BEIJING, June 6 -- China will roll out vigorous efforts to build a more comprehensive and rigorous social credit system to improve its business environment and boost development, the State Council decided at an executive meeting chaired by Premier Li Keqiang on Wednesday.
Key priorities for improving the social credit system were identified at the meeting. These measures include building a social credit-centered regulatory mechanism and enhancing social credit building in key areas concerning people's livelihood.
Premier Li Keqiang said that a social credit system comprising solid credit records of all market entities, is of fundamental importance.
Recent years have seen China make visible progress in developing a national social credit system. A unified social credit code has been introduced nationwide. A total of 33.99 million credit codes have been issued to newly registered businesses. And 71 central government departments and provincial governments have been connected to the national credit information sharing platform. The cross-sectoral, inter-agency mechanism of incentives and disincentives for acts of good or bad faith made initial impacts. Big data has been applied in credit investigation and helped businesses meet real needs.
For example, companies with good credit records had received 632,000 loans from financial institutions in the banking sector by the end of 2017.
"Breakthroughs have been made in developing the social credit system. Going forward, the system needs to be improved in key areas in response to specific needs," Li said at the Wednesday meeting. "The priority now is to improve our business environment with stronger measures against cheating in marketplace, such as counterfeiting, and infringements of intellectual property rights."
Steps in the following five aspects were decided at the meeting to enhance the building of a social credit system with application of the system and legislation on prioritized. A credit-centered regulatory system will be set up to improve the business environment. Blacklist mechanism will be introduced. Law violations including infringement, counterfeiting and cheating in marketplace and fraudulent advertising will be resolutely tackled and made public.
Information safety need to be safeguarded, and trade secrets and individual privacy should be well protected. Also, a social credit system in key livelihood areas will be enhanced.
Non-public sector will be guided in building the social credit system, and credit information services provided by third parties will be developed. Government departments will be required to bolster credibility, and problems of new officials disavowing obligations undertaken by predecessors will be tackled under the law.
It was also decided at the meeting that government requirements on certification will be overhauled to make it easier for the general public and enterprises to get things done.
The practice of inspections by randomly selected inspectors against randomly selected entities and prompt release of inspection results will be fully implemented to make market regulation fairer and more efficient. These above measures will all contribute to the building of the social credit system.
"A market economy is based on credit," Premier Li said. "A fine credit system provides market entities with the information they need for business operations. A blacklist should be established. Access to and sharing of information, which can serve to incentivize or discipline, helps reduce transaction costs and improve the business environment."
Premier Li also emphasized the importance of safeguarding information security with tiered authorization. He called for early establishment of a secure and reliable social credit system and introduction of capable third parties in the financial sector.
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