The government will further eradicate repetitive approvals, which require documents to be submitted to different departments at the same time, and streamline online application process to give the green light for investment projects.
The decision — marking a further step in enhancing administration and delegating power — was taken on Nov 5 at an executive meeting of the State Council presided over by Premier Li Keqiang.
Li stressed the urgency to remove time-consuming steps from the approval process to make it more efficient.
“We should try our best to return to the market what the market is capable of handling,” he said.
Listening to suggestions
The Premier said at the meeting that he heard the strong demands to reduce or cancel the time-consuming approval procedure from companies located in either coastal areas or central and western regions.
Discussions had been held earlier this year between the Premier and companies, especially, small and medium-size enterprises, to better understand their difficulties and suggested remedies and he cited various problems faced by enterprises.
In one case the head of a grain distribution firm had to apply for a permit to distribute food even though he had already been granted a business license.
In another case an entrepreneur had to wait for a permit to start a property company despite a license being granted.
And finally, an enterprise involved in overseas investments had to delay their launch because they needed an approval for each individual investment.
“Entrepreneurs complained to me that it seems that the government is dealing with its own capital instead of theirs,” Li said.
He asked all departments to eradicate approvals that were not legally required.
During a discussion on regulating intermediary services, an official with the State Administration of Work Safety highlighted that the problem of inadequate documentation must be tackled.
Some unqualified firms, he said, obtained fake investment approvals and participated in projects even though the intermediaries had not obtained the proper documentation.
Such agencies should face severe sanction, he said.
“It is a good idea,” the Premier nodded in appreciation, asking related authorities to heed the suggestion.
The Premier also noted that business owners were calling for stronger government regulation.
“I held a meeting with the owners of several Internet companies the other day. They all called for stronger government supervision to crack down on counterfeit and defective products,” he said.
“Other entrepreneurs complained to me that they were not paid even if a commercial contract had been signed. As the regulators failed to exercise supervision, they had to turn to a collection agency in the end. This is like the law of the jungle, isn’t it?” Li asked in a raised voice.
“The market should, and hope to be, regulated. The supervisory departments must fulfill their duties.”
The Premier asked departments to shift their focus to supervision from prior approval with the aim of creating a fairer environment and vitalizing the market.
Promoting parallel approval
The meeting also discussed promoting online parallel approval of investment projects, a procedure that will allow various departments to give simultaneous approval.
Li commended the practice as a streamlining measure.
“Companies have to visit five or six departments in order to complete a certain procedure. This has to be changed,” he said.
Li expressed his appreciation for the stipulation that the item code — generated once an application is accepted — will be the only identification and be connected with the social credit system.
He said that reform measures in recent years, such as business licenses being granted earlier than the permits, have greatly helped enterprise registration.
However, he said, a registered company’s codes are not the same in different departments. This not only adds to difficulties for applicants, but also hinders the establishment of a social credit system.
The Premier asked more to be done in accelerating building a unified credit system, which serves as the foundation for an effective market regulation.
“All departments should endeavor to make sure that all reform measures are put in place,” he said.