Public solicitation of opinions on the draft of the Private Economy Promotion Law
2024-10-11
The highly anticipated Private Economy Promotion Law has made new progress. On October 10th, the Ministry of Justice and the National Development and Reform Commission released the draft of the "Law of the People's Republic of China on the Promotion of the Private Economy (Draft for Comments)" on their portal website, soliciting public opinions. As the first fundamental law in China specifically related to the development of the private economy, the draft clarifies the overall requirements for promoting the development of the private economy, and makes provisions from the aspects of fair competition, investment and financing, technological innovation, standardized operation, service guarantee, rights protection, and legal responsibility. It better plays the role of the rule of law in consolidating the foundation, stabilizing expectations, and benefiting the long term, stabilizing market expectations, boosting development confidence, and creating a legal environment and social atmosphere conducive to the common development of various forms of ownership, including the private economy. The formulation of the Private Economy Promotion Law is an important deployment made at the Third Plenary Session of the 20th Central Committee of the Communist Party of China. The draft released this time implements the guidelines and policies of the Party Central Committee and the State Council on developing the private economy, and clearly adheres to the "two unwavering" principles. Promoting the sustained, healthy, and high-quality development of the private economy is a major policy that the country has long adhered to It is clear in the draft that the private economy is an important part of the socialist market economy, a fresh force to promote Chinese path to modernization, an important foundation for high-quality development, and an important force to promote China's all-round building into a strong socialist modernization country and realize the great rejuvenation of the Chinese nation. The public solicitation of opinions on the draft is a concrete manifestation of scientific legislation, democratic legislation, and legislation in accordance with the law. It is another major practice of open door legislation, which can better respond to concerns, consolidate consensus, and play an important role in improving the quality of legislation for promoting the private economy and promoting the sustained, healthy, and high-quality development of the private economy. Experts say that various sectors of society generally hope to solve the problems faced by the development of the private economy through legislation. The formulation of the Private Economy Promotion Law is an important measure to implement the decision-making and deployment of the Party Central Committee and the State Council to promote the development of the private economy, and is an inevitable requirement for promoting high-quality development of the private economy through the rule of law. It is widely believed that from the draft, it can be seen that adhering to the "two unwaveringly" and promoting the sustained, healthy, and high-quality development of the private economy is a major policy that the Party and the state have consistently adhered to and will continue to adhere to for the long term. This will give private enterprises and entrepreneurs a "reassurance pill" and stimulate the endogenous power and innovation vitality of the private economy. The draft highlights the principle of equal treatment in Chapter 2 "Fair Competition" and Chapter 3 "Investment and Financing Promotion", effectively ensuring that private economic organizations enjoy equal legal status, market opportunities, and development rights with other types of economic organizations. According to the draft, the country will implement a nationwide unified negative list system for market access. In this regard, Wang Yi, vice president of Renmin University of China, said that the draft stipulates that all kinds of economic organizations, including private economic organizations, can enter the areas beyond the negative list of market access equally according to law; Special regulations have been made for implementing the fair competition review system, regularly clearing market access barriers, and prohibiting restrictions or exclusion of private economic organizations in bidding and government procurement. In addition, Qi Xiangdong, Vice Chairman of the All China Federation of Industry and Commerce and Chairman of Qianxin Group, stated that the draft focuses on the core concerns of private enterprises, such as fair participation in market competition and equal use of production factors. It reflects the thoughts and expectations of private enterprises, clarifies the responsibilities of various departments and localities, and is a pragmatic and effective law. Supporting participation in major national projects in optimizing the investment and financing environment for the private economy, the draft focuses on providing provisions for supporting private economic organizations to participate in major national strategies and projects, and improving the market-oriented risk sharing mechanism for private economic organization financing. The draft proposes to support private economic organizations to invest and start businesses in strategic emerging industries, future industries, and other fields, encourage the transformation and upgrading of traditional industries, and participate in modern infrastructure investment and construction. Experts believe that the formulation of the Private Economy Promotion Law will effectively resolve the problems faced by the development of the private economy in terms of market access, fair competition, investment and financing support, and better ensure that all forms of ownership of the economy use production factors equally in accordance with the law, participate in market competition fairly, and receive equal legal protection. Teng Tai, the president of Wanbo New Economy Research Institute, also stated that the draft has made detailed provisions in various aspects such as promoting investment and financing, supporting technological innovation, and strengthening the protection of entrepreneurs' rights and interests, which will effectively resolve various difficulties that hinder the development of the private economy. According to data from the National Development and Reform Commission, private enterprises have continuously improved their innovation level in recent years, supporting them to take the lead in undertaking major technological research and development tasks. As of the end of 2023, national high-tech enterprises and technology-based small and medium-sized enterprises have 2.134 million valid invention patents, accounting for nearly three-quarters of the total number of domestic enterprises. Developing new quality productive forces has great potential for the private economy. The draft encourages and supports private economic organizations to actively play a role in developing new quality productive forces, and to stimulate new industries, models, and driving forces through technological innovation. It is explicitly stated that private economic organizations should be supported to participate in national scientific and technological research projects, capable private economic organizations should be supported to take the lead in undertaking major technological research tasks, and national major scientific research infrastructure should be opened up to private economic organizations. Wang Yi said that in terms of supporting technological innovation, the draft uses a lot of language and comes up with many practical measures. Supporting private economic organizations to participate in national scientific and technological research projects; Support capable private economic organizations to take the lead in undertaking major technological research and development tasks; Open up major national scientific research infrastructure to private economic organizations; Encourage public research and development platforms and common technology platforms to provide equal services for technological innovation of private economic organizations, and promote the deep integration of industry, academia, and research. Experts say that supporting private enterprises to participate in national scientific and technological research projects can not only promote their high-quality development, but also effectively stimulate economic vitality and provide important support for accelerating the formation of new quality productive forces. Strengthening the protection of the rights and interests of private entrepreneurs and enhancing the legal guarantee for the development of the private economy must effectively prevent improper filing, selective law enforcement, profit seeking law enforcement or local judicial protection, and avoid exceeding authority, scope, amount, time limit, sealing, seizing, freezing property, etc. In this regard, the draft clearly states that the implementation of compulsory measures such as restricting personal freedom and sealing, seizing, freezing involved property should be strictly carried out in accordance with legal authority, conditions, and procedures. It is prohibited to illegally intervene in economic disputes through administrative or criminal means. Refine case handling procedures and standardize law enforcement behavior in different locations. Lv Hongbing, a member of the National Committee of the Chinese People's Political Consultative Conference and the Chairman of the Supervisory Committee of the All China Lawyers Association, stated in a proposal submitted during this year's National People's Congress and Chinese People's Political Consultative Conference that it is crucial for government departments to act in accordance with the law, and the core is for judicial organs to effectively protect the personal rights of corporate families. At the same time, in response to the issue of unreasonable conditions for large enterprises to pay accounts to small and medium-sized private economic organizations, which is of great concern to private enterprises, the draft specifically includes provisions to address this social difficulty. Wang Yi emphasized that large enterprises should reasonably agree on payment terms and pay accounts in a timely manner when purchasing goods, projects, services, etc. from small and medium-sized private economic organizations, and should not use receiving third-party payments as a condition for paying accounts to small and medium-sized private economic organizations. This provides a clear legal basis for effectively resolving the issue of "back-to-back" clauses through judicial means in the future. Strengthening the protection of rights and optimizing service guarantees. In terms of service guarantees, the draft clearly states the establishment of a smooth and effective communication mechanism between government and enterprises, the formulation of laws, regulations, rules, and other normative documents, judicial interpretations closely related to the production and operation activities of business entities, or the making of major decisions. Attention should be paid to listening to the opinions and suggestions of various economic organizations, industry associations, and chambers of commerce, including private economic organizations. At the same time, the draft provides for strengthening administrative law enforcement supervision and preventing multiple law enforcement agencies. Establish a sound system for punishing dishonesty and repairing credit. For those who meet the conditions for credit repair, it is required to promptly lift the punishment measures and achieve collaborative repair on relevant public credit information platforms. In addition, the draft clearly states that the production and operation activities of private economic organizations shall comply with laws and regulations, and shall not obstruct market and financial order, use bribery and fraud to profit, damage the ecological environment, harm the legitimate rights and interests of workers, and the public interest; And put forward requirements for improving the rules and regulations of capital behavior system, guiding private economic organizations to strengthen integrity risk prevention and control, and encouraging qualified private economic organizations to establish and improve the modern enterprise system with Chinese characteristics. According to Ju Jinwen, a researcher at the Institute of Economics of the Chinese Academy of Social Sciences, the formulation of the Private Economy Promotion Law is a major institutional arrangement based on the fundamental system and basic economic system of socialism with Chinese characteristics. Experts pointed out that the draft not only encourages and supports the development and growth of the private economy, but also emphasizes strengthening regulatory guidance, reflecting the completeness of the legislative content. (New Society)
Edit：Yao Jue Responsible editor：Xie Tunan
Source：Beijing Business Today
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