China mulls decoupling asset evaluation industry, regulators

BEIJING - Chinese lawmakers on Monday began to mull a draft law requiring independence of asset evaluation industry associations from government regulators.

The draft law, submitted for its third reading at the bimonthly session of the Standing Committee of the National People's Congress (NPC), said regulators should not have personnel or financial connections with industry associations, nor can they feed asset appraising agencies with business orders.

The rule was added to the draft after previous reading. The current version also provided that there should be national associations for various sectors of asset evaluation, and local associations if needed. Government regulators are responsible for setting rules to manage these associations.

The previous draft said only registered asset appraisers can practice; however, the State Council has already rescinded entrance permits into the industry and turned to managing appraisers through a performance rating system, according to a report from the NPC's Law Committee, citing opinions from government departments and industry associations.

Therefore, the current draft deleted requirements for registration, and clarified that the country manages professional appraisers with a performance rating system.

The draft law deals with the management of asset appraisers, the obligation and rights of evaluation institutions, supervision over the appraisal industry, and penalties for violations.

The draft law also aims to facilitate coordination among government departments to better regulate the industry.