;

(7) distributing internal information-type publications, or publicly publicising, displaying or selling publications that are meant for internal distribution only;

(8) transferring or transferring in a disguised manner publication general distribution rights to an entity that does not have general distribution rights, appointing an entity without publication wholesale rights to wholesale publications or act as an agent in the wholesaling of publications, or appointing an entity that is not a publication distribution entity to distribute publications;

(9) failure by a business operator that provides publication online trading platform services to perform its obligations of examination and administration in accordance herewith;

(10) failure to carry out record-filing procedures where such are required hereby; or

(11) failure to undergo an annual inspection in accordance with provisions.

Article 39: If solicitation for subscription for, storage, transport, mailing, delivery or hand distribution of the publications set forth in Article 22 hereof is carried out or the same are given away with other items sold, penalties shall be imposed in accordance with Article 33 hereof.

Article 40: If Article 31 hereof is violated by failing to submit statistical data, the matter shall be handled in accordance with the Measures for the Administration of Press and Publishing Statistics.

Part Five: Supplementary provisions

Article 41: When an investor from the Hong Kong Special Administrative Region, Macao Special Administrative Region or Taiwan wishes to establish a publication distribution enterprise in another province, autonomous region or municipality directly under the central government, matters shall be handled in accordance with Article 16 hereof and the following supplementary provisions:

(1) Hong Kong and Macao service providers are permitted to provide audio and video product (including post-film product) distribution services in mainland China in the form of a wholly-owned enterprise or equity joint venture;

(2) a Hong Kong or Macao service provider is permitted to have a controlling interest in a book, newspaper and/or periodical chain operation in mainland China, but its capital contribution percentage may not exceed 65%; and

(3) a Hong Kong or Macao service provider shall satisfy the definition of “service provider” in the Mainland and Hong Kong Closer Economic Partnership Arrangement or Mainland and Macao Closer Economic Partnership Arrangement, as the case may be, and the requirements of the relevant provisions thereof and secure a Hong Kong or Macao service provider certificate.

Article 42: Except for existing lawfully-established publication wholesale markets, the provinces, autonomous regions and municipalities directly under the central government may not establish or establish in a disguised manner further publication wholesale markets. A business entity that enters a publication wholesale market must, before selling publications, submit samples of the publications to the management organisation of the wholesale market for examination, and the samples submitted for examination must be identical to the publications that are to be sold.

Article 43: For the purposes of these Provisions, the term “nationwide chain operations” means chain operations in more than one province, autonomous region and/or municipality directly under the central government.

Article 44: The formats of the original and duplicate of the Permit for Dealing in Publications shall be specified by the General Administration of Press and Publication and such permits shall be centrally printed by the General Administration of Press and Publication or the press and publication administrative department of the province, autonomous region or municipality directly under the central government.

Article 45: These Provisions shall be effective as of the date of promulgation. The Provisions for the Administration of the Publications Market, the Measures for the Administration of the Wholesale, Retail and Leasing of Audio and Video Products, the Measures for the Administration of Foreign-invested Book, Newspaper and Periodical Distribution Enterprises, the Measures for the Administration of Sino-foreign Cooperative Joint Venture Audio and Video Product Distribution Enterprises and relevant supplementary provisions previously issued by the General Administration of Press and Publication and relevant departments shall be repealed simultaneously, and other provisions issued prior to the implementation hereof that are inconsistent herewith shall cease to be implemented.