Business and Human Rights

Almost half of all books, films, music CDs, and software sold in China in 2005 were pirated, according to a September 1 Xinhua report (via the People's Daily Web site). According to the report, the figure represents a 0.5 percent decrease from 2003, and the first drop in the publication piracy rate in six years. Xinhua characterized the drop as "tiny," and attributed it to the "government's effort to crack down on piracy." According to Xinhua, Chinese authorities have confiscated 8.3 million illegal CDs and DVDs as part of a 100-day crackdown on piracy that began on July 25.

The National Development and Reform Commission (NDRC) has issued an order prohibiting foreign participation in equipment procurement for projects related to China's national high voltage electric grid, according to an Economic Observer report (in Chinese). The report says that, except for "key technology that can be provided by foreigners," the NDRC would prohibit foreign enterprises and joint ventures in which foreign enterprises hold controlling shares from manufacturing or supplying the estimated 250 billion yuan (US$33 billion) worth of equipment that will be required for the 15-year construction project. Instead, the government will use the project to spur the development of domestic enterprises.

The following is a partial translation by CECC staff of an article entitled "Five Government Agencies Formulate the 'Certain Opinions Regarding the Introduction of Foreign Investment into the Cultural Domain'," published by Xinhua on August 4, 2005.

Under an agreement worked out January 20, China will allow the WTO Secretariat to prepare a report on the competitive impact of the end of the international textile quota system for Least Developed Countries (LDCs). The LDCs had requested a more extensive report last October. That request, which required the consensus of all WTO members to proceed, was blocked by China. China has acquiesced in the recent request for a more limited report, which will study ways to improve the competitive position of the LDC members of the WTO rather than examining other factors experts believe will lead to China's dominance of the global textile industry.

Yu An, a professor at Qinghua University who participated in drafting China's Government Procurement Law (GPL), has said that there is a possibility that China's government procurement market could open to foreign companies after four years, Beijing Business Today reported (in Chinese) on April 27. According to the article, this step implies that "there remains only four years of protection in the government procurement market for domestic brands." In July 2002, the China Economic Times cited (in Chinese, via Xinhua) Zhu Shaoping, who was also one of the drafters of China's GPL, as predicting that the "period of protection" for domestic enterprises in China's government procurement market would end by 2005.

The construction of a controversial power plant in Shanwei city, Guangdong province, has continued on schedule after provincial authorities promised full support and "conditions of social stability" for the continued construction, based on a December 22 news update on the Web site of the Guangdong Red Bay Generation Company, which is building the plant. The update followed a Washington Post report on December 21 that concluded that local opposition to the power plant had been "reduced to submission." Following violent confrontations with the People's Armed Police (PAP) on December 6 and 7, authorities sealed off Dongzhoukeng village in Shanwei and placed it under heavy police surveillance.

The People's Bank of China (PBOC) issued a series of draft regulations for public comment on April 12 aimed at "beefing up efforts to rein in money laundering across its banking, securities, and insurance sectors," according to an April 13 Xinhua article. Chinese officials and China's state run media report that the regulations are needed to improve China's commercial environment and combat widespread embezzlement, bribery, and financial fraud. The Asian Development Bank estimates that more than 200 billion yuan (approximately US $25 billion), or 2 percent of China's gross domestic product, is laundered on the mainland each year.

Xinhua reported that, under the draft regulations, companies would be required to monitor customers' identities, and to report large or suspicious transactions. The regulations included:

Ministry of Land and Resources (MLR) Vice Minister Lu Xinshe expressed continuing concern over arable land loss at a National Conference on the Protection of Basic Agricultural Land, according to an October 24 report by the Legal Daily. Lu revealed that the central government has renewed its focus on monitoring the occupation and use of basic farmland and will require local authorities to announce and hold public hearings before they appropriate arable land in the future.