Recently, seven departments, including the Ministry of Civil Affairs, the National Development and Reform Commission, the Ministry of Public Security, the Ministry of Finance, the People's Bank of China, the State Administration for Market Regulation, and the State Administration of Financial Regulation, jointly issued the "Guiding Opinions on Strengthening the Supervision of Advance Fees for Elderly Care Institutions" to regulate the advance fees of elderly care institutions and protect the legitimate rights and interests of the elderly. The Opinions will come into force on October 1, 2024 and will be valid for 5 years. What are the specifics? Let's take a look↓↓
Ministry of Civil Affairs, National Development and Reform Commission, Ministry of Public Security, Ministry of Finance
People's Bank of China State Administration for Market Regulation State Administration of Financial Regulation
Guiding Opinions on Strengthening the Supervision of Advance Fees for Elderly Care Institutions
Civil Affairs Departments (Bureaus), Development and Reform Commissions, Public Security Departments (Bureaus), Finance Departments (Bureaus), Market Supervision Bureaus, Financial Supervision Bureaus of all provinces, autonomous regions and directly under the Central Government, civil affairs bureaus, development and Reform Commissions, public security bureaus, finance bureaus, market supervision bureaus, financial supervision bureaus of all provinces, autonomous regions and municipalities directly under the Central Government, civil affairs bureaus, development and Reform Commissions, public security bureaus, finance bureaus, market supervision bureaus, and financial supervision bureaus of the Xinjiang Production and Construction Corps; People's Bank of China Shanghai Headquarters, provincial branches, branches of cities with separate planning:
In recent years, some pension institutions have adopted the method of pre-charging operation, which has alleviated the problems of insufficient funds for facility construction to a certain extent and relieved the operating pressure. However, there are also a small number of pension institutions have non-standard management and use of funds, after the capital chain is broken, "difficult to refund", "thunder", "run away" and other problems, and even some criminals carry out illegal fund-raising, fraud and other criminal acts, seriously damaging the legitimate rights and interests of the elderly, disrupting the order of the pension service market. In order to implement the spirit of General Secretary Xi Jinping's important instructions on better coordinating development and security and safeguarding the legitimate rights and interests of the elderly, in accordance with the Law of the People's Republic of China on the Protection of the Rights and Interests of the Elderly, the Law of the People's Republic of China on the Protection of Consumer Rights and Interests, the Regulations on the Prevention and Disposal of Illegal Fundraising, the Measures for the Administration of Elderly Care Institutions, and the Opinions of the General Office of the State Council on Promoting the Development of Elderly Care Services (Guo Ban Fa [2019] No. 5), and the General Office of the State Council on Establishing and Improving the Comprehensive Supervision System for Elderly Care Services Opinions on Promoting the High-quality Development of Pension Services" (Guo Ban Fa [2020] No. 48) and other laws and regulations and relevant national regulations, the following opinions are hereby put forward on strengthening the supervision of advance fees for pension institutions.
1. General requirements
(1) Guiding ideology.
Guided by Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era, fully implement the spirit of the 20th National Congress of the Communist Party of China, thoroughly implement the deployment of the Central Financial Work Conference, completely, accurately and comprehensively implement the new development concept, serve to accelerate the construction of a new development pattern, adhere to the people-centered, better coordinate development and security, strengthen the supervision of the collection, management, use and refund of advance fees for pension institutions, standardize and guide the healthy development of pension institutions, prevent and resolve the risks of illegal financial activities such as illegal fundraising, and protect the legitimate rights and interests of the elderly. Maintain the order of fair competition in the pension service market and promote the high-quality development of pension services in the new era.
(2) Basic principles.
-- Persist in seeking truth from facts and adapting measures to local conditions. According to the actual development of pension institutions, learn from useful experience and clarify management requirements. Encourage the use of the Internet, blockchain and other information technology means, through bank depository, insurance and other means, to improve the level of capital security.
-- Adhere to safe development and guard the bottom line. Comprehensively coordinate development and security, not only tolerate and prudently supervise emerging business formats, but also guide elderly care institutions to standardize their operations, crack down on illegal and criminal acts in accordance with the law, and resolutely safeguard the legitimate rights and interests of the elderly.
——Adhere to pragmatism, efficiency, and synergy. Sort out and analyze the risk points in the collection, management, use, refund and other links of advance fees, take pragmatic and effective preventive measures, and effectively manage the management and manage it in place. Strengthen cross-departmental business coordination, strengthen the overall planning and coordination of pre-charge supervision, enhance the joint force of supervision, and improve the efficiency of comprehensive supervision.
(3) Main objectives.
Before 2025, establish and improve the cross-departmental pension institution pre-charge supervision mechanism, further optimize the coordinated supervision, effectively improve the ability of pre-charge fund monitoring and early warning, risk and hidden danger investigation and disposal of violations of laws and regulations, make the pension service market more fair and orderly, effectively reduce the risk of illegal fundraising, and steadily improve the satisfaction of the elderly with pension service consumption.
2. Standardize the prepayment behavior of pension institutions
(4) Definition of advance fees. Advance fees for pension institutions refer to the behavior of pension institutions to charge a certain amount of fees to the elderly or their agents in advance, and promise to provide corresponding pension services in accordance with the service agreement within a certain period of time. The fees collected in advance by pension institutions mainly include pension service fees, deposits and membership fees. Pension service fees refer to bed fees, nursing fees, meals and other expenses; The deposit refers to the cost of guaranteeing the emergency needs of the elderly such as medical treatment, repayment of arrears, compensation for property losses, etc.; Membership fee refers to the fee charged by pension institutions in the form of "membership card" and "VIP card" for the elderly to obtain service qualifications, use facilities and equipment, and enjoy service discounts.
(5) Collect requirements. If the fees charged by pension institutions belong to the government's non-tax revenue, the relevant provisions of the government's non-tax revenue shall be implemented. Encourage elderly care institutions to provide services to the elderly by charging fees in the current month. If the method of pre-charging is adopted, the pension institution shall publicize the pre-charged items, standards and other information in a conspicuous position such as the service venue and the web portal, and report it to the civil affairs department responsible for supervision. For-profit pension establishments shall report to the civil affairs department at the county level where the service site is located, and non-profit pension establishments shall report to the civil affairs department at the same level as the registration management organ. Provincial-level civil affairs departments may, in conjunction with relevant departments, determine the maximum period of advance collection of local pension service fees and the maximum amount of deposit according to local conditions, but the period of advance collection of pension service fees shall not exceed 12 months, and the deposit collected for a single elderly person shall not exceed 12 times the monthly bed fee of the elderly. For pension institutions that collect membership fees in order to make up for the lack of funds for facility construction, the provincial-level civil affairs department may, in accordance with the principle of inclusive and prudential supervision, clarify restrictive requirements such as the maximum amount of membership fees. Pension institutions that have not yet been built or have been built but do not yet have the conditions to accommodate the elderly shall not collect membership fees. Public pension institutions, public and private pension institutions, and pension institutions built in cooperation with the government and social forces shall not charge membership fees. Where pension establishments or their legally-designated representatives (principle responsible persons) or actual controllers are judgment defaulters, or have received administrative or criminal punishments for illegal fundraising or fraud, and are included in the list of seriously untrustworthy entities for pension services, enterprises, or social organizations, and have not yet been removed, membership fees must not be collected. Elderly care institutions shall not exceed the bed supply capacity to commit services, ensure that the total number of elderly people who pay fees shall not exceed the total number of beds on their record, and the total amount of advance fees shall not exceed their net fixed assets (the value of assets that have created security interests shall not be included in the net fixed assets).
(6) Agreement management. Pension institutions shall fully protect the right to know of the elderly and their agents, truthfully and accurately explain the collection and use of advance fees and other relevant information, inform of possible risks, and clarify the items, standards, management methods, refund conditions and methods, and liability for breach of contract in the service agreement. Pension institutions shall not use standard clauses to set unreasonable refund restrictions, exclude or restrict the rights of the elderly, increase the responsibilities of the elderly, or reduce or exempt the responsibilities of the pension institutions. False or misleading publicity must not be made, and the elderly or their agents must not be induced to pay advance fees by promising to repay principal and interest, or giving other investment returns. The elderly and their agents should raise their awareness of risk prevention, consume rationally, pay advance fees prudently, not be tempted by high returns, do not participate in illegal fundraising, and beware of property losses. Pension institutions shall issue invoices in accordance with national regulations, and shall not fill in the content that is inconsistent with the actual transaction, and shall not replace the receipt voucher with a "white slip" such as a receipt for payment. After paying the fee, the elderly or their agents should ask for and properly keep the invoices or other consumption vouchers, and may claim their rights in accordance with laws and regulations in the event of a consumer dispute.
(7) Purpose of use. The advance fee of the pension institution is mainly used to offset the expenses that the elderly need to pay during their stay in the institution, make up for the lack of funds for the construction of the institution's facilities, or develop the institution's pension service business. The deposit shall not be spent except for the refund of fees, the payment of medical expenses for the elderly in emergencies, the deduction of the arrears of pension service fees for the elderly, or the liquidated damages and compensation that should be paid to the pension institutions. The membership fee shall not be used for high-risk investments such as non-self-use real estate, securities, financial derivatives, etc., and shall not be directly or indirectly invested in companies whose main business is to buy and sell securities, as well as for other lending purposes; shall not invest in or donate to other enterprises under the name of its legal representative (main responsible person) or actual controller; Pension institutions that implement chain and group operation shall not invest in or donate to affiliated enterprises.
(8) Refund requirements. For the advance fees that meet the refund conditions agreed in the service agreement, the pension institution shall refund the fee in a timely manner in accordance with the agreement, and shall not refuse or delay. Where the elderly have not yet been admitted to the institution to receive services and propose to terminate the service agreement, the pension institution shall promptly refund the advance fee. If the elderly person has already been admitted to the institution to receive services and proposes to terminate the agreement, the amount that has been consumed shall be deducted, and the pension institution shall in principle refund the remaining fees in a lump sum according to the original channel, unless otherwise agreed in the terms of the agreement. Where pension establishments suspend or terminate services due to suspension or closure of business, they shall publish a reminder of changes in business conditions in conspicuous locations such as service venues and web portals 30 days in advance, promptly refund the remaining fees, properly resolve follow-up service problems, and bear the responsibility of business entities in accordance with law. If a dispute arises between a pension institution and the elderly or their agent due to a refund, the two parties may resolve it through negotiation, mediation, complaints, arbitration, litigation, etc.
3. Strengthen diversified supervision and management
(9) Implement the management of bank depository and risk margin. Deposits and membership fees shall be managed by means of third-party depository and risk deposits of commercial banks to ensure the safety of funds. The civil affairs department shall, in conjunction with the local financial regulatory department, formulate depository rules such as specific requirements, handling procedures, rights and obligations of pension institutions and depository banks, and determine the list of all commercial banks undertaking business based on factors such as credit status, service level, risk control ability, and human resources, and publish it to the public. Within the scope of the published list, pension institutions shall independently select the depository bank, sign a tripartite depository agreement with the civil affairs department and the depository bank responsible for supervision, open a special deposit account, and report to the civil affairs department responsible for supervision in a timely manner if there is any change or cancellation of the account. Pension institutions in accordance with the budget unit management, its account opening, use should also comply with the relevant provisions of the financial department at the same level. The depository bank shall perform the fund depository obligation in accordance with the depository agreement, and shall not provide guarantee for the pension service, and the pension institution shall not use the depository bank for marketing and publicity. The pension service fees collected in advance by the pension institutions shall be deposited into their basic deposit accounts in a timely manner, and the deposits and membership fees shall be deposited in the special deposit accounts of the depository in a timely manner. It is not allowed to use accounts other than the basic deposit account of the institution, the special deposit account deposited by the institution, or the account of the institution or other personal accounts for fee transfer. Where the elderly or their agents pay in cash, the pension institutions shall promptly deposit them into the corresponding accounts of the institutions. The special deposit account of the pension institution shall retain a certain amount of funds as a risk deposit, and the specific proportion shall be determined by the provincial civil affairs department, but the retention ratio shall not be less than 10% of the total membership fee of the account in the past three years (if it is collected for less than three years, it shall be calculated according to the total amount of membership fees collected), and shall not be less than 20% of the current balance of the account. When the balance of the special deposit account is close to the minimum proportion of risk margin, the depository bank shall give early warning to the pension institution. When there is an abnormal flow of funds in the special deposit account and the account balance reaches the minimum proportion of risk margin, the depository bank shall not handle the expenditure for the pension institution except for the refund, and shall make a risk warning to the civil affairs department responsible for supervision, and report the relevant situation to the local financial regulatory department and the leading department for the disposal of illegal fundraising in a timely manner. Provincial-level civil affairs departments, in conjunction with provincial-level financial regulatory departments, should refine and determine the circumstances of abnormal capital flows. The depository bank shall establish an account management system for pension institutions, collect information on the collection and use of funds of pension institutions, and connect with the information system of the civil affairs department. The civil affairs department should rely on the information system to strengthen the supervision of the pension institutions in advance fees, and if it is found that the pension institutions are suspected of illegal fund-raising, they should report the relevant situation to the depository bank. In accordance with the provisions of the law and the depository agreement, the depository bank shall take corresponding restrictive measures against the special deposit account.
(10) Strengthen routine supervision and risk monitoring. The civil affairs departments shall, through portals and other channels, disclose to the public the information on the prepayment of fees by pension establishments in accordance with laws and regulations. The civil affairs department should include the advance fee into the "double random, one open" supervision of the key inspection items, entrust social intermediaries to a certain proportion of the pension institutions pre-charge collection and management, use and other situations to conduct spot checks and audits, the daily inspection and individual inspection found in the outstanding or general problems, can be jointly carried out by relevant departments to carry out special inspections. Departments such as for civil affairs and market regulation should promptly aggregate information such as administrative penalties and spot check results generated in the course of the supervision of advance fees for elderly care establishments to the relevant credit information platforms and publicize them in accordance with law. All localities should rely on the national pension service information system, illegal fundraising monitoring and early warning platform, etc., to explore the establishment of key risk indicator monitoring models, and regularly issue risk early warning tips. Encourage all localities to actively introduce insurance mechanisms to provide risk protection for the elderly to pay advance fees.
(11) Categorical disposal of hidden dangers. If the departments of civil affairs, market supervision and other departments find that there are problems such as irregular pre-charging behavior of pension institutions in their daily supervision, they should conduct a warning interview with their legal representative (main responsible person), and urge them to make rectifications in place and operate in accordance with laws and regulations. Where there are problems such as the illegal collection and use of advance fees, the civil affairs departments should order corrections to be made within a set period of time, and where corrections are not made within the time limit, and where there is a risk that might endanger the property safety of the elderly, order a suspension of business for rectification; If it is discovered that there may be a risk of illegal fundraising, it shall promptly notify the lead department for the disposal of illegal fundraising, and conduct a warning interview and order rectification separately or jointly with the lead department for the disposal of illegal fundraising; If suspected illegal fundraising is discovered, report it to the local people's government as soon as possible, and notify the lead department for the disposal of illegal fundraising in a letter, and cooperate with the investigation and subsequent disposal in accordance with the law; Where suspected crimes are discovered, they are to be transferred to the public security organs in accordance with law. For pension establishments that engage in illegal fundraising in the name of advance fees, the civil affairs departments should strengthen credit punishment in accordance with laws and regulations, and cooperate with relevant departments to do a good job of handling emergencies and maintaining stability.
Fourth, the implementation of the guarantee organization
(12) Do a good job of implementation. Provincial-level civil affairs departments should take the lead in formulating implementation rules or promulgating corresponding management measures in light of local conditions, and refine management requirements and specific measures; Improve the implementation of the model text of the pension service agreement, and guide and standardize the signing and performance of the contract. All localities should improve working mechanisms, clarify the division of responsibilities, implement territorial regulatory responsibilities, and ensure that regulatory measures are effective; It is necessary to smooth the channels for complaints and reports, and strengthen interconnection and regular research and judgment on the clues of the illegal collection and use of advance fees, non-refunds or delays in refunds without reason, and abnormal flow of funds in pension institutions, so as to find emerging risks and deal with them in a timely and prudent manner. The Ministry of Civil Affairs, in conjunction with relevant departments, should follow up, supervise, and inspect the implementation of these Opinions, to ensure that all measures are effective.
(13) Strengthen departmental coordination. The civil affairs department should regulate and supervise the prepayment of fees by pension institutions in accordance with the law, and take the lead in risk investigation and monitoring and early warning. The development and reform and financial departments shall, in conjunction with the civil affairs departments, improve and improve the charging policies of public and private inclusive pension institutions, and standardize the charging items and charging standards. The lead department for the handling of illegal fundraising, the local branch of the financial management department of the State Council, and the dispatched agency shall establish a monitoring mechanism for suspicious funds for illegal fundraising, and supervise and guide commercial banks and non-bank payment institutions to strengthen the monitoring of abnormal capital flows and other suspected illegal fundraising suspicious funds in accordance with their duties and division of labor. Branches of the People's Bank of China should coordinate with commercial banks to facilitate the opening of special deposit accounts for pension institutions. The market supervision department should strengthen the spot check and inspection of the charging behavior of pension institutions, and investigate and punish the illegal price behaviors such as non-implementation of government pricing, government-guided prices and non-compliance with regulations. The public security organs should strengthen coordination and cooperation with the departments of civil affairs, the People's Bank of China, market supervision, financial supervision and other departments, and crack down on illegal fund-raising, fraud and other criminal acts carried out by pension institutions in the name of pre-charging in accordance with the law.
(14) Do a good job of policy convergence. Advance fees for elderly care institutions shall be fully included in the scope of supervision, including advance fee funds that have been collected but not completed before the issuance of these Opinions. Provincial-level civil affairs departments should set up a reasonable transition period, and pension establishments that have already collected deposits and membership fees before the issuance of these Opinions shall urge them to complete formalities such as opening special deposit accounts and reporting information during the transition period. In areas where measures for the management of advance fees have been introduced, it is necessary to do a good job in the convergence and application of policies. If the prepayment of pension institutions falls within the scope of adjustment of the relevant provisions on the management of single-purpose prepaid cards in the locality, the relevant provisions shall also be complied with.
These Opinions shall take effect on October 1, 2024, and shall be valid for 5 years.
Civil affairs
National Development and Reform Commission
Public security
treasury
People's Bank of China
State Administration for Market Regulation
General Directorate of Financial Supervision
April 23, 2024