Applicant:Beijing Unirule Institute Consulting Co., Ltd.

UnifiedSocial Credit Code: 91110108700384359B.

Placeof residence: 601-31, 6th floor, No. 1 Courtyard, Shangdi East Road, HaidianDistrict, Beijing.

Legalrepresentative: Sheng Hong, Executive Director

Address:  1001, Unit 3, Building 18, Xinlongcheng PhaseI, Changping District, Beijing, telephone 82540480, 13501058937, 13511010880.

Respondent:Haidian Branch of Beijing Administration for Industry and Commerce

LegalRepresentative: Liu Chunmei, Director-General

Placeof residence: No. 9 Daozuo Temple, Haidian District, Beijing

Tel:82692077 Fax: 82692011 Zip Code: 100080

Requestsfor administrative reconsideration:

Theapplicant submitted an application for reconsideration to the BeijingAdministration for Industry and Commerce for refusing to accept the"Administrative Penalty Decision" made by the respondent on October22, 2018, and requests the cancellation of the "Administrative Penalty Decision"   by Haidian Branch of the BeijingAdministration for Industry and Commerce (No.2011 ).

Facts and Reasons:

OnOctober 22, 2018, the Haidian Branch of Beijing Administration for Industry andCommerce (hereinafter referred to as "the respondent ") of therespondent made the Beijing Administration for Industry and Commerce No. 2011"Decision on Administrative Penalties" and decided to revoke theapplicant's business license. In the applicant's opinion, the administrative penaltyfor revoking the applicant's business license by the respondent violates thespirit of the Constitution and has no factual and legal basis.

1. The penalty violates Article47 of the Constitution of the People's Republic of China.

Article47 of the Constitution stipulates that "citizens of the People's Republicof China have the freedom to conduct scientific research, literary and artisticcreation and other cultural activities. The state encourages and helps citizensengaged in educational, scientific, technological, literary, artistic and othercultural undertakings in creative work beneficial to the people." Thepurpose and result of this punishment is to deprive our company of theconstitutional rights stipulated in Article 47 of the Constitution and to weakenthe constitutional principle of protecting the constitutional rights of allcitizens and institutions.

2. A whistleblower whoinitiates the punishment conceals his true identity information and thereforecannot be regarded as a legitimate whistleblower.

Oneof the evidences on which the respondent made the decision of punishment is thetransfer letter of case clues provided to it by an unnamed secret institution.According to basic jurisprudence, the whistleblower should be a "nominalindependent" person, that is, a natural or legal person with a clear legalidentity, who can bear legal responsibility and consequences. If awhistleblower conceals his true identity information, he should be consideredunwilling to bear the legal responsibility and consequences of his own actions,even with improper purposes. Therefore, this whistleblower's action cannot beregarded as a lawful and effective whistle-blowing.

3. The key evidence on whichthe punishment is based - the testimony of Haidian District Education Committeeis false.

Article12 of the Law on the Promotion of Private Education stipulates that:"Private schools that carry out diploma education, pre-school education,self-taught examination and other cultural education shall be examined andapproved by the educational administrative departments of the people'sgovernments at or above the county level in accordance with the limits ofauthority prescribed by the state. Private schools that carry out vocationalqualification training and vocational skill training mainly based on vocationalskills shall be examined and approved by the administrative departments ofhuman resources and social security of the people's governments at or above thecounty level within the limits of authority prescribed by the State, and copythem to the administrative departments of education at the same level for therecord." According to the clear stipulation here, the applicant is not a"private school" for academic education or vocational training.

First,according to the Law on the Promotion of Private Education, "PrivateSchools" should have "training objectives, scale, level, form,conditions and internal management system, etc." According to theRegulations on the Establishment and Management of Private Non-academicEducation and Training Institutions in Beijing, the standard settings of"Private Schools" or similar private educational institutions are asfollows:

Article 5 Private non-academiceducation and training institutions shall meet the following requirements:

(1) ......

(2) The proposed principal of anon-academic educational institution is not more than 70 years old, healthy andable to take charge of daily work full-time. He has a professional title at orabove the intermediate level or a bachelor's degree at a university, and hasmore than five years' relevant educational and teaching experience.

(3) It has a stable source offunds for running schools, with a registered capital of not less than 500,000yuan (of which 200,000 yuan is venture capital).

(4) There are relatively stableschool-running sites and teaching rooms that can meet the needs of teaching.The area of the school buildings is not less than 500 square meters, of whichthe teaching area is not less than 80%. Housing property rights are clear,lease or use period is not less than 3 years, suitable for running schools, nosecurity risks. Residents' houses and basements shall not be used as places forrunning schools. Classrooms and offices should be located in one place.

(5) There should be no lessthan 40 new type computers for computer professional training; otherspecialized training should have teaching equipment and places suitable for thescale of running a school; and a certain number of books and materials.

(6) If a non-full-time highereducation self-study examination assistant counseling institution is held, itstotal building area shall not be less than 1000 square meters; if a full-timehigher education self-study examination assistant counseling institution isheld, its total building area shall not be less than 3000 square meters, andthe building area of per student shall not be less than 10 square metersaccording to the scale of the school. The total value of the equipment shouldbe no less than 1 million yuan and the books and materials should be no lessthan 10,000 volumes. Full-time teachers shall be allocated according to theratio of students to teachers not less than 20:1, and students' educationadministrators such as head teachers shall be allocated in accordance withrelevant regulations.

(7) Non-academic education andtraining institutions shall establish a board of directors, a board ofdirectors or other decision-making bodies (the number of members shall be noless than 5 singular), of which more than one third of the directors shall havemore than 5 years of educational and teaching experience.

(8) Training with strongprofessionalism and great impact on citizens' physical and mental health andsafety must be examined by the relevant administrative departments of thegovernment. Private non-academic education and training institutions shall notconduct military, police, religious and political training.

(9) There are perfectschool-running regulations, teaching plans or plans.

(10) More than two financial personnelwith professional qualifications.

(11) There are a certain numberof teachers who are suitable for the specialty and scale of the school.

(12) More than two full-timeadministrators.

Butthe evidence of Haidian District Education Committee,

(1)There is no definition and standard for judging what is a "privateschool" according to Article 12 of the Law on Promotion of PrivateEducation and the Regulations on the Establishment and Management of PrivateNon-academic Education and Training Institutions in Beijing.

(2)There is no description what is the "training objective" of BeijingUnirule Institute Consulting Company?

(3)There is no indication of the "school-running scale" of the BeijingUnirule Institute Consulting Company.

(4)It does not explain what the "level, form, conditions, internal managementsystem and so on" of Beijing Unirule Institute Consulting Company are.

(5)It does not prove that there are full-time teachers at Beijing Unirule Institute Consulting Company ;

(6)There is no evidence that Beijing Unirule Institute Consulting Company hasregular enrollment;

(7)There is no proof that Beijing Unirule Institute Consulting Company has 500square meters of school buildings;

(8)There is no evidence that the Beijing Unirule Institute Consulting Company hasother conditions requiring a "private school" as stipulated in theRegulations on the Establishment and Management of Private Non-academicEducation and Training Institutions in Beijing.

Inthe absence of definitions, criteria and corresponding facts, this evidenceonly gives an arbitrary conclusion, which is a false evidence.

4. The testimony of HaidianDistrict Education Committee is the expansion of self-authority

Secondly,"education" in Chinese can be divided into broad sense and narrowsense. Generally speaking, "education" refers to all the spiritualand ideological communication activities that affect the development of humanmind. For example, visiting museums, watching movies, series of lectures,salons, reading clubs, going to nursing homes to offer condolences, students'work-study programs, etc., and even "teaching by doing" and "Atalk with you is better than ten-years reading". In a narrow sense,education refers to the education organized by special organizations, that is,school education. Although the Education Law and the Promotion Law of PrivateEducation have no definitions of education, it is obvious that they only aim atthe concept of narrow education, otherwise they will cover all spiritual andideological communication activities. The above-mentioned spiritual andideological dissemination activities carried out by our company are obviouslynot within the scope of "diploma education, pre-school education,self-study examination and other cultural education" referred to inArticle 12 of the Private Education Promotion Act, even though the concept of"other cultural education" mentioned therein is more narrowly definedand cannot be extended to the broad educational field in which our company isengaged. If we can't prove that our company is a "private school",the testimony of Haidian District Education Committee is to assign the approvalof the administrative license which obviously should not be under itsjurisdiction to its jurisdiction, which is a self-authorized self-authorityexpansion. Article 82 of the Legislative Law of the People's Republic of Chinastipulates that "without the basis of laws or administrative regulations,decisions and orders of the State Council, departmental rules and regulationsshall not set norms that impair the rights of citizens, legal persons and otherorganizations or increase their obligations, nor shall they increase thedepartments' powers or reduce their statutory duties." Haidian DistrictEducation Committee is not a department that can set up "departmentrules". However, its decision of administrative punishment violates theprovisions of the Legislative Law, impairs the rights of citizens, legalpersons and other organizations or increases the norms of their obligations, increasesthe powers of the department or reduces the legal responsibilities of thedepartment.

5. The applicant has notchanged his business scope

Accordingto the provisions of Article 68 of the Regulations on the Administration ofCompany Registration, the respondent has the power of administrative punishmentfor the illegal acts involved in the change of business scope of the company.There are clear provisions in laws and regulations on how to change the scopeof business. Article 12 of the Company Law stipulates: "The scope ofbusiness of a company shall be stipulated in its articles of association andregistered according to law. A company may amend its articles of associationand change its business scope, but it shall register the changes."Therefore, the change of business scope of a company should refer to the changein the articles of association of the company, rather than the over-rangeoperation in the actual business process. Similarly, Article 32 of theRegulations on the Administration of Company Registration stipulates that if acompany changes its business scope, it shall apply for change registrationwithin 30 days from the date of making the resolution or decision on change; ifthe change of business scope involves a project that must be approved beforeregistration as stipulated by laws, administrative regulations or the decisionof the State Council, it shall apply for changing registration within 30 daysfrom the date of approval by the relevant state departments. . " Thisfurther clarifies that the criterion for a company to change its business scopeis to make a resolution or decision to change its business scope, not to engagein business outside its business scope.

Therefore,the term "when a company registers a change" as stipulated in Article68 of the Regulations on the Administration of Company Registration refers to"making a resolution or decision to change" as stipulated in Article32, and the premise of punishment is to violate the legal obligationsstipulated in Article 32. Then, since the obligation stipulated by Article 32to a company is only "to apply for change within 30 days from the date ofmaking a change resolution or decision", and if the company does not makea change decision or resolution, of course, it is not regulated by thisarticle, and it will not bear the legal responsibility stipulated in Article 68for violating this article.

6. The respondent tailed toperform the Pre-Procedure of Administrative Punishment in accordance with theprovisions of Article 68 of the Regulations on the Administration of CompanyRegistration

Thepre-procedure for punishment should be ordered to register within a time limit,whether it is a fine or a revocation of business license. It is wrong to arguethat the revocation of business licenses does not require a deadline forchanging registration, for the following reasons:

Firstof all, from the wording of the first paragraph of this article, we can seethat the second sentence uses "among them" as a conjunction,indicating that the situation described in the second sentence is contained inthe situation described in the first sentence. The first sentence requires theadministrative organ to perform the pre-procedure of ordering the deadlineregistration before punishment. Therefore, the second sentence naturallyrequires the administrative organ to perform the pre-procedure of ordering thedeadline registration. 。

Secondly,the Regulations on the Management of Company Registration only stipulate thelegal obligations and responsibilities of company registration. Failure tofulfill the obligation of changing registration is the premise of punishment,while unauthorized operation is only the condition of aggravating punishment,not the element of separate punishment. After the administrative organ foundthe failure to fulfill the obligation of registration for change, there is noexception to the procedure of ordering the company to correct by theadministrative organ, which is embodied in the Article 32 of the AdministrativePunishment Law: "When the administrative organ carries out administrativepunishment, the party concerned shall be ordered to correct or rectify theillegal act within a time limit." If the business license is revokeddirectly, the party concerned has no possibility to correct the illegal act.

Thirdly,if we think that the penalty of revoking business license does not need thepre-procedure of ordering the deadline registration, then there is a logicalcontradiction in the provisions of this article. For example, there may becases where a company carries out business activities without permission, butthe circumstances are not serious. How to punish? Obviously, the businesslicense cannot be revoked, but if a fine is imposed, it can only be based onthe provisions of the first sentence, and the penalty stipulated in the firstsentence is based on the premise of ordering the registration within the timelimit to be overdue. If denying the need to order the registration within thetime limit, it is obviously impossible to impose a fine on the basis of thisarticle. Then, according to the understanding of the respondent, there will beno penalty for such violations, which obviously violates the basic legal logic.

7. The respondent has no powerinstead of the educational administrative organ to perform supervisory duties.

Actually,the respondent's behavior replaces the administrative department of educationin fulfilling the supervisory responsibility for the relevant administrativelicense.

Article12, paragraph 2, of the Company Law stipulates that: "The items within thescope of business of a company that are subject to approval under laws andadministrative regulations shall be approved in accordance with the law."However, the Company Law does not authorize the company registration authorityto punish illegal acts. So the illegal act can only be punished according tothe provisions of the Administrative Licensing Law. Article 81 of theAdministrative Licensing Law stipulates that: "If a citizen, legal personor other organization engages in activities that should be grantedadministrative license according to law without administrative license, theadministrative organ shall take measures to stop them and impose administrativepenalties according to law; if a crime is constituted, criminal responsibilityshall be investigated according to law." The "administrativeorgan" here mainly refers to the executive organ of the administrativelicense, and the administrative organ exercising the power of punishment shouldbe determined according to the relevant laws, regulations or decisions of theState Council. Article 5 of the Measures for Investigation and Punishment ofUnlicensed and Unlicensed Business Operations stipulates that: "If anoperator fails to obtain permission to engage in business activities accordingto law, it shall be investigated and punished by the departments prescribed bylaws, regulations and decisions of the State Council; if the laws, regulationsand decisions of the State Council are not prescribed or unclear, thedepartments determined by the people's governments of provinces, autonomousregions and municipalities directly under the Central Government shall Article6 stipulates: "If an operator fails to obtain a business license inaccordance with the law to engage in business activities, it shall beinvestigated and dealt with by the department performing the duties ofindustrial and commercial administration (hereinafter referred to as theadministrative department for Industry and commerce). Document No. 35 of Guofa[2018] also clearly stipulates the subject of supervision: "To implementthe principle of" who examines and approves, who regulates; who supervisesand who regulates", the competent authorities of the industry should bearthe responsibility of supervision effectively..." However, in the Circularof the General Administration of Industry and Commerce on Implementing theMeasures for Investigation and Punishment of Unlicensed and Unlicensed Business(Industry and Commerce Word [2017] 169), the understanding of the Measures forInvestigation and Punishment is very accurate: "The Measures forInvestigation and Punishment, in accordance with the new requirements ofstrengthening supervision after the reform of ‘license first, permit second’,clarifies the powers of the departments for Industry and Commerce toinvestigate and punish unlicensed business. To clarify the responsibilities ofsupervision is conducive to the establishment of a clear power andresponsibility, smooth communication, co-management, transparent and efficientafter-the-event supervision system,... The Measures for Investigation andDisposal expand the scope of business activities that do not belong tounlicensed and unpermitted business activities. It further clarifies the principlesof investigation and punishment combined with guidance and punishment combinedwith education. According to the principle of 'who examines and approves, whoregulates; who supervises, who regulates', and based on the statutoryresponsibilities, the three situations of 'unlicensed operation', 'unpermittedoperation' and 'unlicensed and unpermitted operation' are reasonablydistinguished, the supervisory responsibilities of various departments areclarified, and the post-event supervisory system is further improved. Alllocalities should accurately grasp, resolutely implement and actively carry outtheir work."

Itcan be seen that the administrative departments for Industry and Commerce haveonly the power to investigate and punish unlicensed operations, but not thepower to investigate and punish unlicensed operations.

Article12 of the Law on the Promotion of Private Education stipulates that theexamining and approving organ is the administrative department of education orthe administrative department of human resources and social security. Theindustrial and commercial organs have no examining and approving power, andnaturally have no supervising power. Article 64 of the Law stipulates: "Ifa private school is set up without authorization in violation of the relevantprovisions of the State, the administrative department of education or humanresources and social security of the local people's government at or above thecounty level in conjunction with the relevant departments of public security,civil affairs or industrial and commercial administration at the same levelshall order it to stop running the school and return the fees charged, andimpose on the organizer more than twice and more than five times the illegalincome." Fines shall be imposed; if violations of public securityadministration are constituted, the public security organs shall imposepenalties on public security administration according to law; if a crime isconstituted, criminal responsibility shall be investigated according tolaw." It can be seen that the administrative organs for Industry and commercecan only cooperate with the implementing organs of relevant administrativelicenses to punish, and do not include the penalty of revoking businesslicenses. The reason for this is that judging whether an administrative licenseis required requires the professional judgment of the administrative organs invarious specialized fields, while the company registration organs cannot haveprofessional judgment ability in all industries and administrative fields todetermine whether their business activities are within the scope ofadministrative license.

Inshort, the administrative departments for Industry and Commerce have no rightto investigate and deal with "unpermitted" business practices.

8. Summary: This case does notsatisfy the elements of illegality

Article68, paragraph 1, of the Regulations on the Administration of CompanyRegistration stipulates that if a company's registered items change, it failsto register the relevant changes in accordance with the provisions of theseRegulations, the company registration authority shall order it to registerwithin a time limit; if it fails to register within the time limit, it shall befined not less than 10,000 yuan but not more than 100,000 yuan. Among them, thechange of business scope involves the project which must be approved by law,administrative regulations or the decision of the State Council, but has notbeen approved, and engages in relevant business activities withoutauthorization. If the circumstances are serious, the business license shall berevoked." According to Article 32 of the Law, there are two possible legalliabilities for violating the provisions on registration of change: one is toimpose a fine, the other is to revoke the business license. The constituentelements of the two are as follows:

Firstly,the penalty needs to be satisfied: 1. the company makes a change resolution ordecision; 2.the company fails to apply for change registration within 30 daysafter making the decision; 3. the company registration authority orders it toregister within a time limit; 4. no registration within the time limit.

Secondly,because the second sentence of this paragraph stipulates "among them"as a qualifying condition, the "its" here is the situation stipulatedin the first sentence, so the revocation of business license should meet thefollowing requirements: 1. the company makes a change resolution or decision;2..the company fails to apply for change registration within 30 days aftermaking the decision; 3. the company registration authority orders itsregistration within a time limit; 4. no registration within the time limit; 5.changing the scope of business must be licensed but failed to obtain; 6.unauthorized business activities that need to be licensed; 7. seriouscircumstances.

Inthis case, the proposed penalty for revoking the business license of thecompany can not meet the above conditions, even one condition is not satisfied,of course, should not be punished. Moreover, the respondent is not the subjectof punishment right of "undocumented" operation.

Tosum up, the specific administrative act of the respondent to revoke theapplicant's business license has no factual and legal basis, requesting aruling according to law to support the applicant's application.

To

BeijingAdministration for Industry and Commerce

BeijingUnirule Institute Consulting Co., Ltd.

Legalrepresentative (signature):

Dec.10, 2018