Five-Year Plan Calls for News Regulator To Maintain Status As News Provider

December 8, 2006

The 11th Five-Year Cultural Development Program issued by the State Council on September 13, 2006, states that one of the Chinese government's goals is to ensure that the Xinhua News Agency's news information products hold a "proportion of the domestic market." In addition to being China's largest news agency, Xinhua is a Chinese government bureau directly subordinate to the State Council and, pursuant to the Decision of the State Council Establishing Administration Examination and Approval Matters That Must Remain Subject to Administrative Licensing, is the regulator of foreign news agencies providing financial information in China.

Xinhua's dual role as both a government regulator and market competitor has raised concerns regarding China's compliance with World Trade Organization (WTO) commitments and bilateral agreement obligations. When China acceded to the WTO in 2001, the Chinese government agreed in its Schedule of Specific Commitments on Services that it would allow foreign investment in the "Provision and transfer of financial information, and financial data processing and related software by suppliers of other financial services." On September 10, 2006, Xinhua issued the Measures for Administering the Release of News and Information in China by Foreign News Agencies (Measures), which prohibit foreign news agencies from distributing news and information in China without government permission, and require foreign news agencies to be licensed by Xinhua and to submit all articles to a Xinhua-approved agency for distribution.

In the November 10, 2001, Report of the Working Party on the Accession of China, the Working Party also noted: "The representative of China confirmed that for the services included in China's Schedule of Specific Commitments, relevant regulatory authorities would be separate from, and not accountable to, any service suppliers they regulated, except for courier and railway transportation services." The Office of the U.S. Trade Representative (USTR) stated in its 2006 National Trade Estimate, however, that the Chinese government has not established such an independent regulator, and Xinhua remains a "major market competitor" of foreign financial information service providers in China.

According to the American Chamber of Commerce's 2006 White Paper, foreign companies have complained that Xinhua has been using its regulatory authority to increase control over the distribution of content, and has been expanding the definition of a news agency so as to establish a monopoly on the dissemination of sports and financial news. The October 11 edition of Inside US-China Trade (subscription required) cited an unnamed USTR spokesperson as saying that "officials are exploring whether the new rule violates China's WTO commitments." That report also cited unnamed sources as saying that the Measures may also be in violation of a bilateral agreement between the United States and China under which China agreed that Xinhua would not act as a review board for foreign news.

In addition to ensuring Xinhua retains market share, the 11th Five-Year Cultural Development Program also stated that the government intends to increase its support for Party newspapers and periodicals, as well as "news agency, radio stations, television stations, major news Web sites, and current events periodicals." The program also calls for developing domestic media outlets into "famous brands" and ensuring they hold a "relatively strong influence on society," and remain a "principal force in public opinion." The program says that the Party's leadership of cultural work should increase, and that "relevant departments" should actively support and cooperate with Party committee propaganda departments. Finally, the program also provides guidelines for the content and manner of news reporting in China, including calls to:

  • Increase the media's ability to guide public opinion capabilities, particularly on "social hot-button issues."
  • Strengthen the appeal and infectiousness of news propaganda.
  • Publicize what the Party stands for.
  • Broaden the influence of positive propaganda.
  • Increase propaganda reports on important topics.

At the Party Central Committee's sixth plenum in October, the central committee placed similar demands on the media, calling on them to build a "harmonious society" by "insisting on the correct orientation" of public opinion, "publicizing what the Party stands for" and providing guidance on "social hot-button issues."