China advises ‘softer approach’ to law enforcement to ease jitters in private sector

“Constructive interaction between an environment with the rule of law and private companies is a requirement for developing the economy,” the piece read, pointing out complaints from some private enterprises over issues like “too frequent” inspections by local law enforcement and “inappropriate” administrative fines.

The editorial followed a report on Tuesday from the National Development and Reform Commission – China’s top economic planner – delivered to the standing committee of the National People’s Congress, the leading body of the country’s top legislature which works outside full sessions.

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What does it mean for the world when Chinese consumers tighten their belts?

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The commission stressed the need to support the country’s private sector, and made specific mention of an end to “selective” law enforcement methods.

The “practicality” of law enforcement came up in the Study Times piece as it addressed problems encountered in implementation.

“It is necessary to clarify different roles and functions along the chain of implementation,” the editorial said, “such as the combination of fragmented operations by different departments.”

“Novelty” is necessary when carrying out laws, the authors said, which could reduce “inappropriate” disruptions to company operations at a time when the economy is facing downward pressures.

“Currently, law enforcement work at the grass roots level focuses on small and micro-sized enterprises,” the piece noted, citing “integrated investigations” and the development of “joint law enforcement plans” as examples of potential reforms.

The Study Times also emphasised “agility” in terms of the capability of law enforcement – especially among on-the-ground personnel – and suggested tackling situations in effective and efficient ways.

“Simplifying the process of implementation and using communication, negotiation, coordination and participation instead of hard penalties to redress issues are encouraged,” the editorial said.

In recent weeks, controversy has been generated over Chinese media reports that several listed firms had been asked by local governments to pay tax bills dating back as far as the 1990s, and the creation of several joint task forces between police and tax authorities has made businesses wary of what may come next – compounding an already weak outlook on China’s overall economy.
The State Taxation Administration, however, has denied that it would launch a national investigation.

In addition to the Study Times piece, a front-page commentary by party newspaper People’s Daily said on Wednesday that China will continue on the path of economic reform, with new policies strengthening “coordination” to “prevent [departments] working separately and restraining each other”.