What Are the Changes in China’s Economic and Trade Regulations Starting from 2021?

[Asia Economy Reporter Hwang Yoon-joo] With the implementation of 28 newly enacted and revised Chinese economic and trade-related laws starting this year, significant changes are expected, prompting calls for Korean companies to prepare in advance.

The Korea International Trade Association's Beijing branch, in collaboration with the Chinese law firm Jingdu (Jingdu), published the report "Major Changes in China's Economic and Trade Regulations in 2021" on the 10th. The report highlighted key regulatory changes this year, including ▲ the enforcement of the Civil Code ▲ strengthened consumer protection ▲ enhanced environmental management ▲ reinforced intellectual property rights protection ▲ and the legalization of previously incomplete systems.

First, China's first-ever "Civil Code" came into effect on January 1. The Civil Code consists of seven parts and supplementary provisions totaling 1,260 articles, covering general principles, property rights, contracts, personality rights, marriage and family, inheritance, and tort liability. It actively reflects social changes, such as formally recognizing digital documents, including online contracts, as written forms. Notably, it introduces for the first time a system for mental damages compensation for personality rights infringement, specifying that if one party's breach causes serious mental harm by damaging the other party's personality rights, claims for breach of contract and mental damages can be made.

A new "Cosmetics Supervision and Administration Regulation" aimed at strengthening consumer goods quality control also took effect on January 1. This regulation contains over 80 articles, more than twice the number in the previous "Cosmetics Hygiene Supervision Regulation," establishing more detailed and stringent management rules. Imported cosmetics must provide certification documents related to the production quality control of overseas manufacturers and proof of product origin and sales in the market during registration and reporting. If it is difficult to submit origin documents because the products are manufactured for export to China, relevant research and experimental data conducted targeting Chinese consumers must be provided.

China is also actively advancing environmental protection. The "Notice on the Comprehensive Ban on the Import of Solid Waste," enacted last year, has been enforced since January 1, banning all types of solid waste imports and restricting the removal of solid waste generated in bonded zones outside those zones. This year, vehicle purchase tax exemptions will be granted for electric vehicles, plug-in hybrid electric vehicles (PHEVs), and fuel cell vehicles.

Efforts to expand imports and open the market continue. From January 1, provisional import tariffs lower than the most-favored-nation rates have been applied to 883 items (based on HS 8-digit codes), including anticancer drugs, hearing aids, and fuel cell circulation pumps. Additionally, from July 1, tariffs on 176 information and communication technology (IT) products will be further reduced.

Meanwhile, following the COVID-19 pandemic, the importance of biosafety has been emphasized in China. The "Biosafety Law" will be enforced from April 15, elevating biosafety management to a national security level. Unauthorized importation of alien species will result in confiscation and fines ranging from 50,000 to 250,000 yuan.

Starting June 1, amendments to the "Patent Law" and "Copyright Law," closely related to intellectual property issues central to the US-China trade dispute, will take effect. The revised Patent Law extends the protection period for utility models from 10 to 15 years and introduces punitive damages, significantly increasing the maximum statutory compensation from 10,000?1,000,000 yuan to 30,000?5,000,000 yuan. The definition of works protected under the Copyright Law has been expanded from "films or film-like works" to "audiovisual works," thereby extending protection to online live broadcasts, online games, short clips, animations, and more in line with contemporary changes.

This content was produced with the assistance of AI translation services.