Pudong gets go-ahead to deepen its pilot administrative reforms

Pudong will streamline administrative approvals and delegate power to lower levels in a reform project that has been approved by the State Council.

The State Council, or China’s Cabinet, has given its go-ahead to deepen a pilot reform in Shanghai’s Pudong New Area that aims to streamline administrative approvals and delegate power to lower levels, improve government services and push forward reforms in various areas.

The Shanghai government will further develop Pudong as a pilot area to separate operating permits and business licenses, according to a statement of the State Council.

The reform is to streamline administration and create a fair market environment, delegate power and strengthen regulations at the same time, improve government services, and crack down on problems affecting market access.

It is on the basis of consolidating and deepening the achievements of reforms, to effectively distinguish the respective functions of business licenses and operating permits authorized by various departments.

The pilot reforms will cut or simplify 47 approval items, after all of China’s free trade zones have separated operation permits from business licenses, and eased regulations on 116 businesses requiring approvals, according to the statement released by the State Council yesterday.

The 47 approval items cover 10 fields, including medical care, investment, construction and transportation as well as the supervision of quality inspections.

For instance, all requirements on production approval that do not concern industrial policies or product quality and safety will be canceled, while restrictions on private medical institutions will be eased, according to the statement.

Licensed maritime transport businesses between the Chinese mainland and Hong Kong, Macau or Taiwan are allowed to use ships that are leased as their own. Previously, maritime transport was restricted to ships fully owned by the companies. 

Also, the requirements of owned ships for international maritime transport companies are loosened in the same manner. 

Meanwhile, foreign-invested construction enterprises will be allowed to develop construction projects that were previously prohibited.

Foreign-invested architectural design companies are exempt from having to undergo background checks of their involvement in foreign projects. Foreign-invested architectural firms will be approved for business permits before having to submit required materials within a designated period.

The criteria will also be applied to domestic and inbound tourism companies, as well as to foreign-invested travel agencies.

The program also includes reforms affecting public transport, farm produce, medical instruments, health-care services and quality supervision.

The pilot reform program in Pudong will run for a year before expanding to the rest of Shanghai as well as to other regions.

In 2015, the Pudong New Area was approved by the State Council to launch a pilot project that allowed an enterprise to begin operation activities simply after getting a business license.

China has decided to promote Shanghai’s reform of separating business licenses and administrative approvals in 10 pilot free trade zones to improve business environment. 

Premier Li Keqiang, who chaired a State Council executive meeting concerning the reforms on January 17, called for more efforts to remove barriers to market access and lower transaction costs.

Accelerating administrative reform and promoting business registration reform are considered key measures to further lower the market access threshold, reduce institutional transaction costs and activate the vitality of entrepreneurship and innovation, Li said. The key to the reforms is to prevent red tape in the future and replace approvals with strict pre and post-supervision, the premier added.

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