Situation on Yang Bin’s Case

――Main viewpoints from defending lawyer
Yang Bin, with a Chinese origin and nationality of the Kingdom of the Netherlands, was under house arrest on October 4, 2002 in Shenyang and was arrested on November 27 of the same year. The case was heard in an open trial in Shenyang City Intermediate People’s Court from June 11 to 13 of 2003. The court made a final decision of judging guilty on the six indicted counts and the punishment of several counts altogether to implement a fix-term imprisonment for 18 years. On September 6 of that year, Liaoning Provincial Supreme People’s Court maintained the judgment made by the first-trial court. Yang Bin is now serving his sentence.
As the defender of Yang Bin, I think there are some problems in handling the case; based on the relevant facts and laws, now I present the main points of my defending views as follows (the views are for the part of free sentence):
I. The accusation of the “fictitious investment” was judged for the offense of “fake registered capital” after the trial. This offense was sentenced for 2-year imprisonment. Against this accusation, the defending lawyer put forward the basic facts with evidence to prove that: (1) from July 2001 to September 2002, there was investment funds in total of RMB 700 million injected into the “Holland Village” project. This basic fact could already objectively negate the deliberate subjective accusation of “fictitious investment”, or the accusation of “fake registered capital” was in fact a simply deliberate, subjective accusation against Yang Bin, because the real injection of capital of RMB 700 million was far more than the accused “fake capital” of RMB 200 million. (2) There is evidence to prove that the shell companies set up by Yang Bin were there to meet the requests of some local officials to complete their duty on the “introduction of investments”. This can also negate Yang Bin’s subjective purpose to commit this crime. Thus the accusation of this crime is totally groundless according to the law.
II. The accusation of the “contractual fraud” of Yang Bin was sentenced for 10- year imprisonment. The “contractual fraud” crime ascertained in the judgment can be objectively divided into two periods: Firstly, the period when Yang Bin continued to develop and purchase land; secondly, the period when the land earlier purchased by Yang Bin was then purchased by Land Consolidation Center of the Land and Resources Office of Liaoning. The objective analysis on these two periods can serve to deny the views of indictment by the prosecutor and the recognition of the judgment.
1. There were evidences to prove that the aim for Euro-Asia Industrial Company to purchase the “land” (the fictitious land) was to continue the development. As Yang Bin and his staff in Euro-Asia Industrial Company were not familiar with the land policy of our country, they consulted with Li Ye, the former Deputy Director of the Land and Resources Office of Liaoning, and with Zhang Jiaxu, an official in the Land and Resources Office of Liaoning. From these two officials, they understood that in order to acquire land, the same quantity of new land must be created to maintain the “balance”. New land creation could also be achieved by making purchase of the new land created from somebody else. Therefore Euro-Asia Industrial Company entrusted Zhang Jiaxu with this matter specifically.
The evidences of dossier indicated that: (1) The created land purchased by Euro-Asia Industrial Company in Weizigou village, Woniushi town, Faku county of Liaoning province for more than 264 acres, was objective and real. This land was not included in the Cadastral Management System; (2) In the course of purchase, two sides went through negotiation process. There was nothing cheating involved; (3) Euro-Asia Industrial Company paid RMB 1.2 million Yuan for the purchase and received an invoice of land purchase in the amount of only RMB 980,000 Yuan.
The above evidences proved that Euro-Asia Industrial Company purchased the created land which was not included in the Cadastral Management System. This purchase was made subjectively to meet the requirements of national land policy on the “balance”. Objectively there was a negotiation process between two parties and nobody was to be cheated.
2. There was evidence to prove that Euro-Asia Industrial Company later sold this land to the Land Consolidation Center of the Land and Resources Office of Liaoning, because Euro-Asia was forced to do so. As the land policy changed, the land not purchased into the land reserves could not be used as a pledge to replace. The Land Consolidation Center paid RMB 3.166 million Yuan to Euro-Asia Industrial Company to buy this land. Although the difference between the acquisition price and the original purchase price created a profit, that was quite normal in business transactions. There was no cheating, let alone fraud.
Based on the relevant facts supported by the above evidences, the charge of “contractual fraud” could not be established in accordance with the law.
III. The judgment ascertains that “the defendant Yang Bin committed the crime of bribing government unit. On this crime, he was sentenced for 1-year imprisonment. He also committed the crime of bribing staff in government unit. On this crime, he was sentenced for 1-year imprisonment”. The facts related with the above two charges basically arose from the process of so-called “contractual fraud”.
1. The judgment ascertained that during the purchase of the land in Weizigou village, Woniushi town, Faku county of Liaoning province, RMB 980,000 Yuan paid by Euro-Asia Industrial Company was actually the bribery to some government unit. This judgment was obviously wrong, because (1) Euro-Asia Industrial Company was not familiar with the national land policy, so it consulted with the cadre of Land and Resources Office and entrusted him with the task specifically of handling the purchase of the land involved. Now the prosecutor asked that Euro-Asia Industrial Company, in particular Yang Bin to bear the criminal charge for this transaction. That was not objective and rather unfair; (2) There is evidence to prove that the purpose for Euro-Asia Industrial Company to purchase the land involved was meant to meet the national land policy, so that it could get the pledge and replace the land expropriated for development and construction. Its interest was not in seeking illegal profits; (3) After Euro-Asia Industrial Company paid RMB 980,000 Yuan, it got around 264 acres of land, and also received the matching invoice for land purchase. Therefore it did not meet the alleged charge of bribing government unit.
2. On the crime of bribing staff in government unit, the judgment ascertained two parts: First, RMB 250,000 Yuan of about RMB 1.2 million Yuan paid for the purchase of the land involved that Euro-Asia Industrial Company made went to Zhang Jiaxu. So the judgment regarded this RMB 250,000 Yuan as “bribing to staff in government unit”. As the nature of this RMB 250,000 Yuan, Zhang Jiaxu said, “that was my compensation for helping them handle the land.” but Yang Bin argued that “the testimony of Zhang Jiaxu does not match with the fact. When Euro-Asia Industrial Company paid this money, Zhang Jiaxu told us that it was for the construction proceeds for creating the land. He didn’t mention that it was in fact his compensation. And if it was indeed for his compensation, how was it impossible to bribe somebody by writing a check?” We believe that the judgment was defective, because from the available evidence we couldn’t even prove that this money was given by Euro-Asia Industrial Company voluntarily as the bribery proceeds for Zhang Jiaxu. We also couldn’t rule out the possibility that Zhang Jiaxu, in fact, stole that money during his task of handling the land purchase for Euro-Asia Industrial Company.
The second part of bribing to staff in government unit was that in December 2000, Yang Bin gave US$20,000 Li Ye, the former Deputy Director of Land and Resources Office of Liaoning. There was not sufficient fact discovery on this charge on the court. It was inappropriate to sentence the defendant guilty on this charge without sufficient evidence. According to the testimony of Li Ye, “To help Euro-Asia Industrial Company get the loan, I made an authorized amendment on the No.598 Document of Liaoning Government Land of Liaoning Provincial People’s Government. Yang Bin bribed me with US$20,000 but I returned the money to him.” However, Yang Bin pleaded that, “The US$20,000 for Li Ye wass true, but I did not ask Li Ye and Zhang Jiaxu to amend No.598 Document. The US$20,000 for Li Ye was actually the wages paid to his son who worked in the school that I set up abroad. It was not for bribery.”
IV. The judgment ascertained that the defendant Yang Bin committed the crime of forging financial bills and notes. On this crime, he was sentenced for 10-year imprisonment. Regarding this charge, after the court hearing, the fact was revealed more clearly. The defending lawyer only put forward two points on the term of the sentence:
1. on the qualitative issue: Euro-Asia Agricultural Company really forged checks, account receivables, and some bank settlement documents. But the fact without disputes was that all of these documents were used to inflate the sales performance of the listing vehicle of Euro-Asia Agricultural Company in Hong Kong. None of these documents flew into financial or banking system, which means that these documents were made to inflate the sales performance of the listed company. This behavior violated the provisions of Article 161 of China’s Criminal Law, constituting “the crime of providing false accounting reports”. According to the principle of integrating the subjective and objective factors, this offense should not be classified as “crime of forging financial bills and notes”.
2, on the accountability issue: After Euro-Asia Industrial Company ran into problems, its CFO Yan Chuang escaped abroad and was never brought to justice. Objectively and realistically speaking, as the company’s CFO, Yan Chuang should bear the main responsibility on this charge. He is the “directly responsible supervisor” in this case, as stipulated in China’s Criminal Law.
V. Evaluation on Yang Bin
As the defending lawyer who undertook this case, I came to know that through a large amount of capital investment and the painstaking efforts of Yang Bin, Shenyang “Holland Village” was established rapidly, which result was obvious to all. This project has contributed significantly to the improvement of the appearance of Shenyang City and led to the development of related industries. The important role that his investment has made should be affirmed. We cannot deny that Yang Bin’s investments carried some degree of arbitrariness. He made mistakes here and there. Especially he was not totally ignorant about the forging of the sales numbers by his CFO Yan Chuang. Therefore he should undertake his corresponding duties. But the charges against him should be assessed fairly and objectively from a clear understanding of the background details involved. These charges should not be subject to other factors. Only based on this principal can the judgment lead to and protect the healthy development of China economy.


Lawyer Cao Shuchang from Beijing King & Capital Lawyers Firm
On Nov. 20, 2007

On September 6 and 7 of 2003, in the court of the second trial, the judges and prosecutors of Liaoning Provincial Supreme People’s Court should answer or dismiss the summary statements made by Yang Bin’s main defending lawyer Tian Wenchang, based on the evidence and the use of law as yardstick. But it was a pity that the judge disregarded the fact that of the four charges, three could not be established and one could not be determined property. The court was adjourned temporarily in haste. After one hour, the judge announced the court in session and that the original conviction was accurate and trial procedures were legal. His ruling was as follows: “the appeal was rejected and the original verdict was upheld. This ruling is the final ruling” So, how about “the fact that three charges can not to be established and one cannot be determined properly” put forward by lawyers Tian Wenchang and Cao Shuchang? Was there any practical and realistic answer to their statement? No, so far there was no answer at all. Was this sentence a fair one? People can judge by themselves. But this sentence decided the fate of Yang Bin, the chief executive of Sinuiju SAR of North Korea. It made the Sinuiju SAR leader-less and run aground, thus affecting the relations between China and North Korea. Is this for the dignity of law in China? I am afraid that this is not a reasonable interpretation. Explanations can be various, just like the endings to a story could have a variety. So readers can apply their own imagination fully.