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Last Updated: Thursday, 8 March 2007, 13:10 GMT
New property law shakes up China
By Songyan Sui
BBC Chinese Service

China's legislature, the National People's Congress (NPC), is currently debating a property rights bill which will take account of individual assets for the first time. The draft law is long-awaited but has taken many twists and turns along the way.

China's National People's Congress
The bill has appeared before the NPC before

Legal protection of private property and assets has been so common in many countries that people can take it for granted.

Yet in China it would mark a very important step in the country's belated march to a real market economy.

Now going through its eighth reading, the property rights bill stipulates equal protection of rights for private property and public assets.

The bill has caused quite a stir since it was first published in 2002, and the voice of opposition is still rumbling in the Great Hall of the People.

Critics say that of course it is important to protect private property and to reassure private businessmen and entrepreneurs of their legal rights to their hard-earned assets.

But they argue that the new law will also legalise privatised state-owned assets obtained through illegal means, not to mention that it contradicts the official slogan of building socialism with Chinese characteristics.

'Betraying socialism'

Supporters of the bill say the affirmation of property rights, especially private property rights, protects the material interests of millions of working people and entrepreneurs in the private sector.

It encourages more people to create wealth for themselves and for the nation, they say.

Chinese police (TV grab)
Protests over illegal land grabs have led to violent confrontations

Many had expected the much revised bill to be passed at last year's NPC session.

However, an open letter by Professor Gong Xiantian from Peking University Law School derailed the process.

According to Prof Gong, the proposed law was unconstitutional on several grounds:

  • It conflicts with the Chinese constitution, which stipulates: "Socialist public property is sacred and inviolable"
  • It only protects the assets of a small minority of rich people, while the poor essentially have nothing worth protecting
  • It betrays the basic principle of socialism

Prof Gong even predicted that the legal code would lead to the loss of state-owned assets at a greater rate.

He attacked the bill as veering towards the "fallacies" of capitalist civil codes, the globalisation of capitalism and neo-liberalism in economics.

So the draft law was deferred.

Political and ideological row

Observers say there is no doubt the bill is almost certain to be passed in the NPC this year despite the heated debate brought about by the open letter.

Still, the "Work Report" by Chinese Premier Wen Jiabao, read out at the opening session of the NPC, does not mention this law nor much about the protection of private property.

Instead, his report highlights issues concerning people's livelihood such as health care, education and rural development.

Obviously, with their slogans of "people first" and "harmonious society", China's leaders have noticed the social and political risk resulting from the huge gap between the new rich and the poor. They have to take into consideration views and suggestions from left-wing academics.

There is no doubt that the debate about the controversial property rights law has gone beyond the economic dimension. It has evolved into a political and ideological row.

Sooner or later, the bill will be passed. In fact, this law could even be passed by the standing committee after the current NPC session is closed.

Then it could be signed into law by a decree from the country's president.

But the government should take action to make sure the public, especially the poor, believe that although they only have their begging bowls to protect today, some day their property may include big cars and houses.

When the final draft is approved, China's rich and poor alike will have a legal right to what they accumulate in wealth in what the authorities dub a harmonious society.

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