Since July 1st, 2004, a series of new regulations and rules are put into effect.
For instance, China's first Rules of Road Transport will come into force on July 1st, 2004 and regulates that any and all vehicles will be deprived of operation qualification with of or over three-times over-loading/over-limit. Measures of Shanghai Municipality for Implementation of Insurance for Injuries Suffered at Work effecting on July 1st, 2004 determines plan of both fundamental and floating expenses rates. Only record system for Shanghai's marketable housing sales is entering into full-scale implementation phase where all housing for sales said good-bye to manual contracts. Among others, the formal implementation of the Law of the People's Republic of China on Administrative License is the most noticeable. Shanghai has resolved to stop execution of 36 administrative license items established by local regulations and 66 by guidelines and regulatory documents of the municipal government, a relatively large portion of which are closely impacting business operation of enterprises.
What kind of impacts will those laws, regulations and rules give on the relevant economy and life? Inside-industry experts are analyzing as follows:
Law on Administrative License
Over 20,000 enterprises are free from restrains
Canceled: review and issue of production permission for important products
Analysis: this symbolized that the system of Production Permission of Important Products enforced for 14 years in Shanghai and involving 11 key categories of products come to the formal end. More than 20,000 enterprises in fields of beverage, gas burners, exterior wall coating materials, electrothermal mosquito killers, moon cakes, freezing potables, water purifiers, drinking natural mineral water, and drinking pure water can be free from restrains ever since.
The municipal bureau of quality and technical supervision stated that the state has enforced 10 compulsory standards including QS market access system, 3C compulsory certification, and limiting harmful materials to food industry, home appliance products, and building products since 2002. The Production Permission system causes the de facto repeated certification. In addition, any application or exchange for such Permission needs three months. Cancellation of such Permission means less restrainer to enterprises and is in favour of their decreasing business costs.
Same and equal treatment to out-of-town building companies entering into Shanghai market
Canceled: Permissions for Building Companies from Other Parts of China Entering into Shanghai to Construct, Permissions for Engineering Survey and Design Institutes from Other Parts of China Entering into Shanghai to Operate Businesses of Survey and Design, Permissiosn for Companies from Other Parts of China Entering into Shanghai to Operate Consultation of Construction Costs, and issue of Use Permissions of Building Engineering Materials
Analysis: According to the Office of Management of Building Industry under the Municipal Commission of Construction, cancellation of the above 4 administrative review and approval items are for creating an open, fair and just building industry market in Shanghai. This also means that Shanghai's construction industry administration body is realizing transformation of functions and is a key measure adopted in establishing a government in service, of liabilities and under rule of law. Companies in construction, survey and design and construction costs consultation from other part of China entering into Shanghai market will meet no doorsills, and can as same as Shanghai's companies participate market competitions in a equal manner.
Some people worry that suck cancellation may be likely to pass away the sham as the genuine which may affect the quality of construction. With regard to this concern, official in charge of the relevant authority held that bid invitation and submission and other marketizing measures to remains goods and discharging the unqualified under the background of market economy. To government departments, their administration levels and efficiency may be advanced through more scientific daily management and subsequent supervision.
Advertising scrolls and boards shall not affect growth of trees any longer.
Canceled: review and issue of permission for suspended articles on street trees, review and issue of permission for higher-power speakers that may cause noise pollution in streets, parks, malls, schools and other public occasions, and review and issue of Certificate of Products with Environment-friendly Signs to industrial and agricultural products.
Analysis: Cancellation of review and issue of permission for suspended articles on street trees does not mean that Shanghai opens use right of big trees. On the contrary, no color lanterns, advertising scrolls, boards and any other articles shall not mount on trees. Any violation shall be subject to fines ranging from RMB 50 up to 1,000.
As introduced by the relevant official in charge of the municipal afforestation administration bureau, the Regulations of Shanghai Municipality on Administration of Tree Planting And Afforestation promulgated in 1987 has definitely provided that "shed building leaning on trees and other conducts that disturb growth of trees and forests are prohibited" provided, however, that "the temporary suspension on trees for special reasons shall be subject to afforestation administration authority". It is understood that the cancellation of this aspect this time leads to the result that any suspension of any articles on trees by any entity or individual for any reason shall be illegal.
Maritime affairs in ports: reviewed and approved by market itself
Canceled: review and approval of transportation of goods beyond port storage period, review and approval of transportation of goods within port storage period, review and approval of stacking businesses of transported goods in ports, and review and approval of business operation of in-Shanghai water transportation of goods and passengers by water transportation operators from other parts of China
Analysis: Upon cancellation of the above four review and approvals, the port transportation market itself becomes the "master" of such review and approvals. According to introduction by the official from Legal Affairs Office of the Municipal Bureau of Port Administration, there is a "port storage period" of 7 days for containers and 10 days for general goods due to limited capacities of throughput and turnover of Shanghai Port in order to prevent goods owner to take the port as warehouse for a long time.
Nowadays, thanks to continuous enhancement of capacities of Shanghai Port, contradiction between stacking and transportation of goods does not exist any more. The period of storage in the port and the date to be shipped shall be controlled and settled by subjects of the port transportation market subject to their own demands.
Energy-saving inspection and test industry: self-disciplined
Canceled: certification of qualification of energy-saving inspection and test service bodies
Analysis: As energy-saving has been the highlight of the whole society, this energy-saving service industry is becoming the excellent money-printing machines in many investors. Any and all intermediate services related to energy-saving, no matter the test of energy-saving, or assessment of energy efficiency, or technical consultation, are demonstrating tremendous money-making opportunities. However, not all investors can access to this field in the past. According to the applicable regulations, energy-saving intermediate service companies shall be "certified for qualification of energy-saving inspection and test service bodies" by the municipal economic commission. The cancellation of this review and approval means there is no doorsill for access to this market any longer. For investors interested in investment into energy-saving intermediate services, opportunities are more and more.
Other regulations and rules
Since July 1st, 2004, other regulations and rules come into force, too:
1. Newly amended Law of the People's Republic of China on Foreign Trade
Since July 1st, 2004, China completely cancels the foreign trade access doorsill and the mechanism of review and approval wherefor, and adopts the system of registration for reference. It is the first time to allow natural persons to engage in foreign trade. Any and all natural persons intending to engage in foreign trade shall, firstly, go to administration of industry and commerce, and then, upon approval whereby, register in Shanghai Foreign Trade and Economic Cooperation Commission for reference. No requirements for registered capital and the company type shall be one with unlimited liabilities with regard to natural persons engaging foreign trade.
2. China's first Regulations of Road Transport
Operation qualifications of any and all enterprises with three-times over-loading/over-limit detected will be revoked. By collecting operation and over-loading information of freight companies and drivers wherein in Shanghai, a credit archive whereof is formed by the municipal land transportation administration authority as the basis of possible punishment.
3. One-stop disposal of transportation-related affairs
Disposal of administrative affairs related public transportation, taxi, rail transportation, land transportation and auto maintenance services shall be unified and moved to the Center for Disposal of Urban Transportation-related Affairs. Any and all items accepted by the Center will be publicized on Shanghai Transportation Site (http://www.jt.sh.cn).
4. Measures of Shanghai Municipality for Implementation of Law of the People's Republic of China on Assessment of Environmental Effects
No matter urban planning or construction projects shall all pass the environment-friendly assessment, which shall be supported by report of assessment of environmental effects issued by qualified assessment body, in the future.
5. Sales contracts of marketable housings in Shanghai go online for reference registration
Since July 1st, 2004, any and all sales of newly-built marketable housings in Shanghai require online contracts for reference and registration. Housing buyers can not manually sign a contract with developers. The valid time for the online realty transaction shall be from 8 a.m. up to 10 p.m. in order to stop housing selling at the midnight by developers.
6. Notice on Regulating Issues Related to Management of Invoices of Insurance Intermediate Services
The unified invoices of insurance intermediate services are put into practical use since July 1st, 2004. And any and all other kinds of invoices for this field will cease to use. This means that illegal embezzlement in a disguised form in settlement of commission charges between the insurance intermediate organs and insurance companies will no longer exist, and heavy losses of the state taxes can be avoided.
7. Measures on Administration of Entities Conducting Agrochemicals Registration Experiments
This Measures formulated by Ministry of Agriculture defines the qualification for entities which apply for agrochemicals registration experiments in a detailed manner, and also provides that the valid term for entrustment certification to entities conducting agrochemicals registration experiments.
8. Newly amended Regulations of the People's Republic of China on Reporting and Statistics of Over Water Accidents of Fishery Vessels
From now on, the approach of statistics of over water accidents of fishery vessels will be as similar as that of accidents in other industries. And the statistics of this kind will be integrated into the regular reporting system of State Safe Production Bureau.
9. Shanghai's local Regulations on Transactions in Live Chicken Markets
Live chicken retail spots shall be located in the food market with an area more than 1,000 m2 and far from the downtown. Tempered glass shall be used to separate customers and sales zone and slaughtering zone. The wholesale markets shall cease business 1 day per week, and the retail spots shall 2 days per week for overall cleaning and sterilizing to buildings and relevant equipments and facilities within the trade and slaughtering zones according to the applicable hygienic provisions.
10. Buy antibacterials upon prescriptions only
Medicine retail businesses cannot sell all kinds of antibacterials not listed into the medicine catalog of OTC unless upon prescriptions issued by the practicing doctors, which means consumers cannot easily buy any antibacterial other than 180 kinds of OTC antibacterials
11. No GMP certificate means shut-down of business since July 1st, 2004, which is a line between life and death to those enterprises manufacture medicines. In case they fail to obtain GMP certification before the deadline, they shall stop production of their drugs unconditionally. There are remaining 10-plus pharmaceutical manufacturing enterprises not acquiring GMP certificates yet.