23 May 2011

Liu Xiaoyuan on the Investigation of Alleged "Tax Evasion" by Ai Weiwei

I worry about Liu Xiaoyuan.

At a time when so many other outspoken lawyers in China have been silenced, he is one of a handful who continue to speak out publicly about sensitive cases. When, as frequently happens, one of his blog posts is taken down by censors at Sina, he posts the notification he receives. (Sometimes, even those messages get censored.)

Liu is also one of the few Chinese rights lawyers still actively posting to Twitter. That might be because, for over a month, he's been on a kind of "probation" over at Sina Weibo, where every post needs to be examined first before it can be put online.

Lately, Liu has been especially vocal about the case of his friend, the artist Ai Weiwei, who disappeared into police custody on 3 April. Late last week, in a terse notice, the Xinhua News Service issued the first confirmation that Ai had been placed under "residential surveillance" (jianshi juzhu) while police investigated alleged tax evasion by his company, Beijing Fake Cultural Development.

Procedurally speaking, the way the police have used residential surveillance in this case is extremely questionable and reminiscent of the way that Liu Xiaobo's case was handled two years ago. In a series of posts on Twitter earlier this morning (translated roughly below), Liu Xiaoyuan also raises some interesting questions about the way the investigation of tax evasion charges has been handled.

I don't know whether Liu is right about the way that tax evasion cases are normally handled in China, but his analysis certainly rings true to me.

1. After Ai Weiwei was taken away from the airport, the police went to his workshop to conduct a search and took away other employees for investigation. At the time I believed that they weren't pursuing economic charges. Why did I think that? Because they only seized the office computer and the video discs of some social actions, not the company accounts. Only after the case had attracted international attention did they shift their focus to economic problems. So, they then carried out a second search to seize the account books.

2. Before Ai Weiwei was taken into custody, the tax authorities never investigated any tax issue at the "Fake" Company. In other words, if the tax authority never uncovered any issue regarding tax payment at the "Fake" Company, how did the public security organ come to their discovery, then?

3. Determination of whether or not a company has been evading tax should result from of an investigation by the tax authorities. If they discover tax evasion, the tax authorities issue an [administrative] penalty. If the company doesn't pay the missing tax or disregards the penalty, and if the amount in question meets the standard for launching a criminal investigation, the tax authority will hand the tax-evasion case over to the police for investigation and the law-enforcement authorities will pursue criminal responsibility in accordance with the law.

4. In Ai Weiwei's case, the police detained him before the tax authorities had issued a ruling about any investigation. So, at the beginning they were not pursuing any economic issues. Think about it: if Ai Weiwei hadn't been paying attention to social problems and didn't conduct himself in an "unconventional" manner, would anyone really be looking into any "economic issues"?

5. People have said to me that those in art business all have economic problems. I'm not too familiar with the art circles, so I don't dare comment on this. But I think that if this is such a common problem, why don't we see more artists being investigated for economic problems? It seems that more often than not, artists get investigated for their "unconventional" behavior.
UPDATE (25 May 2011): As a commenter notes below, Liu Xiaoyuan was apparently pressured to remove 16 of his Tweets related to Ai Weiwei. You can find the ones I translated among the others here: http://loveaiww.blogspot.com/2011/05/liuxiaoyuan-52416.html?spref=tw.

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