China issues action plan on further opening up its market

The General Office of the Communist Party of China (CPC) Central Committee along with China's State Council on Sunday published an action plan to guide the building of a high-standard market system in the next five years.

The plan indicates that building a high-standard socialist market system is of great significance in constructing a "dual circulation" economic development pattern, where domestic development is taken as the mainstay, and domestic and international development reinforce each other.

Property rights protection, which includes protecting property rights on an equal basis, will be improved, regardless of the public or private ownership status, and the judicial system in property rights protection will also be strengthened.

The plan reiterates that China allows foreign capital to have majority control in joint-venture banks, or securities, while asset management companies can be wholly foreign-owned or jointly owned, adding that China is formulating measures in managing bond issuance by overseas institutions in the domestic bond market.

Widening access

The plan calls for an orderly opening-up of the service industry, with the medical, education and environmental protection sectors taking the lead. Meanwhile, market access restrictions will be reduced.

It also calls for carrying out pilot projects to widen market access in selected regions, such as the Hainan Free Trade Port and the Guangdong-Macao Intensive Cooperation Zone in Hengqin.

The pre-entry national treatment and negative list management system will be improved, including reducing the negative listfor foreign access, while further expanding the listof sectors where foreign investment is encouraged.

Revised by Chinese authorities on an annual basis, the negative list specifies industries where foreign investors' activities are restricted or prohibited, indicating that industries, fields and businesses not on the list are open for investment to all market players.

The plan points to creating a fair market environment in which domestic and foreign enterprises are treated equally, and a market-oriented, legalized business environment that meets international standards.

It calls for publishing guidelines on overseas anti-monopoly compliance for enterprises, and strengthening anti-monopoly regulations in new business fields, such as the platform economy and sharing economy.

China vows to strengthen anti-monopoly efforts and prevent the disorderly expansion of capital this year. The country unveiled draft anti-monopoly rules last November on its online economy, including detailed information about disclosure requirements. The State Council then approved the establishment of an inter-ministerial committee, aiming to enhance efforts to combat unfair competition.

Earlier this month, the country launched draft regulationsaimed at toughening anti-monopoly supervision of payment services by non-bank institutions.