Last week, the 13th NPC Standing Committee (NPCSC) released its five-year legislative plan (“13th NPCSC Plan”), setting the contours of its legislative agenda through 2023. As a refresher, the Plan consists of three classes of projects, with 69 top-priority ones in Class I, 47 lower-priority ones in Class II, and a few potential subjects to legislate on in Class III. In this and the next post, we will take a deep dive into the new legislative plan, from both qualitative and quantitative angles. Below, we will compare the 13th NPCSC Plan with its predecessor, distill a few themes from the new plan, and highlight some new projects. The Plan is clear evidence that, unsurprisingly, the NPCSC, though the permanent body of China’s constitutionally “highest organ of State power,” does not have any independent policymaking authority but only serves to implement through legislation the Communist Party’s policy directives.
Translation note: As explained here, we will use “modify” or “modification” (abbreviated as “mod.”) to translate “修改.” If we are (close to) certain of the form a particular modification will take, we will use “amendment” or “revision” as appropriate.
Uncompleted Projects from Last Term
By the time the 13th NPCSC Plan was released on September 7, fifty (of a total of 102) numbered projects in the 12th NPCSC’s five-year legislative plan (“12th NPCSC Plan”) remained uncompleted—either not submitted for deliberation at all or submitted but still pending. As one would expect, most—all but five—of these projects were relisted in the 13th NPCSC Plan. While they mostly retained their original priority level, some have moved between categories, as detailed below.
Seven Class II projects were promoted to Class I: E-Commerce Law [电子商务法], Foreign Investment Law [外国投资法], Community Corrections Law [社区矫正法], and revisions to the Cultural Relics Protection Law [文物保护法], Maritime Traffic Safety Law [海上交通安全法], Officers in Active Service Law [现役军官法], and Drug Administration Law [药品管理法].
Among them, the E-Commerce Law was passed just last month, and all but the last two projects have already been released for public comments. The Foreign Investment Law and Community Corrections Law have also been (tentatively) scheduled for an initial review in October and December, respectively. The progress made in drafting these bills explains their promotion in a categorization system that is largely based on the ripeness of legislative conditions. As for the planned Drug Administration Law revision, the now-abolished China Food and Drug Administration disclosed last November that it had made much headway in drafting the bill, which could have contributed to the prioritization of the project. The same might also be true for the Officers in Active Service Law revision, as pilot programs to revamp the military officer system will soon enter the third year (and wrap up?), paving the way for codification of the reform.
Six topics that were designated for further research by the 12th NPCSC Plan were upgraded to full-fledged (i.e., numbered and titled) projects in the 13th NPCSC Plan. They are the Integrated Military and Civilian Development Law [军民融合发展法], Preschool Education Law [学前教育法], and Social Assistance Law [社会救助法] in Class I; and the Space Law [航天法], Rural Revitalization Promotion Law [乡村振兴促进法], and Civil Compulsory Enforcement Law [民事强制执行法] in Class II. Avid China watchers should have no problem recognizing recent policy buzzwords such as “integrated military and civilian development” and “rural revitalization.” In fact, all six themes appeared at least once in Xi Jinping’s report to the 19th Party Congress—except civil compulsory enforcement, which is closely linked to the much-hyped campaign against “difficulty in enforcing civil judgments” [执行难] currently spearheaded by the Supreme People’s Court.
Four Class I projects were deprioritized. To start, Vocational Education Law (Mod.) [职业教育法], Civil Air Defense Law (Mod.) [人民防空法], and Telecommunications Law [电信法] were downgraded to Class II projects. We won’t speculate as to why but will note that the Telecommunications Law has been in all but one of the NPCSC’s five-year legislative plans—since 1993. It is quite remarkable that twenty-five years later, the law is still nowhere close to being enacted. The fourth project, the proposed Land Borders Law [陆地国界法], was demoted to Class III. We likewise won’t speculate about the reason.
As we have mentioned at the outset, five uncompleted projects in the 12th NPCSC Plan were not relisted in the new plan. A planned revision to the Mine Safety Law [矿山安全法] was dropped even though a former senior official with the (now-defunct) State Administration of Work Safety disclosed in 2015 that it would be revised as the Mine Occupational Safety and Health Law [矿山职业安全健康法]. The Law on Development Plans [发展规划法] was dropped even though it is a task expressly required by the 13th Five-Year Economic and Social Development Plan (English PDF; see Ch. 80, sec. 1). And the Infrastructure and Public Utility Franchises Law [基础设施和公用事业特许经营法] was dropped even though the National Development and Reform Commission has circulated a draft internally around 2015—the draft has since been leaked online. The Criminal Victim Assistance Law [刑事被害人救助法] was also dropped but we have nothing more to say about it.
Lastly, the project to modify the Circular Economy Promotion Law [循环经济促进法] was not relisted, either. But an amendment to it will likely be considered by the NPCSC alongside a revision to the Law on the Prevention and Control of Environmental Pollution by Solid Waste (“Solid Waste Law”) [固体废物污染环境防治法] this December. We hypothesize that government officials more recently determined (contrary to what they first envisioned) that the scope of change to the Circular Economy Promotion Law would not be so extensive as to warrant a place for the project in the new legislative plan.
Main Themes of New Plan
Compared to its predecessor, the 13th NPCSC Plan includes 72 new projects and 15 new topics for potential legislation. Upon a close examination, a few dominant themes emerge from these projects that align with the Party’s priorities and initiatives under Xi.
Anti-corruption. The 13th NPC already passed a constitutional amendment that (among other nontrivial things) created supervision commissions and an implementing Supervision Law [监察法]. The 13th NPCSC Plan includes two projects that would in turn supplement the Supervision Law: a Governmental Sanctions Law [政务处分法] (see Supervision Law art. 11, item 3, which grants supervision commissions the authority to give “governmental sanctions”) and a Supervisors Law [监察官法] (see id. art. 14, which provides that matters such as the “hierarchical setup, appointment and removal, evaluation, and promotion of supervisors” are to be prescribed by law). Both laws were assigned to the State Supervision Commission, signaling that the Legislation Law would soon be amended to grant the Commission power to submit legislative bills. Lastly, per the new legislative plan, an amendment to the Criminal Procedure Law [刑事诉讼法] is currently pending before the NPCSC, authorizing trial in absentia for, among others, people accused of corruption or bribery who had fled overseas.
Environmental protection. This is one of the three “tough battles” [攻坚战] currently fought by the Party. The last NPCSC was quite productive in this area, having revised the Environmental Protection Law [环境保护法], updated laws on air pollution, water pollution, wildlife protection, and marine environmental protection, and also enacted a new environmental protection tax. To continue this trend, the 13th NPCSC (having just adopted the Soil Pollution Prevention and Control Law [土壤污染防治法]) included additional environmental legislation in the legislative plan: revisions to the Solid Waste Law, Law on the Prevention and Control of Environmental Noise Pollution [环境噪声污染防治法], and Environmental Impact Assessment Law [环境影响评价法] as well as new Antarctic Activities and Environmental Protection Law [南极活动与环境保护法], Yangtze River Protection Law [长江保护法], National Parks Law [国家公园法], and Territorial Space Development and Protection Law [国土空间开发保护法]. The 13th NPCSC Plan also designates “wetlands protection, comprehensive use of resources, and spatial planning” as areas for future legislation.
National security. The 12th NPCSC passed a series of restrictive national security legislation, including the infamous Cybersecurity Law [网络安全法] and the Law on the Management of Overseas Nongovernmental Organizations’ Activities Within Mainland China [境外非政府组织境内活动管理法]. The 13th NPCSC is poised to further expand this collection of laws by enacting Export Control Law [出口管制法], Encryption Law [密码法], and Law on Ensuring Food Security [粮食安全保障法]. The proposed Data Security Law [数据安全法] may also belong to this category depending on its eventual scope. Moreover, the relevant entities will conduct research for potential legislation on “land borders, nonproliferation, artificial intelligence, and biosecurity.”
Public institutions reform(?). In China (and some other jurisdictions), “organic laws” [组织法] provide for the structures, functions, procedures, and other basic aspects of public institutions. China has seven such laws (or eight if you count the Supervision Law), governing respectively the NPC, State Council, local governments and legislatures, courts, procuratorates, urban residents’ committees, and villagers’ committees. All seven are listed in the 13th NPCSC Plan for revisions, in accordance with the decisions of the Party’s 2014 Fourth Plenum, 19th Congress, and 2018 Third Plenum to “improve the organic laws of State institutions.” Several of these laws, such as the NPC Organic Law [全国人民代表大会组织法] and the State Council Organic Law [国务院组织法], have never seen any change since their adoption in the 1980s. But we suspect that the revisions would more likely to codify existing practices than to introduce real reforms.
Taxation. The 13th NPCSC added six new tax laws to its legislative agenda—Consumption Tax Law [消费税法], Vehicle Acquisition Tax Law [车辆购置税法], Urban Maintenance and Construction Tax Law [城市维护建设税法], Stamp Tax Law [印花税法], Deed Tax Law [契税法], and an amendment to the Individual Income Tax Law [个人所得税法]—bringing the total to eleven. This focus on tax legislation stems from the Party’s 2013 Third Plenum’s decision to “implement the principle of law-based taxation” [落实税收法定原则]—which requires that the essential elements of a tax be prescribed by statute and not by administrative regulations. As we have explained in detail on our Tax Legislation Tracker page, 12 of China’s 18 taxes are currently governed by the latter type of authorities, which the NPCSC seeks to replace with statutes by 2020. Note that the 13th NPCSC Plan did not include projects relating to the urban land use tax [城镇土地使用税] or the land value-added tax [土地增值税]. We thus predict that they would either be abolished or merged with other taxes like the value-added tax.
Other Notable New Projects
Below we discuss two groups of new projects, besides those already mentioned above, to which foreign businesses and those concerned with China’s legal reform and state of rule of law should respectively pay close attention. Certain projects inherited from the 12th NPCSC Plan also merit attention, so be sure to check out the whole legislative plan.
Projects affecting businesses. Such projects in Class I of the 13th NPCSC Plan include proposed Real Property Registration Law [不动产登记法] (expected to govern the registration of property rights such as building ownerships and construction land use rights) and Personal Information Protection Law [个人信息保护法] (which will in part regulate how businesses collect and use consumers’ personal information). Also listed in Class I are potential changes to the 12-year-old Administrative Penalties Law [行政处罚法] (prescribing rules on administrative penalties including fines and administrative detentions) and the recently amended Workplace Safety Law [安全生产法]. In Class II, seven projects are worth watching: potentially extensive revisions to the Company Law [公司法], Scientific and Technological Progress Law [科学技术进步法] (providing policy support for scientific and technological innovations and research), Product Quality Law [产品质量法], 10-year-old Anti-Monopoly Law [反垄断法], 12-year-old Enterprise Bankruptcy Law [企业破产法], 24-year-old Arbitration Law [仲裁法], and 26-year-old Maritime Law [海商法].
Projects with rule-of-law implications. Class I includes projects to revise the People’s Armed Police Law [人民武装警察法] (which may expand the powers of armed police in addition to placing it under sole military control) and the Public Security Administrative Penalties Law [治安管理处罚法] (a draft of which was released in early 2017, adding new offenses and imposing heavier penalties for most offenses). Also included is a new amendment to the Criminal Law, which will most certainly add new crimes and reduce the number of crimes eligible for the death penalty. It is very likely that three four projects will be completed by the end of the 13th NPCSC’s term. Lower-priority projects include revisions to the People’s Police Law [人民警察法] and the Lawyers Law [律师法] as well as a new Legal Aid Law [法律援助法]. The first two should be causes for concern as a draft revision to the People’s Police Law further expanded the police’s broad powers and changes to the Lawyers Law may further restrict lawyers’ ability to advocate on behalf of clients, especially in (politically sensitive) criminal cases, given recent crackdowns. Lastly, of particular interest to us is the project to modify the Law on the Oversight by the Standing Committees of People’s Congresses at All Levels [各级人民代表大会常务委员会监督法]. We are eager to see whether this project will strengthen and expand legislatures’ oversight authority or will simply incorporate more recent practices.
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The second part of our analysis will be forthcoming. Stay tuned.
UPDATE (Sept. 16, 2020): The second part of our analysis is available here.
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Comments & Pingbacks
“potentially extensive revisions to the Company Law [公司法]…”
Is this the same amendment of the Conpany Law that is currently available for public comment? If so, I would not call it extensive, as the sole purpose of the amendment is to allow companies to execute stock buybacks in a wider variety of circumstances.
No it certainly is not. The project in the plan is assigned to the Council of Chairmen while the amendment currently open for public comments was drafted by the CSRC.