Regulatory policy

Regulatory Reform in China


 OECD Review of Regulatory Reform

Defining the Boundary between the Market and the State



The OECD Regulatory Reform Review of China highlights China’s advance to a market economy as among the greatest economic success stories of modern times. In simple terms, China has achieved in three decades what has taken most OECD countries a century or more.

The process responsible for Chinese transformation has been unconventional in its sequencing but ultimately based on principles underpinning successful development in other countries. Pragmatism – particularly the willingness to make timely corrections to reforms when necessary without abandoning basic objectives – and the fostering of a progressively greater role for the private sector have been critical to the success of the process. The strengthening of regulatory institutions and practices will be high on the policy agenda in China over the next several years.


The Review highlights two overarching areas that are likely to be especially important to further progress with regulatory reform. The first comprises efforts to strengthen the rule of law through judicial and other reforms. The Review stresses the importance of improving enforcement of laws and regulations. Judicial interpretation will be a key element in the process of clarifying laws and regulations, and is likely to involve far more proceedings in which government agencies are parties than in the past. Efforts now under way to improve the qualifications and training of judges and other officials in the judiciary will improve enforcement, but further efforts may be needed to better insulate the judiciary from undue interference, including from government and political officials.



The second area that will be critical to the success of regulatory reforms is comprehensive reform of relations among central and sub-national governments. The Review highlights the obstacles to reform often posed by conflicting and inconsistent mandates among agencies at different levels, and the difficulty of ensuring that local government regulators and other agencies effectively implement national policies. The need to clarify responsibilities and develop mechanisms to improve accountability and oversight is a recurring theme.

Background information and documents


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