Amendments and new regulations coming for private enterprises

( Updated : 2018-11-27

Amendments and new policies to protect private enterprises should be an important part of legislation, according to a recent seminar held by the Ministry of Justice (MOJ).

A sound and fair legal environment is a key to the prosperous and sustainable development of private enterprises, Gan Zangchun, member of the MOJ Leading Party Members' Group, said at the meeting.

According to Gan, the MOJ recently issued 20 opinions on creating a sound legal environment for private enterprises by the end of this year, including deleting or amending items contrary to the equal protection principle and harmful to private enterprises.

Gan pointed that the task is urgent and asks all related departments to shoulder their own responsibilities. He also suggested local governments check regulations and documents and make proper amendments to support private economy.

Some ministries including the State Administration of Taxation, the State Administration of Market Regulation and the China Banking Regulatory Commission have started the work.

According to officials at the three departments, documents on taxation, intellectual property protection and non-public economy development are now under inspections.

Zhang Jinsong, deputy director of the China Banking Regulatory Commission, said regulations related to market entities’ economic activities such as market access, spot inspection, off-site surveillance, administrative punishment, investment promotion, government procurement, industrial development and tendering and bidding are under review.

Zang Aicun, deputy director of the Second Legislative Council of the MOJ, suggested that in addition to the amendments of the previous regulations, new legislation promoting private economy should be a priority in 2019.

He said legislation in several fields, like public-private partnership (PPP) in basic infrastructure construction and public service, enterprises’ income tax, private investment funds, business name registration and individual businesses, should be improved to protect private enterprises’ rights and interests.

Making the administrative procedures simpler and easier was also mentioned at the seminar. Gan said some new acts will start piloting next year.

The Ministry of Finance has cut down 80 percent of approval items and canceled all the intermediary services required for approval.

A total of 20 regulations to streamline the tax filings and shorten the time for formalities will be in effective by the end of this year, according to the State Administration of Taxation.

Small and medium sized private enterprises account a relatively high proportion of lawsuits, according to Gan. He said there is a need to raise legal awareness among these companies.

Shu Guohua, deputy director of the MOJ's public legal service department suggested launching legal assistant stations to offer services such as notarization, arbitration and judicial expertise to private enterprises.

To date, some achievements were achieved by the ministries in supporting private enterprises.

The Ministry of Finance predicts that reductions of more than 130 billion yuan ($18.73 billion) in tax will be achieved in 2018.

According to Wang Jun, head of the State Administration of Taxation, the first three quarters showed that small and micro businesses, large-scale private enterprises and innovative enterprises are the main beneficiaries of the tax cut policy, with tax reductions of 143.7 billion yuan, 71.4 billion yuan and 401.6 billion yuan respectively.