Recently learned from the Ministry of Industry and Information Technology website, in order to promote state organs, institutions 

and large enterprises to pay small and medium-sized enterprises in a timely manner, to safeguard the legitimate rights and interests

 of small and medium-sized enterprises, in accordance with the Law of the People's Republic of China on the Promotion of Small 

and Medium-sized Enterprises and other laws, the Ministry of Industry and Information Technology drafted the administrative 

regulations "timely payment of small and medium-sized enterprises (draft for comments)" (hereinafter referred to as "draft for 

comments"), is now open to the public for comments, please feedback before October 7, 2019. 

The Draft for Comments mentions that state organs, institutions and large enterprises shall pay goods, works and services to 

small and medium-sized enterprises in a timely and full manner in accordance with the provisions of the law and the contract.

The Draft for Comments clearly stipulates that state organs, institutions and large enterprises purchasing goods, works and services

 from small and medium-sized enterprises shall pay within 30 days; If the contract stipulates inspection or acceptance as a condition

 of payment, the above-mentioned period may be extended for a maximum of 30 days. It does take longer because of the nature of

 the contract, except as otherwise provided by laws and administrative regulations. The terms of payment stipulated in the fore 

paragraph shall be calculated from the date of delivery of goods, works and services. If the contract stipulates that the payment 

conditions shall be based on bills, invoices or other documents issued by an small and medium-sized enterprise, the term of 

payment shall be calculated from the date on which the payment documents are served.

The Draft for Comments provides for the period of return of the warranty, and if the contract stipulates the reservation of quality 

security deposit, the state organs, institutions and large enterprises shall, in accordance with the contract, verify and settle with the 

small and medium-sized enterprises after the expiration of the period of quality assurance. If there is no objection to the verification 

or settlement results, state organs, institutions and large enterprises shall return the quality deposit within 15 days from the date of 

completion of verification and settlement.

The Draft for Comments proposes that if a state organ or institution delays the payment of funds to an SMEs due to financial 

difficulties, the competent department at the next higher level shall assume the obligation to pay the SME payment on behalf of 

the SME.

The Draft also mentions that if a large enterprise abuses its dominant position in the market to force small and medium-sized 

enterprises to accept unreasonable payment terms or delay the payment of small and medium-sized enterprises, the market 

supervision and administration department shall order them to make corrections and shall be fined between 100,000 yuan and 

500,000 yuan.

In addition, the drafting notes on the Draft for Comments also refer to the drafting of the Draft for Comments in order to

 implement the major decision-making and deployment of the CPC Central Committee to support the development of private 

enterprises and small and medium-sized enterprises, to refine the relevant legal system of the Law of the People's Republic of 

China on the Promotion of Small and Medium-sized Enterprises, and to promote the timely payment of small and medium-sized 

enterprises by state organs, institutions and large enterprises. It involves several aspects, from the point of view of the necessity of

 legislation, mentions the need to promote the development of private economy, the second is the need to implement the Law on 

the Promotion of Small and Medium-sized Enterprises, the third is to prevent and resolve the need for arrears of small and 

medium-sized enterprises;