Short answer: Commercial bribery is the private-sector version of bribery — paying or rewarding an employee of a company or other organization (not a government official) to obtain an improper business advantage. It is a crime in China. Employees who take such payments can be prosecuted under Article 163 of the Criminal Law, and the people or companies who pay them face prosecution under Article 164. Sentences reach up to ten years for large amounts, and the employee who takes the bribe can face even longer — up to life imprisonment — in especially serious cases.

What does the law say?

Article 163 targets the receiving side: an employee of a company or other organization who uses his or her position to demand or accept money or property in exchange for favoring the payer. For a relatively large amount, the penalty is up to three years in prison plus a fine; for a large amount, three to ten years plus a fine; and for an especially large amount, ten years to life plus a fine. Article 164 targets the paying side: giving money or property to such an employee to seek improper business advantage carries up to three years for a relatively large amount, and three to ten years for a large amount, plus fines. If a company makes the payment, the company itself is fined and the responsible managers can also be prosecuted.

One important distinction: this private-sector crime is separate from official corruption. If the recipient is a state functionary — for example, an employee of a state-owned enterprise who performs public duties — the case falls under the official bribery and corruption provisions (Articles 385, 389 and 390), which carry harsher penalties.

What counts as commercial bribery in practice?

The typical cases we see are procurement kickbacks: a supplier paying a “success fee” or “consulting fee” to a customer’s purchasing manager; sales commissions paid into an employee’s personal account; or expensive gifts and travel given to influence a contract decision. Not every gift is a crime — modest, transparent business courtesies that are properly recorded are normal. What crosses the line is a payment linked to a specific decision, made secretly and for the employee’s personal benefit. The criminal filing thresholds are set by the Supreme People’s Procuratorate and the Ministry of Public Security, and even five-figure amounts can trigger a case in the private sector, so “it was only a small kickback” is not a defense.

Hypothetical example

A sales director of a foreign supplier pays RMB 80,000 in cash to the purchasing manager of a private Chinese manufacturer to win a supply contract. If discovered, the purchasing manager can be prosecuted under Article 163 and the sales director under Article 164. If the payment was routed through the supplier company, the company itself can also be fined, and the employer may add a civil claim for its losses.

Bottom line: in China, bribing a business partner’s employee is not a gray-area “commission” — it is a criminal offense for both sides, and foreign executives are not exempt.

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Frequently asked questions

Q: What does the law say?

A: Article 163 targets the receiving side: an employee of a company or other organization who uses his or her position to demand or accept money or property in exchange for favoring the payer. For a relatively large amount, the penalty is up to three years in prison plus a fine; for a large amount, three to ten years plus a fine; and for an especially large amount, ten years to life plus a fine.

Q: What counts as commercial bribery in practice?

A: The typical cases we see are procurement kickbacks: a supplier paying a “success fee” or “consulting fee” to a customer’s purchasing manager; sales commissions paid into an employee’s personal account; or expensive gifts and travel given to influence a contract decision. Not every gift is a crime — modest, transparent business courtesies that are properly recorded are normal.

Wang Guan | Co-founder, Beijing Haolue Law Firm | +86 17813108512