A new law enacted by China's legislature aims to remove much of
the red tape associated with running a business, and remove
numerous opportunities for corrupt officials to make money from
issuing licenses and franchise rights.
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The Standing Committee of the National People's Congress (NPC)
adopted a law on administrative licenses here Wednesday, which
embodies the principle of rigorously restricting the power of
government bodies and will facilitate the country's uphill battle
against corruption.
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The law of 83 articles in eight chapters, with a decree by
President Hu Jintao, will take effect as of July 1, 2004.
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The new law covering the government's right to grant franchises,
permits or certificates to businesses and individuals "will have an
unprecedented impact on the relations between government bodies and
common citizens," Prof. Ying Songnian said in an interview with
Xinhua.
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Prof. Ying, a member of the NPC Civil Affairs Committee and dean of
the department of law of the State Administrative College, helped
write the draft's first version.
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The State Council, or the Chinese cabinet, has found that its
commissions and ministries used to empower themselves with a total
of 3,000 rights in granting franchises or permits.
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"On the one hand, the government bodies were managing many things
that they couldn't manage or should manage," Prof. Ying said.
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He noted that government officials had found the right to granting
franchises and permits very profitable for their departments, and
themselves.
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"Government bodies are enthusiastic about expanding their power
because they can collect fees from those who want the franchises or
permits, and this is a major source of government corruption," Ying
said.
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It was not strange to see a prospective entrepreneur become
discouraged by too many visits to government departments just for
permission to open a small restaurant.
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Prof. Ying went on to say that the State Council launched its
massive reform measures in 2001 after it discovered a large number
of problems in a survey for the legislation. So far, commissions
and ministries of the State Council have given up rights to
administer 1,195 franchise rights, and handed 82 items to
industrial associations and other intermediate agencies.
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However, the legislation adopted Wednesday will ensure that such
administrative reform continues in the right direction, lawmakers
and legal experts said.
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Under the new law, commissions and ministries of the State Council
will no longer have the right to empower themselves with
franchising rights, and fee collection practices will be
abandoned.
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A vital feature of the new law highlights "higher efficiency and
convenience for ordinary common people," said Wang Yongqing, deputy
director of the Legislative Affairs Office of the State
Council.
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The law simplifies the procedures for administrative licenses and
abolishes unnecessary restrictions against applicants, and makes
the government administration the last option only after all other
means have failed.
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A government license should only be required by a citizen if his
business is related to national or economic security, public
interest, personal rights and property of other citizens,
exploitation of rare natural resources and the distribution of
limited public resources, according to the law.
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To avoid the misuse of power by government bodies, franchises for
the distribution of limited resources should be granted through
bidding, auction or competition, it notes.
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The law says that the people who want to start a business or other
enterprise will be required to go to far fewer government agencies
for approval. Even if approval from different government bodies is
required to get one thing done, for instance opening a restaurant,
these bodies may also set up a special office dealing with
restaurant certification so applicants do not have to go to
different places.
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"We shouldn't cost people too much effort, time and money, even if
it means more work for the government," said Wang Yongqing, the
official with the Legislative Affairs Office of the State
Council.
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Such stipulations are also in compliance with the rules of the
World Trade Organization and are needed by China in accommodating
itself to an ever more globalized economic structure, he
acknowledged.
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The Chinese leadership has declared that "power should be used for
the people, passion should be tied to the people and interests
should be sought for the people."
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The new legislation can be seen as a new landmark for the Chinese
leadership in enforcing its political manifesto, legal experts
say.
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(Xinhua News Agency August 28, 2003)