Environmental Technologies Industries

Environmental Technologies Industries

Market Plans

China Environmental Export Market Plan

Chapter 3 - Legal and Policy Review

Prior to the 1970s, few administrative measures were promulgated to facilitate the administration of water and soil conservation, forestation, health and safety in the workplace, or urban beautification, and no clear environmental protection goals, laws, or policies existed in China. This remained the case until after the Chinese government attended the 1972 United Nations Conference on the Human Environment (UNCHE) in Stockholm, which is regarded not only as a milestone in the development of international environmental protection but also as a turning point in the development of environmental protection in China. In 1973, the first National Environmental Protection Meeting was held in Beijing. Following the meeting the State Council promulgated its Guidelines on Environmental Protection and its Rules on Environmental Protection and Improvement, which are regarded as China's first environmental policies. At that time, these policies filled the role of the environmental protection law promulgated on a trial basis six years later. Since then, environmental protection has gained increasing prominence on the government agenda.

Following the first National Environmental Protection Meeting of 1973, the Environmental Protection Committee of the State Council was established in 1974, culminating in the development of a national-level environmental protection administration. Under this organization, several environmental protection regulations, as well as standards on pollution discharge and quality of municipal drinking water and food, were enacted between 1974 and 1978.

In 1978, the Constitution of the People's Republic of China was amended to include Article 11, marking for the first time an inclusion of environmental protection therein and providing a constitutional basis toward those means. The "trial" Environmental Protection Law of China was then promulgated in 1979, stipulating many of the basic components of environmental protection in China today. In 1989, the Environmental Protection Law of the PRC was promulgated, replacing the trial law of 1979. By the end of 2000, six laws, around 100 administrative regulations, and over 1,000 local regulations had been promulgated by the National People's Congress (NPC), the State Council, various ministries, and provincial and municipal governments.

Legal Framework of Environmental Protection

Laws and Regulations

China's legal system for environmental protection is based on a broad framework (at the constitutional level) that is filled in by laws and regulations stipulated by incrementally lower levels of law-making bodies.

The Constitution

Article 11 of the Constitution, promulgated in 1978, initially gave a constitutional basis to the protection of the environment. Since the article's promulgation, the Constitution has undergone further reform, strengthening commitment to environmental protection. Nonetheless, the constitutional commitment to the environment is general, serving only as a base of legitimacy for the further development of environmental laws and regulations.

Basic Law

The basic, or general, laws are those laws formulated by the NPC and its Standing Committee, and they rank second to the Constitution in terms of authority. These laws are more pointed than the components of the Constitution that support environmental protection, but they remain general in comparison with the regulations devised to carry out their directives. Currently, six such laws have been promulgated with regard to environmental protection. They are
1. the Environmental Protection Law of the PRC,
2. the Marine Environmental Protection Law of the PRC,
3. the Water Pollution Prevention and Control Law of the PRC,
4. the Air Pollution Prevention and Control Law of the PRC,
5. the Solid Waste Management Law of the PRC, and
6. the Environmental Noise Pollution Prevention and Control Law of the PRC.

Regulations

Administrative regulations of the State Council serve to implement the basic laws promulgated by the NPC and its Standing Committee. Basic laws rank higher in authority than regulations; however, regulations are more numerous, specific, and instrumental than basic laws. There are many regulations for environmental protection, including, for example, the Administrative Regulations for Environmental Protection of Construction Projects, the Implementation Details of the Water Pollution Prevention and Control Law of the PRC, and the Implementation Details of the Air Pollution Prevention and Control Law of the PRC.

Ministerial administrative regulations rank next in the authoritative hierarchy, and again they exceed their superiors in number. SEPA is the major source of ministerial regulations with regard to environmental protection. Several other ministries and commissions, such as SDPC and SETC, issue them as well.

The People's Congresses at the provincial and municipal levels, as well as other local government bodies, issue local regulations limited in authority to their respective localities. It is at this point that China's legal structure becomes most specific. Local regulations, and thereby local implementation of national laws, can vary from locality to locality.

International Treaties

International treaties are a final component of China's environmental legal system. China is signatory to 73 international treaties particular to environmental protection, 50 of which are multilateral and 23 bilateral.

Leading Principles of Environmental Protection Laws and Regulations

Four legal principles define China's environmental protection goals and serve as the broad guidelines of environmental protection legislation:

1. Harmonious Development stipulates that environmental protection must parallel economic and social development, so as to achieve economic, social, and environmental benefits in unison. Its ultimate goal is the realization of sustainable development, and it is interpreted by the law in that environmental protection must be incorporated into all social and economic development planning.
2. Stressing Prevention While Strengthening Control places the emphasis of environmental protection on pollution prevention but recognizes that in most cases gradual improvements in pollution abatement efforts are all that can be expected.
3. The Polluter Pays principle seeks to impose the costs of environmental degradation on those who are responsible for that degradation. In practice, these costs are imposed directly upon Chinese enterprises, in the form of pollution levies, and only indirectly upon consumers, in the form of higher prices.
4. Public Participation is, theoretically, sought out in China's environmental protection legal apparatus. In many cases, the capacity for the public to influence environmental protection remains limited by the same factors that affect its impact on other public spheres, and public participation is largely excluded from the policy development process. However, many environmental protection bureaus (EPBs) at the municipal level accept and process public input and complaints in regard to environmental degradation. Administrators are realizing that encouraging public voicing of dissatisfaction (within "the bounds of the law") may help to justify increased spending on environmental protection, and citizens are increasingly encouraged to support environmental protection.

National Measures Toward Environmental Planning and Protection

The following is a broad-based description of the processes and measures through which national-level environmental protection is constituted and carried out. Although the environmental legal system in China is increasingly comprehensive and rationalized, it remains complex and in certain cases contradictory. Additionally, laws and regulations are sometimes revised and promulgated quite rapidly.

Environmental protection planning establishes environmental protection targets and the measures needed to meet those targets. Local EPBs conduct preliminary surveys and establish plans that are then submitted to SEPA for national-level review and incorporation into the national Five Year Plans. The process takes years and requires repeated confirmation, evaluation, consulting, and coordination.

The plan targets set for the year 2000 included the following:

The development of a relatively well organized environmental management and legal system appropriate to the socialist market economy
The placing of environmental pollution and ecological damage "largely under control"
The facilitation of environmental improvement for some cities and regions
The establishment of a number of demonstration cities and regions whose economies are in rapid development and whose environments and ecology are in sound condition

The plan for 2010 includes the following targets:

A "fairly well implemented" sustainable development strategy
The further establishment of an environmental legal system
A "largely changed" situation of environmental pollution and ecological deterioration
Sharply improved environmental quality
The achievement, within a "large number of cities and regions," of rapidly developing economies with sound ecological and environmental conditions

Although the plan targets appear to be vague, general, and in some cases overly idealistic, they serve a fundamental purpose in setting goals to be achieved through the administrative capacities of lower-level governments.

Environmental Planning During the Ninth Five Year Plan

Goals for the Ninth Five Year Plan sought to keep the year 2000 discharge rates of many pollutants near or below 1995 levels while increasing overall economic and productivity growth. Table 3.1 lists the official 1995 statistics for 21 major pollution categories and the corresponding goals for the year 2000.

A number of programs, such as the One Control and Two Targets (Yi Kong Shuang Da Biao in Chinese), the 3321 Campaign, and the China Trans-century Green Engineering Program, have been established to facilitate the implementation of the plan.

Table 3.1 1995 Pollution Figures and Year 2000 Targets

*Category of Pollutant*	*1995 Levels*	*Target Levels for 2000*
Total soot emission (10,000 tons)	1,744	1,750
Industrial dust discharge (10,000 tons)	1,731	1,700
Sulfur dioxide emissions (10,000 tons)	2,370	2,460
Chemical oxygen demand (10,000 tons)	2,233	2,200
Oil pollutant discharge (tons)	84,370	83,100
Cyanide discharge (tons)	3,495	3,273
Arsenic discharge (tons)	1,446	1,376
Mercury discharge (tons)	27	26
Lead discharge (tons)	1,700	1,670
Cadmium discharge (tons)	285	270
Hexivalent chromium discharge (tons)	670	618
Industrial solid waste (10,000 tons)	6,170	5,995
Wastewater discharge (100 million tons)	356	480
Industrial wastewater discharge (100 million tons)	222.5	300
Treatment rate of industrial wastewater (percent)	76.8	74
Treatment rate of urban sewage (percent)	19	25
Treatment rate of industrial waste gases	74	80
Comprehensive utilization rate of industrial solid wastes	40	45
Decontamination rate of urban refuse (percent)	43	50
Forest coverage (percent)	13.92	15.5
Nature reserve area (10,000 hectares)	7,185	10,000

Note: The amounts of wastewater and industrial wastewater discharged and the treatment rates in 1995 do not cover township enterprises.
Source: Ninth Five Year Plan for Environmental Protection and Year 2010 Long-Term Goals (Beijing: SEPA, 1996).

One Control and Two Targets. One Control and Two Targets is intended to control pollution in terms of total emissions, thereby controlling discharge concentration at point sources of pollution and improving air and water quality. "One control" refers to the total emissions of a particular polluting discharge allowed nationwide. Under the plan, the total allotment for each pollutant is to be divided among the provinces, and then further divided within the provinces, all the way down to local EPBs and ultimately to each enterprise. Older facilities, which are usually state-owned, are generally given higher allocations for discharge, while newer facilities are seen as more capable of reducing overall discharge levels.

The "two targets" are to bring Chinese industries within local and national standards regarding all industrial pollutants and to improve air and water quality in municipalities, provincial capital cities, special economic zones, coastal development cities, and major tourist cities. In 1997, SEPA issued the Ninth Five Year Plan "total emissions control" (TEC) standards for 12 major pollutants (see Table 3.2). Enterprises unable to meet the requirements of One Control and Two Targets face closure.

Box 5. Public Participation
A number of recent public opinion polls carried out by private market research companies, research centers, and other interest groups have found that environmental issues are registering as top concerns of Chinese citizens. In a 2000 survey in 10 cities around the country, about half of the respondents selected environmental protection as their top concern, ahead of issues such as unemployment, corruption, and economic growth. A 2001 survey found a similar number of people ranking environmental issues over population growth and an underdeveloped education system.

In accordance with Article 11 of the Environmental Protection Law, SEPA and provincial EPBs have been issuing national or provincial environmental reports on a regular basis since 1989. The reports, which cover water, marine, air, noise, industrial solid waste, radiation, land and cultivated land, forest and grassland, biodiversity, climate change, and other related issues, also provide statistical data and information on major environmental protection activities. The purpose of the reports is to arouse public concern, instigate a degree of pressure on polluters and local governments, and drum up citizen support, interest, and even supervision over environmental issues. The regularity of these reports varies from locale to locale, with some cities reporting on some subjects daily. Prior to these allowances, such information was not made public.

To further facilitate public participation in environmental protection, SEPA issued a notice on establishing separate offices at both SEPA and local EPBs to review and respond to citizen complaints in December 1990. According to this and further regulations, such complaints must be responded to within 30 or 90 days, depending upon the intricacies of the issue at hand. If citizens are dissatisfied with the solution proposed by an EPB, they are entitled to refer the issue to higher-level EPBs or to the courts for reexamination. Citizens dissatisfied with a solution proposed by SEPA may refer the issue to the courts.

Official figures indicate that among 238,000 enterprises affected by the One Control and Two Targets program nationwide, 90 percent reached the targets by the end of 2000. Among those that did not reach the targets, 520 "key enterprises" identified by SETC were granted a grace period extending to Dec. 31, 2002. Those enterprises not identified by SETC as "key" will face strict measures formulated by their local governments, including requisite ceasing of production or closings. There is reason to believe that the figure of 90 percent is not entirely accurate, and issues of reversion raise questions regarding whether all enterprises that met the standards by the deadline are still operating within them.

Table 3.2 Pollutants Selected for Total Emissions Control

*Category of Pollutant*	*1995 Levels*	*Target Levels for 2000*	*2000 vs.1995 (percent)*
Total soot emission (10,000 tons)	1,744	1,750	0.37
Industrial dust discharge (10,000 tons)	1,731	1,700	21.80
Sulfur dioxide emissions (10,000 tons)	2,370	2,460	3.82
Chemical oxygen demand (10,000 tons)	2,233	2,200	21.49
Oil pollutant discharge (tons)	84,370	83,100	21.5
Cyanide discharge (tons)	3,495	3,273	26.4
Arsenic discharge (tons)	1,446	1,376	24.8
Mercury discharge (tons)	27	26	23.7
Lead discharge (tons)	1,700	1,670	21.9
Cadmium discharge (tons)	285	270	25.4
Hexivalent chromium discharge (tons)	670	618	27.7
Industrial solid waste (10,000 tons)	6,170	5,995	22.9

Source: National Total Pollution Control Scheme for the Ninth Five Year Plan (Beijing: SEPA, 1997).

The 3-3-2-1 Campaign. The 3-3-2-1 Campaign refers to the following targets, which have been selected as key pollution prevention and control zones: three rivers (the Huaihe, the Liaohe, and the Haihe); three lakes (Taihu, Chaohu, and Dianchi); two zones (an acid rain control zone and an SO2 control zone); and one municipality (Beijing). Most of these targets exist in or are affected by several provinces, thus making strong cooperation among provincial governments necessary. Each was selected because of serious pollution issues.

The acid rain control zone and SO2 control zone total 1.09 million square kilometers in area, which amounts to 11.4 percent of China's total territory. Within this, the acid rain control zone covers about 133 cities and counties in Shanghai, Jiangsu, Zhejiang, Anhui, Fujian, Jiangxi, Hubei, Hunan, Guangdong, Guangxi, Chongqing, Sichuan, Guizhou, and Yunnan. The total area reaches 0.8 million square kilometers, amounting to 8.4 percent of the total Chinese territory. The SO2 control zone covers about 125 cities and counties in Beijing, Tianjin, Hebei, Shaanxi, Inner Mongolia, Liaoning, Jilin, Jiangsu, Shandong, Henan, Shanxi, Gansu, Ningxia, and Xinjiang. The total area reaches 0.29 million square kilometers, amounting to 3 percent of the total territory. These regions constitute the most troublesome sources of SO2 and acid rain; therefore more stringent measures are being taken in them to address the problems.

The Trans-century Green Engineering Program. Initiated as part of the Ninth Five Year Plan for Environmental Protection, and under the auspices of Agenda 21, the Trans-century Green Engineering Program is composed of a series of environmental protection projects implemented in key locations and provided for through enhanced financial resources. The program's aim is to focus limited financial resources and manpower on serious pollution issues to bring environmental and ecological deterioration under control. The project has three phases, corresponding with the Ninth, Tenth, and Eleventh Five-Year Plans.

Table 3.3 Trans-century Green Engineering Program Project Distribution

*Contents of Control*	*Number of Projects*	*Remarks*
1. Control of water pollution in seven major river basins	650	A total of 801 projects for prevention and control of water pollution
Huaihe basin	282
Liaohe basin	30
Haihe basin	56
Songhua River basin	44
Yellow River basin	69
Pearl River basin	36
Yangtze River basin	133
2. Control of water pollution in three major lakes	35
Dianchi	13
Chaohu	7
Taihu	15
3. Control of water pollution in major coastal cities	99
4. Control of water pollution in other cities	17
5. Major acid rain pollution control regions	109
East China	9
Central China	36
South China	28
Southwest China	36
6. Control of air pollution in major cities	219
7. Control of solid waste pollution	272	A total of 328 projects for prevention and control of air pollution
Industrial solid wastes	118
Hazardous waste and radioactive waste	85
Disposal of municipal waste	69
8. Ecological environmental protection	118
Ecological environmental protection and restoration	54
Rural ecological protection	37
Preservation of nature reserves	27
9. Actions related to global environmental issues	69
Greenhouse gas control	28
Ozone layer protection	14
Biodiversity conservation	27
10. Capacity building of national environmental supervision and administration	3
Total	1,591

Source: The China Trans-century Green Engineering Program (Beijing: SEPA, 1996).

Agenda 21. China's Agenda 21 is a direct result of the 1992 United Nations Conference on Environment and Development in Rio de Janeiro, and it was in fact the first national-level Agenda 21 formulated in the world. The program is now regarded as the country's blueprint for sustainable development and environmental protection. Agenda 21's primary focuses include capping industrial pollution at 1995 levels while maintaining rapid industrial growth; increasing pollution levies so as to equal or exceed waste-treatment costs; increasing and improving the use of market-based and financial tools for environmental protection; promoting clean production; and developing a large-scale plan for environmental protection known as the Trans-century Green Engineering Program.

The Center for Environmentally Sound Technology Transfer. The Center for Environmentally Sound Technology Transfer (CESTT) was established in 1997 with the intention of further developing China's Agenda 21. With support from the Ministry of Science and Technology, technical assistance via the Asian Development Bank, and under the direction of the administrative center for Agenda 21, CESTT assists small and medium-sized enterprises with accessing, developing, and applying environmentally sound technologies.

The Tenth Five Year Plan for Environmental Protection

SEPA completed its draft of the Tenth National Five Year Plan for Environmental Protection (2001-2005), which was incorporated into the Tenth National Five Year Plan for Economic and Social Development (the Tenth Five Year Plan) in March 2001. The plan stipulates environmental targets for the end of 2005, which are characteristically general in nature. They include the further establishment of environmental protection policy, law, and administrative systems appropriate to a socialist market economic system; a reduction in the tendency toward environmental pollution and ecological deterioration; the improvement of environmental quality in key cities and regions; and an increase in the number of cities and regions in which economic development is rapid while environmental and ecological conditions remain sound.

Tasks for the Tenth Five Year Plan include the following:

To continue total emission control and maintain a continuous decline in total pollution discharge
To direct economic restructuring toward the promotion of clean production
To promote municipal sustainable development focusing on the improvement of environmental quality
To emphasize ecological protection and pollution prevention and control equally
To launch a "three zone" ecological protection strategy to include special ecological function zones, key resource development zones, and ecologically sound zones
To strengthen environmental protection enforcement in rural areas and to control rural environmental pollution effectively
To develop the domestic environmental industry and to maintain an effective supply of environmental technologies and products
To strengthen the management of nuclear environmental safety and prevent and control radiation-associated issues actively
To accelerate the modernization of environmental management in the energy industry
To protect national environmental safety and participate actively in international environmental initiatives

In augmentation of the 3321 Campaign of the Ninth Five Year Plan, key regions identified in the tenth plan will include the Yangtze River, the Yellow River, and the Bohai sea; the number of key cities for pollution control is to be expanded from 47 to 100.

Environmental Protection Standards

By the end of 1999, 426 environmental standards had been established throughout China, classified as national environmental standards, SEPA environmental standards, and local environmental standards. SEPA is in charge of the establishment of national environmental standards and SEPA environmental standards, both of which are in use nationwide. SEPA environmental standards function for categories for which national standards are not available. Once equivalent national environmental standards are formulated, SEPA environmental standards automatically become invalid.

National environmental standards include the following:

National environmental quality standards, which regulate the concentration of toxic substances in a given environment and serve as the basis for other environmental standards
National emissions standards, which regulate the concentration of pollutants discharged into a given environment
National environmental monitoring methods standards, which regulate techniques and methods used in sampling, testing, analyzing, and processing data collected for monitoring environmental quality and emissions
National environmental sampling standards, which are used for preparing solutions, adjusting and collating analysis and testing equipment, and regulating other aspects of sampling and analysis
National environmental basic standards, which standardize items such as technical terms, symbols, abbreviations, graphics, and data indexes used in the environmental protection field

When no national environmental quality standards or national emissions standards are available for a particular category, provincial governments may formulate local standards; provincial governments may also set more stringent standards than the equivalent national emissions standards. Local standards must be submitted to SEPA for record keeping.

Three Simultaneous Steps

The Three Simultaneous Steps policy stipulates that all environmental protection facilities must be designed, constructed, and operated simultaneously with the main construction project, as opposed to designing, building, and operating a facility with the intention of retrofitting the project with an environmental protection plan and facility at some stage after its completion. The Three Simultaneous Steps policy applies to all new, expansion, and renovation projects. For treatment facilities, the measure is generally applied to those components that are being expanded or renovated; however, it may apply to an entire facility once any portion is added, modified, or upgraded.

The three steps for treatment facilities can be summarized as follows:
1. Design: The engineering design institution must ensure that the pollution measures recommended in the environmental impact assessment (EIA) and required under the Three Simultaneous Steps measure are included in the facility design. Technically, this process involves receiving approval from the same environmental regulatory entity that approved the project's initial EIA report (SEPA, the provincial EPB, or the local EPB, contingent on the scale of the project). In reality it is often synonymous with registering the project.
2. Construction: The construction of environmental facilities must meet the requirements as specified in the EIA and should be undertaken simultaneously with the main construction component.
3. Operation: Upon completion of construction, a trial operation period commences. Following the trial operation period, a thorough inspection of the technical, financial, health, safety, and environmental aspects of the completed project is implemented.

If a facility fails the inspection, the EPB requires upgrading and a further inspection within a specified time period.

Environmental Impact Assessment

The EIA concept was first introduced to China in the Environmental Protection Law of 1979. Beginning in the mid-1980s, the government began requiring EIAs for large-scale projects. The program has since developed steadily, incorporating the experiences of other countries with local practices and constraints and resulting in a system that in many ways is beginning to resemble EIA programs elsewhere. The Administrative Regulations for Environmental Protection of Construction Projects (1990) and the Technical Guidelines for Environmental Impact Assessment (1993) are key pieces of legislation strengthening the country's EIA program. Other laws, such as the Marine Environmental Protection Law, the Water Pollution Prevention and Control Law, and the Air Pollution Prevention and Control Law, include EIA requirements.

The scope of EIAs is presently restricted to construction projects, including expansion and renovation projects, and does not include major long-term planning, policy, or regional development considerations. A revised EIA law is currently undergoing review and, when promulgated, will reportedly require performance of the EIA at an earlier stage of the project approval process, increasingly comprehensive methods and protocols, cost-benefit analysis, fines for non-compliances, and legal liabilities.

Regulatory guidelines such as the Administrative Regulations for Environmental Protection of Construction Projects, the National Technical Guidelines for Environmental Impact Assessment, and the Administrative Provisions for the Inspection and Approval of Completed Environmental Protection Facilities of Construction Projects (1993) regulate the EIA process. The most recent EIA regulation is the 1998 Management Protocol. Significantly, the State Council itself issued this document, while the other regulations listed above were issued by SEPA. The 1998 Management Protocol is a detailed implementation document backed by the authority of the premier's office and is relatively well enforced. It includes existing over-all policy goals such as mass loading targets and use of clean technology and provides greater detail on the regulation of EIAs and environmental facility construction, including specification of non-compliance fines.

Clean Production

The state encourages the adoption of clean production to reduce air and water pollution and the accumulation of solid waste. The SETC is authorized, in conjunction with other ministries, to list for elimination certain "backward" production techniques and technologies known to cause heavy air and water pollution or to result in the creation of significant amounts of solid waste. The production, sale, and use of the listed techniques and technologies are illegal. Similarly, SETC publishes listings of clean production technologies and techniques, the use of which is encouraged.

Emissions Registration and Emissions License

Emissions registration requires enterprises constituting a pollution source to register with local EPBs in regard to those pollutants being legally discharged. The purpose of the registration is to facilitate comprehensive accounting by local EPBs regarding emissions under their jurisdiction. Registration also enables further administrative action toward pollution prevention and control, monitoring, supervision, and compilation of statistics. Local EPBs have the right to inspect facilities to verify the information provided by registered enterprises.

Emissions registration must be filed with local EPBs following the inspection and approval of pollution prevention and control facilities and prior to official commencement of operation. The scope of registration includes type, quantity, and concentration of emissions, receptacle of emission discharge, process of emissions discharge, type of noise pollution sources, strength of noise pollution, general conditions of pollution prevention and control facilities, and general conditions of storage, utilization, and disposal facilities for solid and other types of waste.

If there are any significant changes to the registered items during the operation of a facility, including the removal or disuse of the facility, the enterprise must file an amending registration with the original EPB 15 days prior to the change. Enterprises ceasing operations must inform the original EPB. If emissions do not meet relevant national or local standards, enterprises must specify why and adopt measures to meet the standards.

In addition to registering, the enterprise must submit an emissions license application to the local EPB. Upon successful application, an emissions license will be issued to the enterprise to serve as legal permission for the discharge of specified pollutants. This regulation does not apply to radioactive waste, which is subject to separate and more rigorous requirements.

Emissions Fees

Emissions fees are levied on enterprises discharging pollutants in excess of state standards. Under new air and water laws, all emissions, even those not exceeding state standards, receive levies, with heavier levies, legal liabilities, and potential closure looming for those enterprises exceeding state standards. Local EPBs or their authorized monitoring institutions survey factors such as the type, quantity, and concentration of pollutants to determine the exact amount of the emissions fee, in accordance with pertinent regulations.

Revenues collected via the emissions fee system are generally recycled into the environmental protection apparatus by servicing loans and grants for upgrading enterprises (as much as 80 percent of the fees paid by an enterprise can be returned to the enterprise to finance environmental upgrades), augmenting EPB budgets, and financing pollution treatment and the restoration of polluted environments. The fees do not, however, exempt enterprises from legal liabilities, compensation for personal injury or property losses, or other financial burdens associated with further pollution prevention and control measures.

The major weakness of the Chinese emissions fee system is that levies remain too low to provide an incentive for pollution control. Some enterprises find it more cost-effective to submit emissions fees than to develop or operate costly pollution control facilities or take other measures to prevent and control emissions. Additionally, local EPBs often prefer to maintain emissions fees at the current lower level rather than increase them and provide a stronger incentive to improve pollution control, because 20 percent of all collected emissions fees are used to augment EPB budgets; there has been recent discussion, however, regarding the elimination of this practice. There is also discussion of transforming the current emissions fee system into a more efficient and better-regulated taxation system, but such a change is not expected during the Tenth Five Year Plan.

Coal consumption, which remains the principal energy source in China, reached 1.28 billion tons in 1995, and SO2 emissions resulting from coal burning reached 23.7 million tons, ranking as the world's highest. In early 1992, to tackle the problem, SEPA together with a number of other ministries and supported by the State Council initiated a trial SO2 emissions fee for coal burning in industrial sectors. Guizhou Province, Guangdong Province, and nine cities in other provinces were selected for the trial. Based on the experiences in these locales, the practice was expanded, eventually covering the entire acid rain control zone and SO2 control zone by Jan. 1, 1998. Unlike most other emissions fees, the SO2 emissions fee is collected regardless of whether the emissions exceeded standards; any emission of SO2 requires a fee, whereas the exceeding of standards constitutes a basis for heavier enforcement measures.

Environmental Monitoring

Under the Environmental Protection Law, monitoring systems must be established to conduct environmental monitoring in China. National and local monitoring stations are classified into four levels (national, provincial, municipal, and county) and are encompassed in a three-level monitoring network (national, provincial, and municipal). National monitoring stations are operated under SEPA, and local-level monitoring stations are operated under the relevant EPBs. Additionally, specialized environmental monitoring networks have been established for major river systems, marine areas, and agricultural environments. Every monitoring station must write monthly and yearly reports, as well as any other report requested by upper-level stations or superiors, and submit them to the directly superior monitoring station for inclusion in a more comprehensive report. Some large cities now provide daily environmental reports, made public via local media.

On-the-Spot Inspection

Both SEPA and local EPBs conduct on-the-spot inspections of pollution sources to supervise the implementation and enforcement of all requirements stipulated by the relevant laws and regulations. Supervision departments are established within both SEPA and local EPBs to conduct such inspections, levy fines for violations of laws and regulations, and collect emissions fees. Enterprises under inspection have expressed concern regarding the confidentiality of trade and enterprise secrets that may be discovered during the inspection process. Under the Tentative Procedures on Environmental Protection Supervision, inspectors are required to maintain confidentiality in regard to such secrets.

Abatement Deadlines

Enterprises discharging pollutants in excess of relevant emissions standards over an extended period of time, as well as pollution sources located in or near natural reserves, historic sites, scenic spots, or other locations under special protection, may be required to carry out pollution control measures within a prescribed period. The directive to impose an "abatement deadline" can be handed down only by local governments, not by EPBs. However, EPBs are responsible for impact assessments, action plan evaluations, and implementation supervision.

When considering the imposition of an abatement deadline, authorities take into account the seriousness of the pollution. If discharges in excess of standards do not cause serious pollution, enterprises may simply be required to pay heavier emissions fees. There are no detailed stipulations specifying what constitutes serious pollution; however, in practice, the following factors are generally considered when deciding upon the issue:

Whether the total volume of the pollutants discharged continuously exceeds relevant emission standards
Whether multiple types of pollutants are discharged, many of which do not easily degrade in nature
Whether discharged pollutants and discharge rates constitute a threat to public health
Whether discharged pollutants have become a public nuisance and have instigated dispute

Facilities located in or near natural reserves, historic sites, scenic spots, or other locations under special protection are less subject to flexibility based upon the seriousness of the pollution and are more likely to receive an abatement deadline as opposed to increased levies. In cases where adequate financial resources and technical capacity are unavailable, enterprises are generally shut down instead of receiving an abatement deadline. The time limits for abatement deadlines generally range from one to five years.

Accident Reporting

Environmental pollution accidents must be followed by measures to control the pollution, inform nearby communities that may be affected, and report to local EPBs. After an accident is reported, local EPBs must report to local governments regarding further pollution control and emergency response measures. Local EPBs must also conduct on-the-spot investigations and collect pertinent information to be applied to further prevention and control measures. Accidents are graded into four levels based on their seriousness; level three accidents must be reported to provincial EPBs, and level four accidents must be reported to SEPA.

Incentives

Incentives such as tax deductions and waivers, special funds, and honorable awards and certifications, as well as certain disincentives, have been established both nationally and locally to encourage improved environmental protection. Several examples of such incentives and disincentives are introduced below.

Import Tax and Value-Added Import Tax Waiver. In an effort to accelerate foreign investment and promote the import of advanced technologies and equipment, import tax and value-added import tax on some pollution prevention and control products may be waived.
Income Tax Waiver. Enterprises using certain industrial waste products as major raw materials for new products may have their income tax on the sales of such products waived for five years.
Adjustment Tax on Investment in Fixed Assets Waiver. Enterprises investing in fixed assets for the reuse of the "three wastes" (air, water, and solid wastes) may have their adjustment tax on investment in fixed assets waived.
Value-Added Tax Waiver. Enterprises using coal gangue, stone coal, coal ash, and certain other items as raw materials to produce building materials may have their value-added tax waived provided that the recycled products constitute no less than 30 percent of the raw materials in the production process. Enterprises using wastewater and solid waste to process gold and silver may have their value-added tax waived.
Ban on Bank Loans for Outdated Products and Technologies. The SETC provides listings of outdated products and technologies that are heavily polluting or not energy efficient. Commercial banks bear legal liabilities for providing loans to facilities for the production or utilization of these listed items.
"Excellence in Environmental Protection Technology."
Environmental protection technologies meeting a number of criteria may be considered for SEPA's "Excellence in Environmental Protection Technology" title. SEPA awards the title on a yearly basis, and local EPBs are charged with the popularization of the technologies. Enterprises must give priority to the utilization of these technologies if feasible; otherwise, their EIA or application for financial assistance will not be approved.
Environmental Protection Certification. SEPA and provincial EPBs confer environmental protection certification on environmental protection equipment and facilities that are deemed suitable. SEPA issues, on an irregular basis, lists of equipment and facilities that are considered important in environmental protection and must acquire such certification. When conducting new, expansion, and renovation projects, enterprises must use certified equipment and facilities. The conferment is valid for three years and is renewable.
Environmental Labeling. In order to qualify for environmental labeling, a product must uphold environmental protection requirements throughout its life cycle, from production to consumption to disposal. Environmental labeling not only increases a product's competitiveness but also provides consumers with an opportunity to support environmental protection by purchasing such products. Environmental labels are valid for three years and may be renewed upon reevaluation.

Main Regulators of Environmental Protection

The National People's Congress

The National People's Congress is the country's highest legislative body and holds exclusive authority in enacting, amending, and interpreting the Constitution of China, as well as all laws and policies pertinent to major aspects of national social and economic development. Additionally, the NPC supervises the implementation of laws and policies and determines appointments to positions of central government leadership and the Supreme People's Court and Supreme People's Procuratorate. About 3,000 representatives from the provinces, municipalities, and autonomous regions are elected to the Congress every five years and convene in Beijing once a year. The Standing Committee of the National People's Congress is the working organization of the Congress and maintains its authority and responsibility while the Congress is not in session.

Local people's congresses, which are maintained at the provincial, municipal, county, and township levels, constitute the local regulatory bodies, are in charge of local legislative issues, and determine the appointment of local government leaders. No standing congress committees are maintained at the township level.

The Environmental and Resources Protection Commission, a subsidiary organization of the Standing Committee of the National People's Congress, is the highest authority in charge of drafting laws and regulations pertinent to environmental and natural resources protection and supports the National People's Congress in overseeing the implementation of relevant legislation. The commission has three divisions: the general affairs department, the legislation department, and the research department. Mr. Qu Geping, chairman of the commission, is currently a central player in regard to Chinese environmental law and policy.

The State Council

The State Council is the central government body charged with the implementation of all laws and policies and has authority over all sectors of national social and economic development. It is comprised of a premier, vice premiers, state councilors, ministers, a general secretary, and vice general secretaries. Leadership positions are filled by appointment and are approved by the National People's Congress every five years. The State Council formulates administrative regulations and policies based upon the Constitution and laws of China and maintains the leadership role over all levels of local government.

In 1998, a large-scale restructuring of the State Council and its subsidiary ministries and commissions was carried out, followed one year later by the restructuring of all local governments. The restructuring was aimed at increasing government regulatory and administrative roles and decreasing government roles in specific business issues. Additionally, it was intended to reduce the bureaucracy and financial burdens that have long been a serious barrier to the development of the country. As a result of the restructuring, the number of subsidiary organizations under the State Council has decreased from 40 to 29.

Under the leadership of the State Council, provincial and lower-level local governments function very much like the State Council in regard to local social and economic affairs. They must report to both the local people's congress and the government body operating at the next-highest level of administration.

Ministries and Commissions Influencing Environmental Protection

The following ministries and commissions influence the environmental protection sector and administer environmental protection measures within their official jurisdictions on a daily basis. Like most other ministries in China, they are structured vertically, from the national level to the county and even the township level. Local bodies report to both the local government and their upper-level counterparts.

The State Environmental Protection Administration (SEPA). The State Environmental Protection Administration is the highest strictly environmental administrative authority in China. Its responsibilities include the drafting of laws, the issuing of regulations and standards, the analysis and reporting of environmental indicators, the supervision of nationwide environmental legislation enforcement, and the development of pollution prevention policy and planning. In setting environmental protection targets and developing plans to meet those targets, SEPA works in collaboration with the Ministry of Construction, SDPC, and SETC, among others, and is responsible for overseeing the implementation and coordination of those targets in cooperation with the relevant institution and agencies.

As part of the 1998 government restructuring plan, SEPA was elevated to the ministry level, representing a theoretical strengthening of its authority. SEPA did relinquish much of its control over planning and policy for the environmental industry to SETC but is expected to increase its role in determining national policy and objectives. Nonetheless, a perceived conflict of interest between environmental protection and economic development remains among the ministries, and SEPA's lesser authority and financial capacity in comparison with the likes of SETC and SDPC remains something of a sticking point.

SEPA's vertical authoritative structure is also troublesome in that local governments exercise control over most administrative details within local EPBs. EPB financing, personnel, daily administration, and so forth are managed by local governments, while SEPA establishes broad operative goals and administrative directives. As a result, local governments have more leverage to see that EPBs act in accordance with local government interests as opposed to state-level SEPA directives. The administrative details of SEPA's operations are a constant topic of policy-making discussion, and further changes in administration, and possibly even structure, are to be expected.

The State Development and Planning Commission (SDPC). The State Development and Planning Commission develops medium- and long-term social and economic development plans (thereby defining the fundamental development goals for the country) and supervises the implementation of those plans. Thus, SDPC exerts influence upon all social and economic sectors, including the environmental field.

SDPC responsibilities include researching and advising on the formulation of state economic and social development strategies with an aim toward maintaining a development balance and structural optimization; planning for resource development, energy distribution, and ecological and environmental protection infrastructure development; gathering and analyzing development and economic indicators for the financial and banking sectors; and proposing allocations of public investment funds and foreign capital funds.

The SDPC maintains significant influence over specific projects in order to coordinate overall investment in various sectors of the economy. However, following government restructuring, the commission, like all ministries, is intended to assume a more regulatory and administrative role, becoming less involved in the determination and approval of specific projects and, from a macroeconomic planning position, assuming an increased role in encouraging investment and development by domestic and foreign institutions and companies. At the same time, the State Council appears to be increasing the relative authority of the State Economic and Trade Commission while slowly diminishing the authority of SDPC, which is viewed as a legacy of China's former planned economy.

The State Economic and Trade Commission (SETC). The State Economic and Trade Commission is the most powerful regulator of daily national economic operations, particularly in regard to industrial aspects. The SETC influences most economic sectors directly or indirectly through implementing and supervising economic and social development plans. It is also responsible for supervising and analyzing national economic trends, adjusting daily economic operations, establishing short-term economic operational goals, policies, and measures, and carrying out international cooperation efforts.

Additionally, SETC oversees the drafting and implementation of state industrial policies, plans investment layout for competitive industries, drafts policy for reforming state-owned enterprises, promotes enterprise development, oversees project investment and financing, oversees resource use and application, and coordinates environmental protection and the development of environmental industry.

The Ministry of Finance. The Ministry of Finance is the primary organization under the State Council charged with issues pertinent to state revenues and expenditures, financial policies, and taxation policies (in conjunction with the State Taxation Administration). The Ministry of Finance, independently or in cooperation with other government organizations, formulates, implements, and supervises laws, regulations, strategies, policies, and planning pertinent to financial and taxation issues; conducts administration over the state's annual budget and expenditures, including the formulation and implementation of plans for the expenditure of state revenue, arrangements for state project investment, government purchase planning and policies, special financial accounts, and government foundations; conducts administration over state debts, including the planning and issuance of state debts, as well as relevant policies; conducts administration over the accounting and auditing sectors; conducts administration over international loans via foreign governments, the World Bank, the Asian Development Bank, and other such institutions; conducts administration over the taxation of foreign-related operations, such as the taxation of imports and exports; and carries out planning pertinent to financial research, education, and training.

The Ministry of Foreign Trade and Economic Cooperation (MOFTEC). The Ministry of Foreign Trade and Economic Cooperation's primary function is the formulation and implementation of policies, laws, and regulations concerning foreign trade and economic cooperation, which includes analysis of international trade and economic climates and their impact on China, approval and issuance of international trade and business licenses, and regulation of the import-export markets. MOFTEC is also the main government channel for bilateral finance cooperation and plays a key role in the approval process for foreign investment.

The Ministry of Construction. The Ministry of Construction formulates regulations, policies, and planning with regard to municipal and township design and construction, the building industry, the residential housing industry, architectural designing and consultancy, and the municipal public works industry. Additionally, the ministry's responsibilities include, in cooperation with other ministries, the formulation of construction standards, construction budgets, and feasibility studies. Many aspects of infrastructure development, including transportation, energy, communications, water treatment and supply, and waste management, are directly or partially under the auspices of the Ministry of Construction.

The Ministry of Science and Technology. The Ministry of Science and Technology formulates policies, strategies, regulations, and planning with regard to the development of science and technology. Planning for and promotion of scientific and high-tech research, as well as the facilitation of financing for scientific and technological research, are included in its responsibilities. The ministry also plays a role in facilitating international cooperation in scientific advancement.

The Ministry of Science and Technology maintains an innovation fund for small technology-based firms, which is the only ministry-furnished support fund at least partially directed toward environmental protection. Aimed at facilitating the transformation of scientific research achievements into technological innovations to benefit economic growth, the fund is gaining in repute and capacity.

The Ministry of Land Resources. The Ministry of Land Resources regulates natural resource administration and is responsible for the protection and rational utilization of land, mineral, marine (except fishery), and other natural resources, as well as the supervision and pollution prevention of groundwater resources. The ministry also develops technology standards, procedures, and solutions for land, mineral, and marine resource use; drafts and implements general and specific land application plans; and participates in preliminary city planning.

The protection of landowners' and land users' legal rights and the investigation and resolution of land ownership and land use disputes fall under the jurisdiction of the Ministry of Land Resources, as does the development of international cooperation on land, mineral, and sea resources.

The Ministry of Communications. The Ministry of Communications formulates and implements strategies, policies, and regulations with regard to land and water transportation and shipping. The ministry is charged with the maintenance of the public roads, highways, and related facilities and fee collections. Similarly, the development and maintenance of the water transportation and shipping infrastructure and the collection of related fees fall within the ministry's jurisdiction. The Ministry of Communications also supervises water transport and shipping safety, the inspection of ships and marine facilities, the prevention and control of pollution caused by ships, and ocean emergency response.

The Ministry of Water Resources. The Ministry of Water Resources' responsibilities entail the formulation and implementation of regulations, policies, and plans with regard to water resources and efficient water use. Water quality inspections, investment and management plans, pricing, taxation, and administration of national water and soil conservation, as well as flood and drought prevention, are included.

The State Forestry Administration. The State Forestry Administration formulates and implements regulations, policies, and development plans regarding forestry and ecological conservation. Its responsibilities include administration of the state forestation fund, forestation operations, soil erosion and desertification alleviation, surveying and monitoring of national forest resources, and the approval and supervision of forest resource utilization. Additionally, its jurisdiction enters the realm of biodiversity and endangered species. Administration over the protection and management of wild plant and animal species, including endangered plants and animals, is included. International trade in both endangered and non-endangered plant and animal species, international treaties in regard to such species, and other international treaties relevant to the State Forestry Administration are included among its responsibilities.

The Ministry of Agriculture. The Ministry of Agriculture formulates and implements development strategies, policies, and regulations with regard to agricultural development. Additionally, it coordinates with relevant ministries to promote sustainable agriculture, sustainable utilization and protection of fisheries, and protection for aquatic life, grasslands, and wetlands. Supervision of fertilizer quality, animal husbandry, and medicinal treatment of livestock is also carried out, in collaboration with other affiliated ministries.

Township and village enterprises fall under the jurisdiction of the Ministry of Agriculture. Industrial enterprises within this category are significant contributors to environmental pollution but generally remain outside of the environmental protection apparatus. The few environmental statistics available on township and village industrial enterprises are compiled by the Ministry of Agriculture.

The State Taxation Administration. Taxation policies and procedures, including the development of favorable taxation policies to promote environmental protection, and import-export taxation with and without regard to environmental technologies and related incentive policies, all fall within the jurisdiction of the State Taxation Administration. There has been some discussion, as noted above, regarding the possibility of transforming pollution levies into environmental protection taxes and shifting the jurisdiction over such funds to the relatively authoritative and administratively better organized State Taxation Administration.

Major Environmental Protection Laws

The Environmental Protection Law of the PRC

The Chinese government did not include environmental protection in the Constitution of the PRC until 1978, when it stipulated that the state protect and improve the ecological environment, remedy pollution and other public hazards, guarantee reasonable use of natural resources, and protect rare animals and plants. The 1978 alteration of the Constitution became the foundation of detailed environmental legislation. The NPC established the Environmental Protection Law on a trial basis in September 1979. The State Council further announced in 1983 that environmental protection was to become a strategic task in the process of modernizing China. Environmental protection was raised to the rank of national policy, second in importance only to family planning. However, environmental protection was not integrated systematically into politics, causing some policies to have contradictory impacts on the state of the environment. An example was the household responsibility contract system, which stated that the right to use land belonged to farmers, while the state was owner of the land and rural collectives were in charge of public interests. The Environmental Protection Law of the PRC, effective on Dec. 26, 1989, helped to consolidate environmental directives in a more systematic way.

The Marine Environmental Protection Law of the PRC

The Marine Environmental Protection law defines the respective roles of SEPA, the State Oceanic Administration, the State Maritime Affairs Administration (under the Ministry of Communications), the State Fishery Bureau (under the Ministry of Agriculture), and military environmental protection organizations with regard to marine environmental protection. SEPA is the central coordinator and supervisor of marine environmental protection, and oversees prevention and control of oceanic pollution caused by onshore sources.

The law stipulates that measures to protect, restore, and preserve marine ecological systems and historic natural sites and landscapes must be taken. Natural marine reserves at the local and national level must be set up. Emergency response plans for marine pollution accidents, offshore oil leakages, and enterprise-related pollution issues are to be formulated, and implementation is carried out in accordance with such plans in case of accidents. Pollution discharges from onshore sources to ocean areas must be evaluated and approved by local EPBs, in consultation with local oceanic bureaus, maritime affairs bureaus, fishery bureaus, and military environmental protection organizations. Such facilities are not to be located within or in proximity to marine natural reserves, major fishery zones, coastal scenic spots, and other localities under special protection. Provisions and guidelines for EIAs related to both onshore and off-shore marine-impacting construction, production, discharging, and so forth are outlined in the law.

Dumping standards and relevant evaluation procedures are the jurisdiction of the State Oceanic Administration. The State Maritime Affairs Administration has authority to enact compulsory measures to prevent and control pollution associated with maritime transport and shipping facilities and has authority regarding accidents associated with such facilities within PRC maritime territory.

The Water Pollution Prevention and Control Law of the PRC

SEPA and local EPBs are in charge of the general administration of water pollution prevention and control. Organizations under the Ministry of Communications, charged with the administration of inland water and ocean transportation, have authority over water pollution caused by ships. The Ministry of Water Resources, the Ministry of Public Health, the Ministry of Land Resources, municipal public works bureaus, and water resources bureaus coordinate with SEPA and local EPBs regarding water pollution protection and control.

Regarding river protection, SEPA, in conjunction with other relevant government organizations, is charged with drafting pollution prevention and control plans for the major state-designated rivers. Based on these plans, provincial EPBs and other local government organizations draft pollution prevention and control plans for their respective sections of transprovincial and transcounty rivers. The plans are submitted to the State Council or provincial governments for approval.

Local-level governments must incorporate the protection of municipal water resources, and pollution prevention and control, into municipal development plans. Focus is to be placed on the construction and improvement of water distribution and sewage systems and municipal wastewater facilities.

Groundwater protection zones for drinking water are to be designated by provincial governments. The zones are separated into graded levels, the most strict of which disallows any wastewater discharge, tourism activities, swimming and other such activities, and new construction projects or expansion projects for non-water distribution or non-water protection purposes. Any facility producing emissions within such a zone must be removed or undergo abatement measures.

The Air Pollution Prevention and Control Law of the PRC

The Air Pollution Prevention and Control Law of the PRC outlines the incorporation of air pollution prevention and control into the state economic and social development plan. Total emissions control standards, air quality standards, and air emissions standards are established. Guidelines for the supervision and implementation of laws and regulations, comprehensive utilizations, scientific research on air pollution prevention and control, forestation, and municipal beautification are contained herein.

The most recently amended version of the law provides more stringent guidelines in regard to emissions control, thereby making it illegal to exceed relevant national and local emissions standards. Previously, enterprises exceeding such standards were made to pay levies; under the new law such enterprises will be fined, abatement deadlines may be imposed, and closures are possible.

The law also authorizes the State Council and SEPA to designate the following special regions for the implementation of more stringent measures:

Acid rain control and SO2 control zones
Total emissions control zones for air emissions
Key air pollution prevention and control cities (the number of which is mandated to rise to 100 during the Tenth Five Year Plan).

Crude lump coal containing high SO2 and soot concentrations must undergo a washing process before use. The sale of coal-burning devices unable to meet relevant emissions standards is banned. Newly designed urban structures depending on coal for fuel must include central heating facilities. Fireproof and dust-proof coal storage facilities are requisite.

The manufacture, sale, and importation of automobiles and ships failing to meet relevant emissions standards are banned. Provincial governments, when issuing new emissions standards for automobiles and ships, must get approval from the State Council. Provincial EPBs can authorize organizations to conduct air emissions checks for automobiles and ships, and local EPBs can conduct random examinations of automobile emissions systems in parking lots.

Industrial enterprises discharging dust must take relevant preventive and control measures. Flammable gases must be reutilized if the relevant facilities are available; otherwise, gases must be processed to reduce pollutants prior to discharge. Measures to reduce sulfur, synthetic ammonia, and coal gas must be taken where applicable. Measures to control dust must be taken at construction sites.

In keeping with China's commitment to the Montreal Protocol, measures to encourage the production and utilization of substitutes for ozone-depleting substances will be taken by central and local governments with the intention of phasing out the use of all ozone-depleting substances.

The Solid Waste Management Law of the PRC

SEPA is charged with the general administration of solid waste management nationwide. Other ministries coordinate with SEPA and conduct administration of solid waste management within their official jurisdictions, and local EPBs and government bodies fill their respective roles on a local basis. The Ministry of Construction and local municipal public works bureaus are in charge of the administration of collecting, sorting, processing, storing, transporting, and disposing of municipal solid waste.

Stipulations aim to minimize the production of solid waste, promote its reutilization, and, wherever possible, mitigate its harmful capacities. To do this, the state encourages and supports clean production, comprehensive resource utilization, scientific and technological research and development, and popularization of technologies suited to solid waste management.

To prevent and appropriately manage industrial solid waste, SETC in concert with other ministries must research, develop, and popularize techniques and equipment aimed at reducing the production of solid waste. Additionally, lists of "backward" techniques and equipment are published, and the production, sale, and use of such items are outlawed.

The Environmental Noise Pollution Prevention and Control Law of the PRC

The Environmental Noise Pollution Prevention and Control Law of the PRC charges government bodies with the establishment and enforcement of environmental noise pollution standards. The law includes provisions for the prevention and control of industrial noise pollution, construction noise pollution, traffic noise pollution, and noise pollution caused by social activities. In the cases of industrial and construction noise pollution, measures must be taken to reduce or dampen noise, and time frames are to be established to further regulate the allowance of varying levels of noise. In the case of traffic-caused noise pollution, all motor vehicles, including water vessels navigating inland bodies of water and railline locomotives, are to employ sound-dampening apparatus and restrict the use of horns and sirens within the limits of the law. It is required that sound-dampening barriers be built in instances where traffic-related or other sources of noise pollution cannot be brought within the limits of the law.

Environmental Protection Policies for Western Development

The Chinese government has defined five key priorities for the development of the poorer western regions. However, the development strategy is dichotomous in the sense that industrial and infrastructure development are being strongly pushed while at the same time environmental protection and sustainable development will be maintained.

The potential for this development drive to cause problems for the already desertified and polluted western areas is significant. Most western provinces suffer severe water shortages, and Lanzhou, the capital of Gansu Province, is among the world's most polluted cities.

Industry is the foremost contributor to western pollution. In comparison with industries in eastern and southern cities, western industries are outdated, inefficient, and highly polluting. In addition, as coastal regions attempt to clean up polluting factories by shutting them down or charging steep fines, these same industries are pushed to the west, where pollution regulation and enforcement are more difficult. The hope is that greater investment brings more efficiency to the region and that closer government attention eliminates the frontier-like attitudes that have so far contributed to its deterioration.

The government places a high priority on environmental protection, investing large amounts in tree- and grass-planting schemes to stabilize soil and water resources. However, the western population consists mostly of rural farmers, among whom are China's poorest. Many of these people depend on farming as their primary source of income and on forest resources for cooking and heating. Most of their practices of irrigation, agriculture, and forest resource use are highly inefficient and have a heavy impact. Tree felling for fuel contributes to massive desertification, poorly managed irrigation leads to salinization and inefficient water use, and improper use of fertilizer and pesticides causes untold non-point-source environmental complications. It remains to be seen how the agricultural sector will be "restructured" so that the members of the local population may retain their livelihood and in fact better their practices.

The most pressing concern for the time being is the lack of water. Serious droughts afflict the region each year, and water management is practically unheard-of. Unsustainable farming practices have taken root, and multilateral irrigation projects have not been successful outside of project bounds. If western development goes as planned, the demand for water will soar. The government's solution - to divert water from the Yellow River - could have disastrous effects on regions of southeastern China.

Legal Trends in the Environmental Field

As a result of amendments to the Air Pollution Prevention and Control Law, governments at all levels must now include measures for atmospheric protection in all economic and social development plans. Similarly, the awaited environmental impact assessment law will likely require EIAs to be included in the formulation of such plans. Thus, a more comprehensive approach to environmental monitoring and protection is developing within the legislation itself. At the same time, legal bases are being developed to promote and support cleaner production, emissions trading, and market-based incentives, and a growing recognition of the need for legislation regarding the comprehensive utilization of natural resources exists. Finally, a definitive shift from concentration-related regulations and end-of-pipe pollution control to a holistic approach to pollution control (manifested in TEC) is undoubtedly taking place.

Environmental Impact Assessment (EIA) Law

Major issues expected to be addressed by this new law include expanding the activities that require an EIA to include the formulation of laws, the formulation and implementation of national economic and social development planning, and the formulation and implementaion of economic and technological policies; conducting EIAs at an earlier stage of the approval process; carrying out post-EIAs to regulate activities with a potentially serious impact on the environment; and providing for public disclosure of EIAs.

Cleaner Production Law

SETC is the leading authority regarding clean production and the Cleaner Production Law, which may have implications for new investment and facility upgrades. The latest draft (issued in July 2000) includes procedures concerning the formulation of clean production standards, requires that evaluations of clean production be incorporated into EIAs, established efforts for the promotion of clean production, and sets legal liabilities for violations of the law. The draft also provides for the identification of enterprises with large production potential but severe pollution problems and allows for special measures to assist such enterprises in the development of cleaner production. In the meantime, pilot activities have been carried out in several industries, among them petrochemicals and chemicals, steel and iron, and light industries in Beijing, Tianjin, Shenyang, Taiyuan, Jinan, Fuyang, Lanzhou, Shanghai, Chongqing, and Kunming.

Water Pollution Law

The amended Water Pollution Law presently being discussed by the State Council will most likely facilitate proper exploitation, effective use, and unified management of water resources with particular emphasis on water shortage, water pollution, and flood prevention projects. It is also expected that the Water Pollution Law will be revised according to the same principles as the Air Pollution Law; however, details have not yet been published.

Selected References and Web Sites

References

Gan Shijun and Chen Yuxiang, eds., Sustainable Development A Trans-Century Decision (Beijing: Chinese Communist Party Training School Publishing House, 1997).

Li Zhou and Sun Yanmei, Environmental Issues In China (Henan: Henan People's Publishing House, 2001).

State Environmental Protection Administration, China Environmental Protection Agenda 21 (Beijing: China Environmental Science Publishing House, 1995).

State Environmental Protection Administration, China Environmental Protection Laws and Regulations Collection, Volume 1-4, (Beijing: Xueyuan Publishing House, 1997, 2000, 2001).

State Environmental Protection Administration, International Environmental Conventions and Treaties Collection China Entered (Beijing: Xueyuan Publishing House, 1999).

State Environmental Protection Administration, Local Environmental Protection Regulations Collection (Beijing: Xueyuan Publishing House, 1999).

Wang, Jin, The Principles of Chinese Environmental Law (Beijing: Beijing University Publishing House, 2000).

Web Sites

People's Republic of China, State Economic and Trade Commission (Chinese only):
www.setc.gov.cn/

People's Republic of China, State Development Planning Commission (Chinese only):
www.sdpc.gov.cn/

People's Republic of China, State Economic and Trade Commission (Chinese only):
www.setc.gov.cn/bwlj/setc_bwlj.htm

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