To the housing and urban-rural development departments of all provinces and autonomous regions, the housing and urban-rural development (management) commissions of municipalities directly under the Central Government, and the housing and urban-rural development bureau of the Xinjiang Production and Construction Corps:

In order to carry out in depth the three-year action for tackling the root causes of work safety in housing and municipal engineering, step up the investigation and handling of illegal and non-compliant acts, and further regulate the order of the construction market, the investigation and handling of illegal and non-compliant acts such as illegal subcontracting and unlawful subcontracting in construction projects by housing and urban-rural development authorities across the country in 2023 are hereby notified as follows:

I. Investigation and handling of illegal and non-compliant acts such as illegal subcontracting and unlawful subcontracting in construction projects in various regions

In accordance with the work arrangements of the Ministry, all 31 provinces, autonomous regions and municipalities directly under the Central Government and the Xinjiang Production and Construction Corps reported to the Ministry on the investigation and handling of illegal and non-compliant acts such as illegal subcontracting and unlawful subcontracting in construction projects in 2023 (see the Annex for details). According to statistics, housing and urban-rural development authorities across the country inspected a total of 314,619 project-times, involving 244,128 construction unit-times and 275,049 construction enterprise-times.

(1) Investigation of illegal and non-compliant acts

Housing and urban-rural development authorities across the country identified a total of 8,173 instances of illegal and non-compliant acts in construction projects. Among them, 583 instances were illegal contracting, accounting for 7.1%; 464 instances were subcontracting, accounting for 5.7%; 830 instances were unlawful subcontracting, accounting for 10.2%; 170 instances were affiliation of qualifications, accounting for 2.1%; and 6,126 instances were other illegal and non-compliant acts such as commencing construction before obtaining a construction permit, accounting for 74.9%.

Housing and urban-rural development authorities across the country investigated and handled a total of 2,585 construction unit-times and 5,994 construction enterprise-times involved in illegal and non-compliant acts. Among them, 572 construction unit-times were involved in illegal contracting and 2,013 construction unit-times were involved in other illegal acts such as commencing construction before obtaining a construction permit; 492 construction enterprise-times were involved in subcontracting, 848 construction enterprise-times in unlawful subcontracting, 133 construction enterprise-times in affiliation, 112 construction enterprise-times in lending qualifications, and 4,409 construction enterprise-times in other illegal and non-compliant acts.

(2) Handling of illegal and non-compliant acts.

Housing and urban-rural development authorities across the country imposed administrative penalties or administrative management measures such as suspension of business for rectification, revocation of qualifications and restriction of bidding eligibility on enterprises and personnel involved in illegal and non-compliant acts. Among them, 201 enterprises were ordered to suspend business for rectification, 7 enterprises had their qualifications revoked, 108 enterprises had their bidding eligibility restricted, and 1,930 enterprises were given treatment such as circulated criticism and credit punishment; 21 persons were ordered to stop practicing, and 1,670 persons were given treatment such as circulated criticism; the total amount of illegal gains confiscated was 11.616 million yuan (including 205,200 yuan of illegal gains by individuals), and the total amount of fines was 611.4189 million yuan (including 38.0408 million yuan of fines on individuals).

(3) Progress of investigation and handling in various regions.

In terms of the total number of illegal and non-compliant projects investigated and handled, five provinces (municipalities) — Sichuan, Jiangsu, Hubei, Jiangxi and Chongqing — investigated and handled a relatively large number of projects, with 809, 802, 716, 656 and 591 instances respectively (see Figure 1 for details).

In terms of the four categories of illegal and non-compliant acts investigated and handled, namely illegal contracting, subcontracting, unlawful subcontracting and affiliation, five provinces — Hubei, Hebei, Sichuan, Jiangsu and Jiangxi — investigated and handled a relatively large number of projects, with 305, 229, 162, 141 and 137 instances respectively (see Figure 2 for details).

In terms of the amount of fines, five provinces — Hainan, Hubei, Jiangxi, Henan and Liaoning — imposed relatively large fines, with 127.1023 million yuan, 61.16 million yuan, 60.8987 million yuan, 38.5265 million yuan and 34.0586 million yuan respectively (see Figure 3 for details).

II. Work requirements for the next step

Housing and urban-rural development authorities at all levels shall further raise their awareness, earnestly implement the various work requirements of the Ministry's three-year action for tackling the root causes of work safety in housing and municipal engineering in accordance with the unified arrangements of the Ministry, strengthen the linkage between the market and the site, and intensify routine supervision and inspection. Focusing on projects under construction such as government state-owned investment projects and affordable housing projects, as well as enterprises that have had quality and safety liability accidents or have defaulted on migrant workers' wages in recent years, they shall carry out special inspections of the construction market and seriously investigate and handle illegal and non-compliant acts such as illegal contracting, subcontracting, unlawful subcontracting, affiliation, construction without approval, bid rigging, undertaking projects beyond qualification levels, arbitrarily compressing reasonable construction periods, and defaulting on migrant workers' wages. They shall adhere to "strict supervision and heavy penalties", severely punish in accordance with the law a number of enterprises and individuals involved in illegal and non-compliant acts, summarize typical cases, and comprehensively use means such as public exposure, warning interviews, situation notifications, economic penalties, restriction of bidding, and revocation of qualifications and eligibility to maintain a high-pressure stance against illegal and non-compliant acts in the construction market, form a strong deterrent, and achieve the comprehensive effect of investigating and handling a batch, warning a wide area, and governing a region.

Provincial housing and urban-rural development authorities shall strengthen supervision and guidance over the work of municipal and county-level housing and urban-rural development authorities, carry out business training in laws and regulations and law enforcement inspections at appropriate times, and further improve the law enforcement level of frontline personnel. They shall consolidate work responsibilities, designate supervision responsible persons, regularly notify the progress of construction market supervision work in all cities and counties within their administrative regions, and provide key assistance to areas with insufficient supervision capacity and prominent market problems, striving to promote the resolution of a number of major, long-pending and accumulated cases.

Provincial housing and urban-rural development authorities shall strengthen the verification and checking of data and promptly report the statistical data within their administrative regions to the Department of Construction Market Supervision of the Ministry within 10 days after the end of each quarter. They shall earnestly carry out the investigation and handling of complaint cases referred by the Ministry, seriously handle the verified illegal and non-compliant acts in accordance with laws and regulations, further improve the quality and timeliness of case investigations, and feed back the handling results to the Ministry on time.

Annex:Summary Table of the Investigation and Handling of Illegal and Non-compliant Acts Such as Illegal Subcontracting and Unlawful Subcontracting in Construction Projects in Various Regions in 2023

(This document is voluntarily made public)