Provisions for the Administration of the Publications Market

(Promulgated by the General Administration of Press and Publication and the Ministry of Commerce on, and effective as of, March 25 2011.)

Order of the GAPP No.52

Part One: General provisions

Article 1: These Provisions have been formulated pursuant to the Regulations for the Administration of Publishing and relevant laws and administrative regulations in order to regulate publication distribution activities and the oversight thereof, establish a unified, open, competitive and orderly national publications market and develop the socialist publishing industry.

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.