Draft National Assets Law: Five Person Relationship Structure To Build A Framework For State Owned Assets Management

The draft of the state assets law touches the core: "five person relationship structure" to build a framework for state owned assets management.

The State-owned Assets Law (Draft) (hereinafter referred to as the "draft of state assets law") is increasingly reaching the core of the problem.

Since the first session of the Ten Session of the thirty-one session of the National People's Congress in December 2007, the preparations for the second instance are being intensified.

The principal person in charge of drafting the draft law of state assets, Ann Jian, deputy director of the law and Work Commission of the National People's Congress, arrived in Sichuan in April 7th to conduct the investigation for the second instance of the draft.

Relevant officials from nine provinces and cities went to Sichuan, and drastic discussions were held on the drafting of the state assets law.

The reporter was informed that although the content of the review was basically clear, the focus of the discussion was on how to further clarify the relationship between the five person relationship structure, namely, the investor, the trustor, the operator, the supervisor and the judicial officer.

"Only when these key problems are solved can we talk about specific issues.

Li Shuguang, a member of the drafting group of the state assets law and professor of China University of Political Science and Law, told reporters.

This is the first time that state-owned assets supervision has touched such a core level.

Although China has tens of billions of (or more) huge state-owned assets, how to define and control these complicated assets is in a "vague" position from theory to reality.

Now, at the legislative level of state assets law, officials have discussed this issue and aroused widespread concern.

Li Shuguang told reporters that, first of all, state assets supervision should establish a client structure of state-owned assets, and the client should ultimately be the National People's Congress.

In Li Shuguang's view, the NPC, as a representative body of the people, should enjoy the ultimate power of state assets.

However, from the perspective of the current system, the power law was awarded to the State Council from the "property law" to the "Regulations on the pformation of business operation of industrial enterprises by the whole people" and the Constitution in 1992.

Therefore, the State Council has assumed the role of client of state-owned assets.

"But in the long run, this is just a pition.

"Li Shuguang holds this view.

The second level is the investor.

The investor should be authorized by the client.

Because the power of the client is the power of the state, the specific exercise should correspond to a specific investor, so as to solve the limitation of the principal-agent chain, the unclear law and the concept of no client and contributor in the planning system.

The problem now is that there are managers in operating assets, including financial and non-financial assets, but there is a need for a manager in the future.

Li Shuguang believes that only a specific boss can not do so. China's state-owned assets are very large. In addition, it has not cleaned property relations of state-owned assets for many years. Therefore, from a large angle, state-owned assets should have a representative of investors.

However, it is necessary to have specific operators for operating state-owned assets.

The operator is authorized by the investor and is responsible for the operation of state-owned assets within a certain jurisdiction.

The operator is the third level.

The fourth level of the five person relationship structure is the regulator.

The regulator is separate from the investor and the operator, and can supervise both the investor and the operator at the same time.

The regulator is an independent government department. Li Shuguang believes that it can be re established. It can also be established on the existing basis, such as the establishment of the State Assets Supervision Bureau in the Ministry of supervision.

"At present, the SASAC is both a contributor and a supervisor, and in itself can only be regarded as a pitional practice.

"Li Shuguang said.

In the five person relationship structure, the last one is a judicial person, because supervisors are only likely to be incompetent from the perspective of the government, and they may intervene too much in the directors, supervisors and senior executives of state-owned enterprises.

At this time, the directors, supervisors and executives of state-owned enterprises will have to complain about administrative intervention. An independent judiciary is needed to provide the final judicial relief.

Li Shuguang believes that these can be assumed by the court.

"If our state-owned assets management system and the state-owned assets law can enter the framework of five people in the future, the relationship of rights, obligations and responsibilities in law will be clear.

"Li Shuguang said.

Li Shuguang believed that although the reform of state-owned assets and state owned enterprises has been a difficult and important issue in the past 30 years, it has not been clear about the relationship in law.

The sixteen set up a new mode of supervision of state assets, that is, a contributor, three combinations (management of assets and management of people and management), and three unification (rights, obligations and responsibilities). In Li Shuguang's view, this is mainly from the economic system.

"The practice of the SASAC in the past 5 years and more than 20 years has proved that there are still problems in designing and supervising the operation and supervision of state-owned assets purely by means of economic and administrative means.

The unclear position of law and the indistinct relationship between rights, responsibilities and obligations are the root causes of problems.

"Li Shuguang told reporters.

From Li Shuguang's point of view, it is a long-term and ideal target plan for China's state assets supervision to identify the rights, responsibilities and obligations of state assets.