Shanghai and Beijing are eliminating hundreds of administrative licensing requirements in accordance with the new Law on Administrative Licensing, which will take effect on July 1. Administrative licensing, the formal legal permission needed to conduct business or business-related activities, is a major governmental function exercised by authorities at all levels.

"Around half of the 217 administrative licenses established by law and local governmental regulations will be canceled," said Jiao Yang, a spokesperson for the Shanghai municipal government, on Wednesday.

Doing so will enable the Shanghai government to strengthen its service functions in the market economy environment, said Jiao.

Shanghai authorities have pledged to give priority to market competition and hand more power to industry associations and other intermediary agencies in terms of licensing. The city government will also closely follow up the central government's decision to phase out some national administrative licenses.

Currently, over 1,000 procedures requiring state-level administrative licenses are being implemented in the city, according to Jiao.

On Tuesday, the Beijing municipal government announced that it plans to eliminate 174 local administrative licensing items: more than 50 percent of the items that currently require government approval.

Topping the list is elimination of the employment identification cards for people from areas outside the capital who are seeking work in Beijing, according to a Xinhua report.?

Also, former farmers no longer need official permission to change from rural to non-rural residence registration when they are hired by a company located in urban Beijing.

Various departments of the Beijing municipal government have reported 2,037 administrative items that need to be cleared, with 1,663 confirmed to fall within the category of administrative licensing items. Of that number, 19 percent are established by the Beijing municipal government and the remainder by the central government.

Of the 308 local administrative licensing items, 174 will be cancelled, 98 will be maintained, 30 items have been combined with others and six have been altered to require temporary permission.

The items that are being freed from administrative licensing are mainly those that can be regulated by the market or decided by enterprises.

Mayor Wang Qishan has ordered all departments and governments at the district and county levels to revise procedures that are not in accordance with the Law on Administrative Licensing.

Over the years, hazardous expansion of licensing requirements, over-elaborate procedures, inefficiency and under-the-table deals for granting licenses have seriously infringed upon the rights and interests of individuals and corporations.

The Law on Administrative Licensing, which was passed by the Standing Committee of the 10th National People's Congress last August, confines the power of establishing administrative licensing procedures to the governments at central and provincial levels. It also forbids unnecessary administrative licensing and simplifies procedures for acquiring licenses.

(China Daily April 8, 2004)