Better Property Protection Pushes SOE Reforms.docVIP

Better Property Protection Pushes SOE Reforms 　　A guideline on better protection of prop-erty rights was jointly issued by the Central Committee of the Communist Party of China （CPC） and the State Council in late November 2016. As the first state-level document regarding the issue， it particularly emphasizes equal protection of all kinds of property rights in accordance with the law. Hopefully， it will serve to fuel the ongoing mixed ownership reform of state-owned enterprises （SOEs）. 　　The new property rights protection rules have come at the right time， as pilot programs for mixed ownership reform of SOEs are reportedly to be issued by the central authorities soon. 　　During the previous round of SOE reforms， some enterprises successfully diversified their ownership structure. However， the government didn’t do enough to protect property rights， resulting in some prominent problems. First， it failed to give enough autonomy to enterprises and to tackle monopolies in some sectors. Second， while relaxing regulation extremely on issues such as asset evaluation and public transfer of property rights， it failed to ensure private investors enjoy equal rights in managing enterprises as public shareholders. Therefore in the new round of SOE reforms， the government must fulfill its responsibility to protect property rights properly. 　　Mixed ownership actually refers to partnership between capitals of different types of ownership. Regardless of the varying types， this cooperation must be mutually beneficial. The foundation for mutual benefit is based on the sound protection of property rights. 　　We can expect more supporting measures to be formulated following the new guideline. This will naturally break down various restrictions and establish a stricter and more clear-cut system for property right protection in order to ensure that enterprises of all types of ownership are safeguarded without discrimination during the reform process. 　　We must also note that propert