China 2014 Regulatory Transparency Scorecard

Executive Summary

Transparency—including solicitation of public feedback during the creation of new laws and regulations, open government decision-making, and the ability to access information—is consistently cited as a top concern for US-China Business Council (USCBC) member companies in USCBC’s annual membership survey on China’s business environment. As part of efforts to monitor this issue, USCBC conducts an annual review of selected PRC government agencies’ records in increasing transparency in their rule-making processes. This year’s report, covering January to December 2013, shows that China continues to significantly lag in its commitments and implementation in promoting regulatory transparency. The National People’s Congress (NPC), China’s legislative body, and the State Council, the equivalent of the United States’ cabinet, have made high-level commitments to improve regulatory transparency. In 2008, the NPC announced that it would solicit public comments on most draft laws and amendments it reviews. The State Council pledged in 2008, 2011, and 2012 to release drafts of all trade- and economic-related administrative regulations and departmental rules for 30-day public comment periods.

• USCBC analysis of the NPC, the State Council, and selected government agencies shows varying levels of compliance with these transparency commitments and that all agencies need considerable improvement.
• The NPC continues to have a mixed, though slightly improved record of posting draft laws for comment for a full 30-day period. Sixty-six percent of laws passed over a recent twelve-month period had been published to the NPC website for comment at some point during their drafting process.
• The State Council posted less than 10 percent of its own administrative regulations and departmental rules for public comment through the State Council Legislative Affairs Office (SCLAO).
• Other government agencies did no better. During the twelve-month period tracked in this report, the seven agencies tracked—the National Development and Reform Commission (NDRC), Ministry of Commerce (MOFCOM), Ministry of Finance (MOF), Ministry of Industry and Information Technology (MIIT), General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ), State Administration of Industry and Commerce (SAIC), and Ministry of Human Resources and Social Security (MOHRSS)—posted a small fraction of relevant documents for comment on either the SCLAO or their respective agency websites: Less than 10 percent of regulations to the SCLAO site and less than 17 percent of additional regulations to their agency sites.
• Part of the challenge of tracking transparency lies with the lack of clarity about what regulations fall under China’s commitments. USCBC’s report uses two filters for including regulations in the report: A “narrow” interpretation that includes only those documents explicitly labeled as State Council or departmental administrative regulations in other legal documents, and a “broad” interpretation that includes other regulations that appear to function as State Council or departmental administrative regulations.
• Among the small percentage of regulations that are posted for public comment in line with State Council’s commitments, however, the majority is posted for at least the full 30-day period, and the average comment period for administrative regulations and departmental rules posted for public comment on either the SCLAO or agency websites exceeded 24 days.

USCBC recommends that the PRC government ensure that all administrative regulations and departmental rules are posted on the designated SCLAO information website comment page for a full 30-day public comment period. The office should also consider going further by posting for a longer comment period of 60 or 90 days. For additional recommendations, see page 8.