On August 28, 2026, China’s highest legislative body, the National People’s Congress Standing Committee, released the draft Anti-Cross-Border Corruption Law (the “Draft ACBC”). When enacted, the Draft ACBC would be China’s first standalone statute targeting cross-border corruption.[1] It targets corruption that flows either “outbound” (i.e., bribes flowing out of China to overseas recipients) or “inbound” (i.e., bribes flowing into China to domestic recipients). It covers not only public bribery but also commercial bribery, fraud, embezzlement, and related misconduct in cross-border transactions.
In addition to Chinese individuals and entities, multinational companies (“MNCs”) and their employees would be subject to the Draft ACBC for any corrupt conduct that has (i) a “cross-border” element (e.g., bribes paid by an MNC into or out of China) and (ii) a corrupt “impact” in, or other nexus to, China (e.g., a transaction, person, or entity in China is adversely implicated).
Importantly, the Draft ACBC would require mandatory self-disclosure of suspected violations, mandate corporate compliance programs, and prohibit facilitating foreign governments’ anti-corruption enforcement in China. However, the Draft ACBC’s ban on foreign government enforcement in China is consistent with multiple other existing Chinese laws and does not appear to impose a more restrictive prohibition.
The Draft ACBC does not create new penalties. Companies and individuals that violate the statute would be subject to criminal and civil penalties under existing Chinese laws for corresponding domestic offenses (e.g., the Criminal Law). The only exception is failures in a company’s compliance program, for which the Draft ACBC imposes penalties including suspension of business operations or revocation of licenses.
The Draft ACBC is expected to be enacted into law in the coming months.
The Draft ACBC applies broadly. It covers Chinese nationals, Chinese companies and their overseas entities,[2] and foreign companies operating in China and their China-based entities. Importantly, it also reaches foreign persons and entities whose misconduct has a nexus to China, even if they have no entities or personnel there. In short, any MNC with operations, investments, joint ventures, or business dealings touching China potentially falls within the Draft ACBC’s reach.
In terms of covered misconduct, Article 3 of the Draft ACBC defines “cross-border corruption” to broadly encompass the following five categories:
Article 31 mandates that companies report suspected cross-border corruption to supervisory or public security authorities. Several key questions remain unanswered in the current draft: the monetary or evidentiary threshold that triggers the disclosure obligation,[4] the required timing of report, whether the obligation applies to overseas MNCs that conduct business with but have no presence in China, and whether a self-disclosure compelled by Article 31 qualifies as voluntary cooperation. Article 43 of the Draft ACBC expressly recognizes voluntary surrender, truthful confession, active cooperation, and voluntary return of illicit gains as grounds for reduced penalties, but the interplay between these mitigating factors and the mandatory self-disclosure obligation remains unclear.
Article 26 requires government-to-government channels for cross-border enforcement cooperation to investigate and act upon corruption. However, absent approval from Chinese authorities (including the Ministry of Justice), (1) Foreign Persons may not conduct enforcement activities such as anti-cross-border corruption investigations in China, whether directly or through others; and (2) Chinese Persons may not provide evidence or assistance for such foreign enforcement activities.
Several preexisting statutes similarly require approval from Chinese authorities before foreign enforcement activities may be conducted in China or cross-border evidence may be shared. These statutes include, among others, Article 4 of the International Criminal Judicial Assistance Law (2018); Article 36 of the Data Security Law (2021); and Article 177 of the Securities Law (2019). The Draft ACBC’s Article 26 is consistent with these existing requirements and does not appear to impose a more restrictive prohibition.
A reasonable reading of Article 26—though untested in Chinese courts—is that it is principally aimed at prohibiting unauthorized foreign governments’ anti-corruption enforcement activities in China, not at bona fide corporate internal investigations. Article 26 prohibits MNCs from conducting “enforcement activities” that target foreign government-initiated actions. As discussed below, the Draft ACBC itself requires companies to maintain compliance programs that include internal investigation capabilities for cross-border transactions (Articles 29–34). Read together with Article 26, bona fide corporate internal investigations should remain permissible. In practice, however, an MNC should assess whether an investigation is, in substance, an internal corporate inquiry or a government-directed one.
Articles 29–34 of the Draft ACBC would require companies to maintain anti-corruption compliance programs. Article 45 provides that failure to maintain compliance programs may expose companies to suspension of relevant business operations, mandatory rectification of offending conduct, or revocation of business licenses. The compliance program features mandated by the Draft ACBC—including risk assessments, written policies and procedures, reporting channels, internal investigations, third-party due diligence, books-and-records controls, and employee training—will be familiar to MNCs that have benchmarked their compliance programs against the U.S. Department of Justice’s Evaluation of Corporate Compliance Programs guidance. It remains to be seen whether the compliance requirements under the finalized version of the Draft ACBC, and any corresponding implementing regulations the Chinese government issues in the future, will emulate or exceed those under the U.S. Foreign Corrupt Practices Act (the “FCPA”).
The National Supervisory Commission would lead enforcement under the Draft ACBC, coordinating with a broad array of Chinese agencies. These agencies include those responsible for foreign affairs, public security, justice, finance, commerce, anti-money laundering, audit, financial and securities regulation, and cyberspace administration (Article 8). The breadth of this enforcement architecture suggests that the Draft ACBC will extend well beyond traditional bribery cases into financial flows, asset tracing, data governance, and international cooperation.
Compared to the FCPA, the Draft ACBC is broader in several respects: it covers a wider range of misconduct such as commercial bribery; it mandates self-disclosure of suspected violations; and it bans cooperation with foreign government enforcement activities in China. However, the Draft ACBC’s ban on foreign government enforcement in China is consistent with multiple other existing laws. Moreover, the FCPA’s anti-corruption provisions target bribery of foreign officials, whereas the Draft ACBC targets corrupt conduct that is either “outbound” (i.e., improper benefits flowing out of China to overseas recipients) or “inbound” (i.e., improper benefits flowing into China to domestic recipients or has some other adverse “impact” in China).
From the standpoint of MNC, the Draft ACBC would impose new anti-corruption obligations on their China-related business. MNCs would be required to self-disclose suspected violations to Chinese security authorities, ensure that their compliance programs meet the statute’s requirements, and refrain from facilitating any foreign government enforcement within China (to the same extent already prohibited under other, preexisting Chinese laws). Additionally, the Draft ACBC covers a broad range of corrupt acts, including public and commercial bribery, embezzlement, fraud, and related offenses in connection with transactions with a cross-border nexus to China.
Some key elements in the Draft ACBC remain subject to clarification. Most notably, it remains unclear under what circumstances an incident rises to the level of a suspected violation subject to the statute’s mandatory self-disclosure. MNCs with cross-border business in China are advised to monitor the upcoming developments in the Draft ACBC.
As further explained in the Terms / Notices linked below, the information provided herein is not legal advice. Any information concerning the People’s Republic of China (PRC) is not an opinion on, determination on, or certification of the application of PRC law. We are not licensed to practice PRC law.
[1] For the purpose of this article, “China” refers to mainland China and does not include the Hong Kong Special Administrative Region, the Macao Special Administrative Region, or Taiwan. Here, “Chinese Persons” refers to Chinese nationals and Chinese enterprises; “Foreign Persons” refers to foreign nationals and foreign enterprises.
[2] Article 3 of the Draft ACBC refers to “domestic enterprises and their branches and subsidiaries” (境内企业及其分支机构、子公司) without specifying whether this encompasses overseas-incorporated subsidiaries. While the language is broad enough to bring overseas entities of Chinese companies within the Draft ACBC’s regulated subjects, the statute does not address to what extent such overseas entities would be regulated, particularly given that they are incorporated under foreign law and the legal nexus to China may be limited. This ambiguity may be clarified through future implementing regulations or interpretive guidance.
[3] The Draft ACBC refers to “branches and subsidiaries” (分支机构、子公司) for domestic enterprises and only “branches” (分支机构) for foreign enterprises. The difference appears deliberate: a subsidiary of a foreign enterprise operating in China would typically be treated as a domestic entity in its own right.
[4] China’s Criminal Procedure Law provides generally in Article 110 that any entity or individual that discovers facts of a crime or a criminal suspect has a duty to report to the public security organs, procuratorates, or courts; Article 110 itself does not specify a separate penalty for non-reporting.