Last Friday, December 24, the 13th NPC Standing Committee (NPCSC) concluded its 32nd session and adopted eight bills. To give the new Anti–Organized Crime Law [反有组织犯罪法] the attention it deserves and to limit the length of this post, we will publish a separate summary of that Law, likely in January. The other seven bills are discussed below.
Seed Law Amendment
The new amendment to the Seed Law [种子法] focuses on strengthening protections for new plant varieties and brings China’s regime more in line with that of the 1991 Act of the International Convention for the Protection of New Varieties of Plants (UPOV ’91). (China has acceded to only the 1978 Act of the Convention).
In this respect, the amendment makes three key changes. First, consistent with UPOV ’91, it expands the scope of protection to include the “harvested material” [收获材料] of a protected plant variety, in addition to its “propagating material” [繁殖材料] (art. 28, para. 3 as amended). The amendment also grants protections for a protected variety in additional stages of commercialization: from production, propagation, and sale, to production, propagation, offering for sale, sale, export, import, and storage for any of the aforementioned purposes (id. para. 2).
Second, the amendment introduces the concept of “essentially derived varieties” (EDVs) [实质性派生品种] under UPOV ’91. It defines the term essentially the same as UPOV ’91: an EDV is one that is “predominantly derived from the initial variety, or from a variety that is itself predominantly derived from the initial variety”; is “clearly distinguishable from the initial variety”; and “except for the differences resulting from the act of derivation, conforms to the initial variety in the expression of the essential characteristics that result from the genotype or combination of genotypes of the initial variety” (art. 90, item 10). An EDV regime would expand the scope of the so-called breeder’s right because commercialization of an EDV requires authorization of the rightsholder of the initial variety (art. 28, para. 4). The amendment authorizes the State Council to prescribe the steps and measures for implementing the EDV regime (id. para. 5); according to a legislative report, the State Council will do so when it amends the Regulations on the Protection of New Plant Varieties [植物新品种保护条例].
Third, the amendment increases the damages for infringement of the breeder’s right. Willful infringement with “serious circumstances” may lead to up to quintuple punitive damages (art. 72, para. 3). The amendment, moreover, raises the maximum statutory damages to RMB 5 million, from 3 million (id. para. 4).
The amendment will take effect on March 1, 2022.
Civil Procedure Law Amendment
The amendment to the Civil Procedure Law [民事诉讼法] codifies the pilot civil procedure reforms that have been carried out in dozens of courts across China since early 2020. The overall goal of those reforms is to resolve simpler, less controversial civil disputes using fewer judicial resources. The amendment thus makes the following main changes.
First, it authorizes civil litigation to be conducted online for any party that consents, and puts online litigation activities on the same legal footing as offline litigation activities (art. 16 as amended). (Any party that does not consent will participate in the proceedings offline.) In addition, with the addressee’s consent, all litigation documents may now be served online, but the addressee retains the right to request a hard copy of court rulings (art. 90, para. 1).
Second, the amendment expands the category of cases that may be heard by a single judge. In a basic-level court, first-instance civil lawsuits may now be heard by a single judge using ordinary (the most complex) procedures, if “the basic facts are clear and the rights and obligations are definite” (art. 40, para. 2). In addition, in an intermediate court, a single judge may hear appeals from (1) cases that were heard using summary procedures or (2) lower courts’ procedural rulings (called “judgments” [裁定]), if “the facts are clear and the rights and obligations are definite” and if both parties consent (art. 41, para. 2). Because a single judge is thought to be more error-prone than a panel of judges, the amendment lists six types of cases that cannot be heard by a single judge, including cases involving mass disputes that could affect social stability, and cases that are novel, complex, or difficult (art. 42).
Third, the amendment lowers the threshold for applying the simpler small-claims procedures. Previously, such procedures applied when the amount in controversy was less than 30% of the previous year’s average salary of the employees of a certain province. The amendment raises that ceiling to 50%, so that the expedited process would apply in more cases (art. 165, para. 1). With both parties’ consent, small-claims procedures may also be used when the amount in controversy is between 50% and 200% of the previous year’s provincial average salary (id. para. 2).
Finally, the amendment expands the use of the process for judicial confirmation of mediation agreements. Once a mediation agreement reached by the parties is confirmed by a court, it will be directly enforceable when a party alleges breach, without the need to bring a separate breach-of-contract suit. Previously, this process applied only to the agreements reached through mediations by the people’s mediation committees. Under the amendment, it now applies to mediation agreements reached through the mediation by any “mediation organization established according to law” (art. 201).
The amendment will take effect on January 1, 2022.
The NPCSC approved two pieces of environmental legislation last Friday.
1. The Wetlands Protection Law [湿地保护法] is the first national law dedicated to conserving wetlands: important ecosystems that serve a diverse range of functions, including water purification, flood control, biodiversity preservation, climate regulation, and carbon fixation. The Law also serves to fulfill China’s obligations under the Ramsar Convention on Wetlands; China will host the 14th meeting of the Conference of Parties to the Convention in 2022.
The Law’s definition of “wetlands” largely tracks that of the Ramsar Convention. They include “perennial or seasonal areas of stagnant water or water bodies, whether natural or artificial, with significant ecological functions,” but exclude “paddy fields and artificial water bodies and beaches used for aquaculture” (art. 2, para. 2).
The Law adopts graded management and a lists system for wetlands (id.). Wetlands are classified as either “important” or “ordinary” based on their “ecological niches, areas, and importance to preserving ecological functions and biodiversity” (art. 14, para. 1). All mangrove forests—ecosystems that are critical to protecting coastal areas from erosion—are designated as important wetlands (art. 34, para. 2). Important wetlands are further divided into “nationally important” and “provincially important” ones (id.). The competent authorities are to issue a list for each category of wetlands (id. paras. 2–3). Important wetlands, especially nationally important ones, are afforded stronger protections. For instance, the occupation of nationally important wetlands is generally prohibited, save for a few special purposes, including building wetland conservation projects (art. 19, para. 2).
The Law requires periodic inspections and assessments of China’s wetland resources, the maintenance of a minimum area of wetlands in each province as determined by national authorities, and the formulation of wetland conversation plans by governments at or above the country level (arts. 12–13, 15). The Law prohibits a lengthy list of activities that damage wetlands and their ecological functions, including draining natural wetlands, permanently cutting off their sources of water, overgrazing, overharvesting, and overfishing (art. 28). It also bans other harmful activities specific to wetlands of particular ecological significance, including mangrove forests, peatlands, and the habitats of waterfowls (arts. 30, 34–35). Finally, the Law also lays down rules on wetland restoration (see Ch. IV).
The Law will take effect on June 1, 2022.
2. The new Law on the Prevention and Control of Noise Pollution [噪声污染防治法] renames and comprehensively revises the 1996 Law on the Prevention and Control of Environmental Noise Pollution [环境噪声污染防治法]. The new Law adds a new chapter on standardization and planning relating to the prevention and control of noise pollution, but has otherwise maintained the old statute’s structure. It includes separate chapters dedicated to addressing noise in four settings: industrial noise, construction noise, transportation noise, and the catch-all category of noise from other human activities.
The revision broadens the scope of the statute in several ways. First, “noise pollution” has been redefined to mean interfering with others’ ordinary daily lives not only by exceeding noise emission standards, but also by failing to take required measures to control noise when there is no applicable emission standard. Second, the revision widened the Law’s territorial scope by regulating rural, in addition to urban, noises. Third, under the new Law, “industrial noise” is no long limited to noise generated by fixed equipment, but encompasses all noise produced by industrial activities. And “transportation noise” now explicitly includes noise from urban railway systems.
Among the Law’s many new provisions, one addresses the (in)famous “square dancing”: an exercise routine performed to (often loud) music, typically by middle-aged and elderly urban residents, in public places like parks and plazas. The Law requires those engaged in such public recreational or fitness activities to comply with the public venues’ regulations on place, time, and volume for those activities, and prohibits the use of audio equipment to generate excessive volume (art. 64, para. 2). Local authorities are directed to first order violators to refrain from such conduct; if the latter refuse to comply, they may each be fined between RMB 200 and 1,000 (art. 82, item 2).
The Law will take effect on June 5, 2022, the World Environment Day.
Revised Decision on the Oversight of Economic Work
The revision to the NPCSC’s Decision on Strengthening the Oversight of Economic Work [关于加强经济工作监督的决定] is part of a systematic effort to increase the rigorousness and effectiveness of the national legislature’s oversight. Over the past year, the NPCSC has enacted and updated rules governing the oversight of the central budget and the management of state-owned assets.
The revision has considerably refined the rules governing the NPC and NPCSC’s oversight of the economy, almost tripling the number of articles and more than quintupling the Decision’s character count. Most of the revised Decision’s provisions concern the legislature’s oversight of the State Council’s formulation, implementation, and modification of annual, five-year, and medium- to long-term plans for national economic and social development. It specifies the deadlines by which the State Council must submit draft plans for the legislature’s review, the relevant materials the State Council must provide, and the focus of the legislature’s oversight at each stage of the process (see arts. 3–17).
In conducting other forms of economic oversight (e.g., hearing the State Council’s special work reports), the revised Decision instructs the NPCSC to focus on the State Council’s economic work in the following respects: “deepening reform of the economic system, optimizing business environment, strengthening scientific and technological innovation, promoting coordinated regional development, adhering to green and low-carbon development, ensuring and improving the people’s livelihood, promoting common prosperity, promoting high-level opening up, and safeguarding national economic security” (art. 18, para. 1).
A new provision requires the State Council to report to the NPCSC in each October on its financial work (art. 22). The reports should include information on the State Council’s implementation of monetary policy, the state of the financial sector and its regulatory oversight, financial support for the real economy, reform of the financial system, and its efforts to prevent and defuse financial risks (id.).
Notably, the revised Decision also gives the NPC Financial and Economic Affairs Committee a more prominent and active role in supporting the legislature’s economic oversight and in conducting routine economic oversight itself. For instance, State Council departments are required to periodically update the Committee on the implementation of five-year plans and update it on the implementation of the central government’s investment plan twice a year (art. 13, para. 3; art. 21, para. 3).
The revised Decision took effect on December 24.
- The NPCSC also adopted a minor amendment to the Trade Unions Law [工会法]. Most notably, it allows workers in social organizations and in the platform economy to join and organize unions (art. 3 as amended). The amendment takes effect on January 1, 2022.
- The Scientific and Technological Progress Law [科学技术进步法], the basic statute governing China’s scientific and technological (S&T) endeavors, received a comprehensive update last Friday, with the addition of three new chapters focusing respectively on basic research, regional S&T innovation, and international S&T cooperation, as well as other numerous changes. The revised Law will enter into force on January 1, 2022.
The NPCSC decided that the fifth and final session of the 13th NPC will convene on March 5, 2022. The session’s agenda, in addition to the routine items, will include a draft amendment to the Organic Law of Local People’s Congresses at All Levels and Local People’s Governments at All Levels [地方各级人民代表大会和地方各级人民政府组织法], a draft decision on the elections and quotas of the delegates to the 14th NPC, and measures for electing delegates to the 14th NPC from Hong Kong and Macao.