The state-owned assets law is an imperfect guardian
A newly-published law is a significant step towards better regulation of operational and finance state assets, but implementation is likely to raise accountability, administrative and judicial issues. Further legislation is essential
Issue: November 2009
Keywords (click to search):
SOAE
Law on State-owned Assets of Enterprises
state-owned enterprise
SOE
Managing state assets effectively is important. It is particularly so in China because of the planned economic system which favours state ownership. Economic reform has led to a large number of state-owned enterprises being converted to corporatised enterprises. In order to efficiently manage the huge amount of state assets in these enterprises, a state assets management system (SAMS) was established in 2003. However, management of state assets was not problem-free: many government officials, company directors and managers have been prosecuted for corruption in connection with stealing and illegally transferring state assets. People, therefore, started to question the state supervision system and this has resulted in a new regulatory process set out in the PRC Law on State-owned Assets of Enterprises (中华人民共和国企业国有资产法) – the SOAE Law – promulgated by the Standing Committee of the National People’s Congress on October 28 2008. It became effective on May 1 2009.
The SOAE Law has...
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