Regulations on Administration of Business Premises for Internet Access Services

(Adopted at the 62nd Executive Meeting of the State Council on
August 14, 2002, promulgated by Decree No. 363 of the State Council
of the People’s Republic of China on September 29, 2002, and
effective as of November 15, 2002)

Chapter I General Provisions

Article 1 These Regulations are formulated for
the purposes of strengthening the administration of business
premises for Internet access services, standardizing business
conducts of operators, protecting the lawful rights and interests
of the general public and operators, maintaining a healthy
development of business activities providing Internet access
services, and promoting socialistic ideological and ethical
progress.

Article 2 As used in these Regulations, the
term “business premises for Internet access services” refers to
business premises such as Internet bars or computer lounges where
Internet access services are provided to the general public by
means of computers or other devices.

Premises affiliated to schools, libraries or other units where
Internet access services are provided to particular persons for
acquiring information and data shall comply with the relevant laws
and regulations, and these Regulations are not applicable
thereto.

Article 3 Units operating business premises for
Internet access services shall comply with the relevant provisions
of laws and regulations, strengthen industry self-discipline,
self-consciously accept the inspection and administration by
government departments concerned in accordance with the law, and
provide consumers of Internet access services with desirable
services.

Consumers of Internet access services in business premises for
Internet access services shall comply with the relevant provisions
of laws and regulations as well as social ethics, and conduct
Internet-surfing activities in a civilized and healthy way.

Article 4 The culture administration
departments of the people’s governments at or above the county
level shall be responsible for examining and approving the
establishment of units operating business premises for Internet
access services, and be responsible for supervising and
administering the business activities of the legally established
units operating business premises for Internet access services; the
public security organs shall be responsible for supervising and
administering the security of information networks, public security
and fire control; the administrative departments for industry and
commerce shall be responsible for the registration of the units
operating business premises for Internet access services, and the
administration of their business licenses, and for investigating
and punishing unlicensed business activities; the
telecommunications administration departments and other departments
concerned shall conduct supervision and administration of the units
operating business premises for Internet access services within
their respective responsibilities and duties according to the
relevant provisions of these Regulations, laws and administrative
regulations.

Article 5 The culture administration
departments, the public security organs, the administrative
departments for industry and commerce, as well as other relevant
departments and their staff shall not engage in, or engage in in a
disguised form, any business activities providing Internet access
services, nor participate in, or participate in in a disguised
form, any business activities conducted by the units operating
business premises for Internet access services.

Article 6 The State encourages citizens, legal
persons and other organizations to supervise the business
activities conducted by the units operating business premises for
Internet access services, and rewards those who have made
outstanding contributions.

Chapter II Establishment

Article 7 The State adopts the license system
for the business activities conducted by the units operating
business premises for Internet access services. Without being
licensed, no organization or individual may set up any business
premises for Internet access services, or engage in any business
activities providing Internet access services.

Article 8 A unit
operating business premises for Internet access services shall be
incorporated as an enterprise, and shall satisfy the following
conditions:

(1) possessing a title, domicile, organizational structure and
articles of association;

(2) possessing appropriate capital for business activities;

(3) possessing business premises that are commensurate with its
business activities and meet the requirements set by the State for
fire control;

(4) possessing sound and complete management systems for the
security of information networks as well as technological security
measures;

(5) possessing a permanent website address and such equipment as
computers and their attached devices that are commensurate with the
business activities;

(6) possessing security administration staff, managerial staff
and technical professionals who are commensurate with its business
activities and obtain the qualifications for practicing the
business; and

(7) other conditions set forth by laws and administrative
regulations as well as by the relevant departments of the State
Council.

The minimum business area of the business premises for Internet
access services, the number of such equipment as computers and
their attached devices, and the standard of the area for each
computer shall be determined by the culture administration
department of the State Council.

In addition to the conditions provided in paragraphs (1) and (2)
of this Article, the examination and approval of the units
operating business premises for Internet access services shall also
be subject to the requirements set forth by the culture
administration department of the State Council and the culture
administration departments of the people’s governments of
provinces, autonomous regions and municipalities directly under the
Central Government for the total number and layout of the units
operating business premises for Internet access services.

Article 9 No business premises for Internet
access services may be established at a distance not more than 200
meters from high schools and primary schools or within residential
buildings (compounds).

Article 10 To establish a unit operating
business premises for Internet access services, an application
therefor shall, accompanied by the following documents, be
submitted to the culture administration department of the local
people’s government at or above the country level:

(1) a notice of advance approval of its title and its articles
of association;

(2) materials certifying the identity of its legal
representative or its principal responsible person;

(3) certification of capital and creditworthiness;

(4) property right certification, or a letter of intent on lease
of, the business premises; and

(5) other documents needed to be submitted according to law.

Article 11 The culture administration
department shall make a decision within 20 workdays from the date
of receipt of the establishment application, and issue the approval
document that permits the preparations for the establishment to
those proved to be in conformity to the conditions after
examination.

After the completion of preparations for the establishment, the
applicant shall apply for the examination of information network
security and fire control security to the public security organ at
the same level on the basis of the approval document that permits
the preparations for the establishment. The public security organ
shall make a decision thereon within 20 workdays from the date of
receipt of the application, and issue an approval document to those
passing the examination after field inspection.

The applicant shall apply to the culture administration
department for final examination on the basis of the approval
document issued by the public security organ. The culture
administration department shall make a decision within 15 workdays
from the date of receipt of the application according to the
provisions of Article 8 of these Regulations, and issue a Permit
for Cyber-Culture Business to those passing the examination after
field inspection.

Where the culture administration department believes upon
examination that an application does not meet the conditions, or
where the public security organ believes that an application does
not comply with the requirements, it shall give the reasons
therefor to the applicant in writing.

Before putting into operation, the applicant shall apply to the
administrative department for industry and commerce for
registration on the basis of the Permit for Cyber-Culture Business
and draw the business license according to law.

Article 12 A unit
operating business premises for Internet access services shall not
alter, lease or lend its Permit for Cyber-Culture Business or
transfer it in any other forms.

Article 13 Where a unit operating business
premises for Internet access services changes the address of its
premises, or rebuilds or expands its premises, or changes the
number of computers or other important items, it shall obtain
approval from the original examining departments.

Where a unit operating business premises for Internet access
services changes its title, domicile, legal representative or
principal responsible person, registered capital, or website
address, or terminates its business activities, it shall go through
alteration registration or cancellation registration according to
law with the administrative department for industry and commerce,
and undertake the relevant procedures or put on a record with the
culture administration department and the public security
organ.

Chapter III Operations

Article 14 All units operating business
premises for Internet access services and consumers of Internet
access services shall not make use of the business premises for
Internet access services to create, download, reproduce, search,
release, spread or employ in other means the information involving
the following contents:

(1) opposing the basic principles set forth by the
Constitution;

(2) harming the unity, sovereignty or territorial integrity of
the State;

(3) divulging State secrets, harming State security or harming
State honor and interests;

(4) inciting national enmity or discrimination, undermining the
unity of the nationalities, or infringing upon national customs and
habits;

(5) undermining the State’s policy on religion, or advocating a
heresy or superstition;

(6) spreading rumors, disturbing the social order or undermining
social stability;

(7) advocating obscenity, gambling, violence or instigating a
crime;

(8) insulting or slandering another person, or infringing upon
another person’s lawful rights and interests;

(9) harming social ethics or excellent national cultural
traditions; or

(10) involving other contents prohibited by laws or
administrative regulations.

Article 15 All units operating business
premises for Internet access services and consumers of Internet
access services shall not conduct any of the following activities
that harm the security of information networks:

(1) intentionally creating or spreading computer viruses or
other destructive programs;

(2) illegally invading a computer information system or
destroying the functions, data or application programs of a
computer information system; or

(3) conducting other activities prohibited by laws or
administrative regulations.

Article 16 A unit
operating business premises for Internet access services shall be
connected to the Internet through an Internet access service
provider who has obtained an operation permit according to law, and
shall not be connected to the Internet by other
means.

The computers provided to consumers of Internet access services
by a unit operating business premises for Internet access services
shall be linked to the Internet through LAN, and shall not be
directly linked to the Internet.

Article 17 No unit operating business premises
for Internet access services may operate non-network games.

Article 18 All units operating business
premises for Internet access services and consumers of Internet
access services shall not make use of online games or take other
means to gamble or conduct any gambling activities in a disguised
form.

Article 19 A unit
operating business premises for Internet access services shall
implement technical management measures, establish an onsite
inspection system for the premises, and upon discovery of any
activities listed in Article 14, 15 or 18 of these Regulations or
any other illegal activities conducted by consumers of Internet
access services, stop them right away and report the case to the
culture administration department and the public security
organ.

Article 20 A unit
operating business premises for Internet access services shall hang
its Permit for Cyber-Culture Business and business license in a
prominent position in the premises.

Article 21 A unit
operating business premises for Internet access services shall not
admit minors to its premises.

A unit operating business premises for Internet access services
shall hang a no-minors-in sign in a prominent position at the
entrance to the premises.

Article 22 The business hours of each day for
the business premises for Internet access services shall be limited
between 0800 hours and 2400 hours.

Article 23 A unit
operating business premises for Internet access services shall
check and register the identity cards or other valid credentials of
consumers of Internet access services, and make a record on
relevant log-on information. The registered contents and copies of
the record shall be kept for a period not less than 60 days, and
shall be provided to the culture administration department and the
public security organ when they conduct inquiry according to law.
All the registered contents and copies of the record shall not be
modified or deleted within the save period.

Article 24 A unit
operating business premises for Internet access services shall
fulfill the responsibilities of maintaining the security of
information networks, public security and fire control security
according to law, and comply with the following
provisions:

(1) prohibiting lighting by flaming and smoking, and hanging the
no-smoking sign;

(2) prohibiting bringing in or storing any inflammable or
explosive goods;

(3) not allowing fitting any fixed bars sealing up doors or
windows;

(4) prohibiting blocking or locking up doors, windows, the safe
evacuation passage or emergency exit during business hours; and

(5) not allowing stopping the implementation of technical safety
measures without authorization.

Chapter IV Penalty Provisions

Article 25 Where the culture administration
department, the public security organ, the administrative
department for industry and commerce or other relevant departments
and their staff members take advantage of their office to accept
other persons’ money, property or other benefits, or illegally
approve the establishment of a unit operating business premises for
Internet access services that does not meet the statutory
requirements for establishment, or fail to fulfill the duty of
supervision according to law, or fail to investigate and deal with
the illegal acts that they discover according to law, thereby
violating the criminal law, the person directly in charge and other
directly responsible persons shall be investigated for criminal
liability in accordance with the provisions of the criminal law on
the crime of acceptance of bribes, the crime of power abuse, the
crime of neglect of duty or other crimes; those whose acts are not
serious enough for criminal punishment shall be given an
administrative sanction of demotion, dismissal from the post or
discharge from public employment according to law.

Article 26 Where any staff member of the
culture administration department, the public security organ, the
administrative department for industry and commerce or other
relevant departments is engaged in business activities providing
Internet access services or does so in a disguised form, or
participates in business activities of a unit operating business
premises for Internet access services or does so in a disguised
form, he shall be given an administrative sanction of demotion,
dismissal from the post or discharge from public employment
according to law.

Where the culture administration department, the public security
organ, the administrative department for industry and commerce or
other relevant department commits any of the acts specified in the
preceding paragraph, the person directly in charge and other
directly responsible persons shall be given administrative
sanctions in accordance with the provisions of the preceding
paragraph.

Article 27 Where anyone, in violation of the
provisions of these Regulations, establishes business premises for
Internet access services without authorization or engages in
business activities providing Internet access services without
authorization, the administrative department for industry and
commerce shall, solely or jointly with the public security organ,
ban such acts according to law, seal up the premises for the
illegal business activities, and impound the special instruments
and equipment for the illegal business activities; if the acts
violate the criminal law, he shall be investigated for criminal
liability in accordance with the provisions of the criminal law on
the crime of illegal operation; if the acts are not serious enough
for criminal punishment, the administrative department for industry
and commerce shall confiscate his illegal income and the special
instruments and equipment for illegal business activities; if the
illegal turnover is not less than 10,000 yuan, a fine of not less
than five times but not more than ten times of the illegal turnover
shall be imposed concurrently; if the illegal turnover is less than
10,000 yuan, a fine of not less than 10,000 yuan but not more than
50,000 yuan shall be imposed concurrently.

Article 28 Where a unit operating business
premises for Internet access services , in violation of the
provisions of these Regulations, alters, rents out, lends or
transfers in any other form its Permit for Cyber-Culture Business,
thereby violating the criminal law, it shall be investigated for
criminal liability in accordance with the provisions of the
criminal law on the crime of forging, altering, buying or selling
official documents, certificates or seals of a State organ; if its
acts are not serious enough for criminal punishment, the culture
administration department shall revoke its Permit for Cyber-Culture
Business and confiscate the illegal income; if the illegal turnover
is not less than 5,000 yuan, a fine of not less than two times but
not more than five times of the illegal turnover shall be imposed
concurrently; if the illegal turnover is less than 5,000 yuan, a
fine of not less than 5,000 yuan but not more than 10,000 yuan
shall be imposed concurrently.

Article 29 Where a unit operating business
premises for Internet access services, in violation of the
provisions of these Regulations, takes advantage of its premises to
create, download, reproduce, search, release, spread or use in any
other form any information involving the contents prohibited by the
provisions of Article 14 of these Regulations, thereby violating
the criminal law, it shall be investigated for criminal liability
according to law; if its acts are not serious enough for criminal
punishment, the public security organ shall give it a warning and
confiscate the illegal income; if the illegal turnover is not less
than 10,000 yuan, a fine of not less than two times but not more
than five times of the illegal turnover shall be imposed
concurrently; if the illegal turnover is less than 10,000 yuan, a
fine of not less than 10,000 yuan but not more than 20,000 yuan
shall be imposed concurrently; if the circumstances are serious, it
shall be ordered to suspend its business for rectification, or even
have its Permit for Cyber-Culture Business revoked by the culture
administration department.

An consumer of Internet access services who commits any of the
illegal acts specified in the preceding paragraph and thereby
violates the criminal law shall be investigated for criminal
liability according to law; if his acts are not serious enough for
criminal punishment, he shall be punished by the public security
organ in accordance with the provisions of the Regulations on
Administrative Penalties for Public Security.

Article 30 Where a unit operating business
premises for Internet access services, in violation of the
provisions of these Regulations, commits any of the following acts,
the culture administration department shall give it a warning, and
may concurrently impose a fine of not more than 15,000 yuan; if the
circumstances are serious, it shall be ordered to suspend its
business for rectification, or even have its Permit for
Cyber-Culture Business revoked by the culture administration
department:

(1) operating beyond the business hours;

(2) admitting minors to its premises;

(3) operating non-network games;

(4) stopping the implementation of technical management measures
without authorization; or

(5) failing to hang its Permit for Cyber-Culture Business or a
no-minors-in sign.

Article 31 Where a unit operating business
premises for Internet access services, in violation of the
provisions of these Regulations, commits any of the following acts,
the culture administration department or the public security organ
shall, in accordance with their respective functions and powers,
give it a warning, and may concurrently impose a fine of not more
than 15,000 yuan; if the circumstances are serious, it shall be
ordered to suspend its business for rectification, or even have its
Permit for Cyber-Culture Business revoked by the culture
administration department:

(1) failing to link the computers provided to consumers of
Internet access services to Internet through LAN;

(2) failing to establish an onsite inspection system for the
premises, or failing to stop illegal acts committed by consumers of
Internet access services upon discovery and report such acts to the
culture administration department or the public security organ;

(3) failing to verify and record the valid credentials of
consumers of Internet access services as required or failing to
record relevant log-on information;

(4) failing to keep the registered contents or copies of the
record within the required period, or modifying or deleting the
registered contents or copies of the record within the save period;
or

(5) failing to go through the relevant procedures or put on a
record with the culture administration department and the public
security organ when changing its title, domicile, legal
representative or principal responsible person, registered capital,
or website address, or terminating business activities.

Article 32 Where a unit operating business
premises for Internet access services, in violation of the
provisions of these Regulations, commits any of the following acts,
the public security organ shall give it a warning, and may
concurrently impose a fine of not more than 15,000 yuan; if the
circumstances are serious, it shall be ordered to suspend its
business for rectification, or even have its Permit for
Cyber-Culture Business revoked by the culture administration
department:

(1) lighting by flaming or failing to stop smoking upon
discovery, or failing to hang the no-smoking sign;

(2) allowing bringing in or storing any inflammable or explosive
goods;

(3) fitting fixed bars sealing up doors or windows on the
premises;

(4) blocking or locking up doors, windows, the safe evacuation
passage or emergency exit during business hours; or

(5) stopping the implementation of technical safety measures
without authorization.

Article 33 Where anyone violates the provisions
of the State on security of information networks, public security
administration, fire control administration, administration for
industry and commerce or telecommunication administration, and
thereby violating the criminal law, he shall be investigated for
criminal liability according to law; if his acts are not serious
enough for criminal punishment, he shall be punished by the public
security organ, the administrative department for industry and
commerce or the telecommunication administration department
according to law; if the circumstances are serious, his permit or
license shall be revoked by the original certificate-issuing
department.

Article 34 Where a unit operating business
premises for Internet access services has its Permit for
Cyber-Culture Business revoked as an administrative penalty for
violation of the provisions of these Regulations, it shall register
the alteration or cancellation with the administrative department
for industry and commerce according to law; if it fails to do so
after the time limit expires, the administrative department for
industry and commerce shall revoke its business license.

Article 35 Where a unit operating business premises for
Internet access services violates the provisions of these
Regulations and thereby has its Permit for Cyber-Culture Business
revoked, its legal representative or principal responsible person
shall not take the post of the legal representative or principal
responsible person of any unit operating business premises for
Internet access services within five years from the day when the
Permit for Cyber-Culture Business is revoked.

Where a unit operating business premises for Internet access
services established without authorization is banned according to
law, its principal responsible person shall not take the post of
the legal representative or principal responsible person of any
unit operating business premises for Internet access services
within five years from the day when it is banned.

Article 36 Where a fine is imposed as an administrative
penalty according to the provisions of these Regulations, the
separation of fine decisions from fine collections shall be
implemented in accordance with the relevant provisions of laws and
administrative regulations; all fines collected and illegal income
confiscated shall be turned over to the State Treasury.

Chapter V Supplementary Provisions

Article 37 These Regulations shall be effective as of November
15, 2002. The Measures for Administration of Business Premises for
Internet Access Services promulgated on April 3, 2001 by the
Ministry of Information Industry, the Ministry of Public Security,
the Ministry of Culture and the State Administration for Industry
and Commerce shall be repealed simultaneously.

(State Council)