Regulatory and commercial developments are shedding light on the genesis of a new economic age in China. Richard Li and Vanessa Ip ask the experts for some old wisdom on the new rules
China’s economy is moving towards a new era, one that should feature less administrative interference, more compliant commercial behaviour and more innovation.
Reform decisions issued in the Third Plenum, held in November 2013, signal a determination at the top level of government to make the economy more market-driven, and the nation’s major regulatory authorities have been following this principle. The National Development and Reform Commission (NDRC) has issued measures to lessen its control of overseas investment, while the China Securities Regulatory Commission (CSRC) is in the process of changing its approval practice for initial public offerings (IPOs) to a new registration system. The Shanghai Free Trade Zone (FTZ) has also been launched to experiment with new regulatory models and further open the market to facilitate cross-border business.
But while tending to exercise less control over market players’ decisions, the Chinese government has tightened its supervision of irregular business activities. John Huang, the Shanghai-based managing partner at MWE China Law Offices, points out the implications of the GlaxoSmithKline commercial bribery case, and the NDRC’s decision to fine six formula producers for their price monopoly behaviour.