China - Economic Law Reform Project

Docamt of The World Bank Report No. T-6393-CHA TECENICAL ANNEX CHNA EC0NONIIC LAWl REFOR PROJECT SEPTEMBER 20, 1994  I  CHINA: ECONOMIC LAW REFORM PROJECT TECHNICAL ANNEX Section A: Detailed Project Description Project Obiectives and Overview 1. The Project would support China's economic law reform by: (a) assisting in the preparation of economic legislation in priority areas; (b) enhancing training methods and curricula for law teachers, legal practitioners and legal, judicial and other personnel in government departments in the theory and practice of the new legal framework; and (c) strengthening the key legal institutions responsible for legislation and implementation of economic laws. Project assistance in the first two areas, legislation and training, would be provided through support of a program of sub-projects in each area. Institutional support would be provided directly to the National People's Congress (NPC) Commission on Legislative Affairs (CLA), which is responsible for reviewing all laws submitted to the NPC for consistency and technical drafting, as well as for the development of the legal profession (lawyers' examination and continuing legal education) and for the development of legal information systems. Sub-projects would have no equally suitable financing available from UNDP or other external financing agencies. LeQislative sub-projects 2. Sub-projects under the legislative component would support the preparation of laws (and their supplementary regulations and implementing rules) included in the NPC five-year (1993-98) legislative agenda, which would assist in the development of a market economy (about 54 laws are considered in this category). Each sub-project would consist of a package of assistance, designed to provide comparative legal experiences and advice on legislative drafting in a specific field of law. Each package would include as necessary: acquisition and translation of materials (particularly foreign laws and regulations); employment of international and local legal experts to advise on drafting outline and detailed provisions; seminars to discuss initial directions and subsequent drafts; and short, focussed study tours by drafting group members to investigate specific issues arising in the drafting process. Sub-projects could assist all stages of the drafting process, from analysis of need, initial drafting, revisions and final debate and review, as appropriate in each area, and all relevant levels of the legislative process (line agency, State Council, NPC) would be expected to benefit from the assistance so as to develop common understandings during the course of the drafting process. 3. An initial set of seven legislative sub-projects has been prepared by the implementing agencies in consultation with the Ministry of Finance, as Project Coordinating Agency, and appraised by and agreed with the Association. Proposed credit allocations, subject to final adjustment, are shown below. Subsequent sub-projects would be proposed by the implementing agency concerned and, if approved by the Project Coordinating Agency in consultation with the core legislative agencies, recommended to IDA for its agreement. The initial set of  -2- sub-projects are described in paragraphs 4 to 11 below. An indicative list of other potential sub-projects is given in paragraph 12. 4. NPC Commission on LeQislative Affairs (CLA). (Sub-project cost estimate: $530,000; Credit financing $320,000). Assistance would be provided to CLA in preparation of legislation in two major areas: unification of contract law (economic contract law, foreign economic contract law and technology contracts); and property law. The unification of the existing contract laws has been recommended for some time, and is a high priority in the legislative program. Work on the contract law has already begun and is expected to take some time, in view of the broad task involved. The need for better legal regulation of property rights (includinq quarantees) is also well-established. The property law is being considered as a separate law, since a comprehensive civil code is not even in the legislative agenda ending in 1998. Civil law and financial law expertise will be required to make best use of comparative practice in this area. 5. NPC Economic and Finance Committee (EFC). (Sub-project cost estimate: $980,000; Credit financing $700,000). Assistance would be provided to EFC in the preparation of legislation in five of the ten areas of legislation for which EFC has drafting responsibility under the NPC five-year plan; there are many other laws for which EFC has review responsibility. The areas are: bankruptcy law, futures market law, state property law, partnership enterprise law, sole enterprise law and basic tax law. In view of the already considerable expertise in the area of foreign exchange, an EFC request for assistance in the drafting of the regulations on foreign exchange has been deferred for later consideration. 6. The current bankruDtcv law applies only to state enterprises; bankruptcy procedures for other enterprises have a minimal footing in civil procedure provisions. A revised bankruptcy law, applying one set of modern bankruptcy rules to all enterprises regardless of ownership, would be an important step forward. The legal rights and responsibilities for the use, transfer and disposition of state-owned assets are also in urgent need of definition. While work on futures market legislation is advanced, compatibility with external markets and procedures heightens the need for foreign comparative assistance. The two enterprise laws, partnership and sole proprietorship, would help to complete the range of organizational options under the new legal system, now that the company law has come into force. There would be some scope for combining comparative interventions in these two areas, however, as expertise and issues were likely to have substantial overlap. The basic tax law which EFC is drafting will be a tax law of general principles, which will be coordinated with the five free standing specialized tax laws for which MOF has requested assistance (see para. 10 below). 7. State Economic and Trade Commission (SETC). (Sub-project cost estimate: $170,000; Credit financing $100,000). Assistance would be provided to SETC in the drafting of the anti-monovolv law, which is under SETC leadership with a drafting group comprising SETC officials and those from the State Administration of Industry and Commerce (SAIC). There is a need to explore not only developed country models of anti-monopoly law and practice (eg., the U.S. and EC), but also the experience of other transition economies in tailoring anti-monopoly provisions to their economic circumstances. The possibility of establishing a  - 3 - national Fair Trade Commission is also under consideration. 8. State Commission for the Restructuring of the Economic System (SCRES). (Sub-project cost estimate: $87,000; Credit financing $75,000) Assistance would be provided to SCRES in the preparation of the shareholding cooperative enterprise law. The proposed shareholdinc cooperative enterprise law is an attempt to address an existing phenomenon and offer legal definition and control. Some study of cooperative laws of other countries would be useful, although it will also be important to utilize corporate legal experts to ensure that the resulting form of organization is compatible and can fairly compete with entities under the company law and other laws. 9. Ministry of Justice (MOJ). (Sub-project cost estimate: $190,000; Credit financing $140,000) Assistance would be provided to MOJ for revisions of the lawyers' law, which was drafted before the great changes taking place in Chinese legal practice in the last year, and for the preparation of implementing rules and standards. Implementing legislation, necessary to carry out the stipulations of the law, will include: Implementing Rules for the Law of the People's Republic of China on Lawyers, Standards for Lawyers' Professional Ethics and Discipline, Lawyers' rules, and Lawyers' compensation provisions. In all of these areas, comparison with legal practice in other jurisdictions would be essential in designing a new system for China's legal profession. 10. Ministry of Finance (MOF). (Sub-project cost estimate: $420,000; Credit financing $300,000) Assistance would be provided to MOF's Legal Department for the drafting of 6 items of legislation: the state debt law and five free- standing tax laws (enterprise income tax, value-added tax, business tax, consumption tax and resource tax). The state debt law, being drafted in conjunction with MOF's Debt Management Department, will cover issuance, circulation and primary and secondary market regulation for state treasury bonds. The five tax laws, being drafted in conjunction with MOF's Tax Policy Department, will be coordinated with the basic tax law under preparation by EFC, and the tax policy components of the proposed Fiscal and Tax Reform Implementation Project. Assistance for tax law drafting should be able to take advantage of the interrelationships among tax laws, so that, for example, in inter-related areas, an expert visiting China or a study tour could cover several topics, and, of course, collection of materials could be comprehensive. 11. Ministry of Foreiqn Trade and Economic Cooperation (MOFTEC). (Sub-project cost estimate: $150,000; Credit financing $140,000) Now that the Foreign Trade Law has been enacted and come into force, MOFTEC is finalizing the necessary set of more than 10 implementing regulations on foreign trade, for issuance on an urgent basis. In addition to anti-dumping, countervailing duty and safeguard regulations which are well-advanced, assistance is also being provided for regulations to cover the administration of import and export of commodities and technology, issuance of import and export licenses and business licenses, among others. It is crucial that the provisions of these regulations meet international standards, such as GATT, to ensure China's entry into GATT and the world trade community. Therefore, outside expertise will be an essential element of the drafting process.  12. Other Potential Legislative Sub-proiects. Several items have been deferred for later consideration: CLA's proposal on administrative procedure law; EFC's proposal on foreicn exchange regulations; and SCRES' proposal on regulations for trading of property rights. Possible assistance to BLA in legislative drafting has also been deferred, as UNDP is currently considering BLA's request for further support. Moreover, it is the intent of the Project to ensure that BLA drafters are included, where possible, in the assistance to principal drafting agencies, rather than proposing an entirely separate exposure to comparative experience at the time of review of legislation. 13. The State Planning Commission (SPC) proposed assistance to the drafting of the fixed assets investment law. Further consideration needs to be given to whether any funding should be provided for this proposal to re-orient the law based on market principles. In addition, a MOFTEC proposal for study of conflicts of laws in Hong Kong and Macao has been deferred for later consideration. Training Sub-prolects 14. Sub-projects under the training component would provide support for key activities which would either: (a) have a broad impact on legal and other professionals teaching, training or implementing economic laws; or (L where the impact is more limited, demonstrate instead innovative approaches to meeting the changing needs of the legal profession and legal system in the market economy. Particular focus would be given to the development of new forms of teaching materials and training methods and to the development of legal information systems. Sub-projects would be expected to assist short-term needs in practical training of legal personnel as well as long-term strengthening of the legal training system, such as through curriculum development. Training sub-projects would be expected to address primarily in-country training and would not be limited to training at the national level in Beijing. 15. Three initial sub-projects have been prepared by the implementing agencies in consultation with MOF, as Project Coordinating Agency, and appraised by and agreed with the Association. Proposed credit allocations, subject to final adjustment, are shown below. Subsequent sub-projects would be proposed by the implementing agency concerned and, if approved by the Project Coordinating Agency after review by an expert panel, recommended to IDA for its agreement. The initial sub-projects are described in paragraphs 16-21 below. An indicative list of other potential sub-projects is given in paragraph 22. 16. Beiiing Lawyers Training Center. (Sub-project cost estimate: $720,000; Credit financing $500,000) The Beijing Lawyers Training Center is jointly funded by the Beijing Municipal Justice Bureau and the Beijing Lawyers Association, but its management is under the Lawyers Association. The sub-project would provide assistance in preparing and purchasing teaching materials, equipping audio- visual, simultaneous translation and other facilities, inviting foreign experts in selected topics and physical improvements (which would be entirely locally- funded). The course topics would include 10 core courses to be given over two years: company law (including relevant foreign law), intellectual property rights, financial markets laws, international investment, anti-dumping and anti-  - 5 - subsidy laws, international trade rules, legal profession and law firm management, bankruptcy, international commercial arbitration, and drafting of foreign legal documents. 17. The market for this training would be the more than 3,000 lawyers currently practicing law in Beijing. The Beijing Municipal Justice Bureau requires all lawyers to take about 160 hours per year of additional training in order to maintain their lawyers' licenses, as well as at least two training sessions (about 2 days each) in professional ethics. These requirements can be fulfilled at the Center, as well as by courses given elsewhere, such as MOJ's Senior Lawyers Training Center, universities and foreign language courses. 18. International Business Management Institute. (Sub-project cost estimate: $520,000; Credit financing $400,000) The International Business Management Institute (IBMI) is a national adult training institution of higher learning, established under the Ministry of Foreign Trade and Economic Cooperation (MOFTEC) in 1980. IBMI provides a variety of training programs in foreign trade-related matters to managers of foreign trade enterprises and state enterprises with foreign trading rights and to commercial counsellors in China's diplomatic service, and has a teaching staff of about 100, including full-time and part-time faculty. The sub-project would provide assistance to educate those foreign trade managers and officials in the newly-enacted Foreign Trade Law and the many regulations which will be issued under it. The proposed Foreign Trade Law course would also include subjects in international trade law which are essential for enterprise managers to export Chinese products and import foreign products efficiently, with a view towards China's entry into GATT. 19. The proposed course would be offered five times each year, and would cover about 5 or 6 topics, for about 50 students. Assistance would be required in purchasing and compiling teaching materials, training teachers, inviting foreign experts in international trade for some of the courses (and videotaping their lectures for use in other courses) and, to the extent required, specialized computer and audio-visual equipment needed for this course. 20. China National Lawyers Correspondence Training Center. (Sub-project cost estimate: $590,000; Credit financing: $470,000) The Center was established by MOJ in 1985 in Beijing to provide basic legal education and training to a wide range of people who do not have opportunities to receive a formal legal education but are interested in studying law. The Center has a broad impact in terms of the number of its students and the geographic areas covered by its training programs. Since 1985, a total of 400,000 people have received training from the Center, around 45,000 students are registered each year. The graduates of the Center receive the Da Zhuan (two-year college) diploma. The Center has established 30 central stations (one for each province) and 345 guidance stations under the Justice Bureau at regional/city level. Some of the stations are located in remote and poor areas or minority nationality areas, where no other forms of legal training are available. 21. The training program consists of 14 courses including philosophy, political economy, literature, legal philosophy, constitution, Chinese legal history, criminal law, criminal procedure, civil law, civil procedure, economic law,  - 6 - family law, international law, notary and lawyer systems. Training is provided through correspondence materials and audio-visual materials, and teachers make a circuit of the guidance stations to give lectures and answer questions. Financially, the Center is a self supported educational organization, which does not receive any budget from the government. Tuition which is currently charged at 260 RMB/person has been the major financial source of the Center. While only a portion of the Center's activities are related to economic laws, its unique function in making basic legal knowledge available to members of the general public as well as some in-service training for lawyers would merit Project support. 22. Other Potential Training Sub-prolects. Several other training sub-projects are under consideration, but proposals are not yet ready for review. These include: (a) Training in Fiscal Legislation for Local-level Officials: The MOF Legal Department has proposed specialized training of provincial and local government finance department/bureau officials in the newly-enacted fiscal laws. As this work would be undertaken by MOF's Training Institute, which already provides training for these officials in other subjects, preparation of a separate proposal for a training sub-project will require further internal discussion and coordination within MOF. A well-prepared proposal in this area would address the need for better implementation of law at the local level. (b) Legal Curriculum Development: The MOJ Education Department has requested assistance under the Project for the preparation of a modern law teaching curriculum, focussed on topics in economic law. MOJ is working with MOF to prepare a revised proposal focussing on the first set of books to be prepared. Possible topics for the first set include: international economic law, foreign-related economic law, negotiable instruments, company law, contract law, real estate law, bankruptcy law, securities law, insurance law and tax law. An interagency review committee is expected to be established to review draft texts, including those drafters of some of the new laws who had gained substantive knowledge of comparative legal principles and practice as well as pedagogic experts who could recommend new types of teaching methods (case studies, for example) to be followed. It would be consistent with the recommendations of the training needs assessment to expose the principal authors to new teaching methods before they begin preparation of the materials. (c) State Education Commission (SEdC): SEdC has proposed introducing a training program in economic law, to be offered at Beijing Law Faculty and Fudan Law Faculty in Shanghai. Further work is necessary to develop a proposal which addresses the management of the program, the respective roles of the SEdC and the law faculties, and the detailed planning and implementing of the training program itself. The list of topics proposed (including international trade and financial law, company law, tax laws, intellectual property law and real estate law) falls squarely within the objectives of the proposed Project, so that if a well-designed proposal could be prepared it would be eligible.  (d) Judicial Training Institute: Training for senior judges has been supported by other donors in the past. Preparations are in progress for the establishment of a new Judicial Training Institute. To the extent that other (grant) financing is not available, a proposal for assistance under the Project may be forthcoming. Institutional Support 23. The institutional support component would provide assistance to the CLA, BLA and MOJ. (a) CLA (Cost estimate $200,000): CLA has principal responsibility for reviewing all draft legislation submitted to the NPC and its Standing Committee, whether prepared at the NPC or by line agencies under BLA's supervision. Modernizing CLA's office technology to enable draft legislation to be revised, prepared and circulated quickly and efficiently, often under the pressure of legislative sessions, would be assisted through provision of office equipment, computers and printers. CLA's existing capacity for comparative law research would be strengthened by the addition of legal databases for countries of especial comparative relevance for the new laws under preparation. (b) BLA (Cost estimate: $620,000): BLA has developed its own Chinese law database, with support under the UNDP Legislative Drafting Project. This database includes NPC laws, State Council regulations, administrative rules of central ministries, and provincial regulations and administrative rules. To ensure effective coverage of legislation and to strengthen drafting capacity at the Ministerial and provincial level, the database would be extended through provision of workstations and network connections to 30 central departments and agencies; provincial level government legislative bureaus may also be included. Assistance to BLA in developing and maintaining the database and network would be provided. In the future, other entities such as law faculties and law firms could be provided access to this system, on a commercial basis. (c) MOJ (Cost estimate: under finalization): MOJ is undertaking a reform of the lawyers examination system, to upgrade the quality and consistency of testing. A new procedure for developing and using testing material is under study, as is a modernized testing administration. Assistance would be provided to provide comparative experience and technical support. Section B: Prolect Administration and Implementation Proiect Implementation Plan 24. A Project Implementation Plan was agreed with MOF during the appraisal.  - 8 - Its principal contents are set out below. 25. Project Coordinating Agency. The World Bank Department of MOF would be the overall Project Coordinating Agency, responsible for the day-to-day project coordinating work. This project coordination would be carried out by the Technical Assistance and Training Division, and would include: (a) sub-project Preparation and review--working with potential sub-project entities to plan and prepare sub-projects and reviewing sub-project proposals for consistency with Project objectives, eligibility criteria, internal consistency, relevance of content, reasonableness of cost estimates and cost-sharing arrangements and adequacy of implementation arrangements; (b) sub-project approval--consulting with IDA on draft sub-project proposals and furnishing final proposals as agreed by MOF to IDA for approval; (c) sub-project implementation- -assisting sub-project entities in applying Bank guidelines on procurement and disbursement to the hiring of foreign experts, procurement of equipment and materials, planning of study tours and organization of seminars; (d) sub-proiect monitoring--preparing (and furnishing to IDA) annual work plans and semi-annual Project progress reports, along with the semi-annual sub-project progress reports prepared by sub-project entities; preparing for the Project mid- term review; and assessing the impact of each sub-project upon completion and the impact of the Project as a whole in a Project Completion Report; (e~) overall Proiect implementation--assisting agencies under the institutional support component; preparing and presenting withdrawal requests to the Bank, managing the Special Account, maintaining Project accounts and records and ensuring their required annual audit; and convening periodic (at least semi- annual) meetings of the Legislative Advisory Group (see para. 27). MOF would employ a legal consultant in Beijing to assist in the preparation, review and supervision of sub-projects as outlined above, to be financed out of the proceeds of the Credit. Terms of reference and the selection process for the legal consultant were confirmed at negotiations. 26. The entity implementing each sub-project and the agencies under the institutional support component would be responsible for basic preparation and implementation. Semi-annual progress reports would be prepared and furnished by these entities to MOF for consolidation and comment. 27. Legislative Sub-project Approval Process. MOF would consult with other relevant agencies in the selection of sub-projects and review of their implementation. For legislative sub-projects, a Legislative Advisory Group would be constituted, inter alia, of senior representatives of the CLA and the EFC, BLA, and SCRES. MOF would convene meetings of the Legislative Advisory Group as needed, but at least every six months, at intervals which would allow input from this Group into the semi-annual progress reports and MOF's annual work plans. The participation of the Legislative Advisory Group would ensure that the  - 9 - legislative sub-projects met the eligibility criteria (para.2). During the annual work plan review (para. 29), MOF and IDA would agree on laws eligible for assistance in each year. Detailed sub-project proposals would be prepared as outlined in para. 25 and retained by MOF for review by IDA supervision mission. However, MOF would request IDA approval of legislative sub-projects using a simplified approval sheet. 28. Training Sub-project Approval Process. For training sub-projects, MOF would maintain a list agreed with the Bank of experts in legal education and training (including international and comparative expertise as needed), and would request at least three experts to review each training sub-project proposal. Selection of the three experts to review each proposal would depend on expertise and avoidance of any conflicts of interest. MOF would invite experts to be kept on a roster, under standard agreement on a timely review and on reasonable compensation on a per review basis. Fees for review by these experts would be eligible for financing under the Credit. Agreement on a roster and contractual arrangements were confirmed at negotiations. 29. Monitoring and Progress Reporting. Annual work plans would be prepared by MOF and furnished to IDA for discussion and concurrence. Each work plan would include: sub-projects under preparation (brief summary of content, tentative amount and status of preparation); sub-projects in implementation (listing of planned activities, by sub-project, with commentary); sub-projects scheduled for completion and evaluation. Work plans for 1994 and 1995 were agreed at negotiations; proposed work plans for each year thereafter would be provided to IDA for review and approval by October 31 of the preceding year. To aid in this process, MOF would require sub-project entities to provide sub-project work plans as part of sub-project proposals, updated in semi-annual sub-project progress reports. The information from these plans would be consolidated into the overall Project work plans prepared by MOF. 30. Semi-annual Project progress reports would be prepared based on sub-project progress reports and actual implementation experience, highlighting activities undertaken, disbursements, Project progress and implementation issues. Semi- annual Project progress reports (incorporating sub-project semi-annual progress reports) (para. 25) would be provided to IDA by March 1 and September 1 in each year. Key indicators for Project monitoring would be the preparation and eventual enactment of well-drafted and well-considered laws and regulations resulting from legislative sub-projects and the development of new training mechanisms and effective training courses resulting from training sub-projects. A mid-term review of Project progress and prospects would be jointly undertaken by MOP and IDA by December 31, 1996, and a Project Completion report would be prepared by MOF within six months after the Closing Date (June 30, 1999). The Project Completion Date is December 31, 1998. Agreement on a semi-annual Project progress report form and a model sub-project progress report form was confirmed at negotiations. 31. Supervision Arrangements. IDA staff (task manager, assisted by other staff and consultants with specialized expertise) responsibilities during the course of Project implementation would include: (a) review of draft and final sub-project proposals, providing comments and guidance on revisions;  - 10 - (b) approval of sub-project proposals and allocation of Credit funds, and advising MOF of approvals and allocations; (c) review and approval of annual work plans and review and comment on semi-annual Project progress reports; (d) participation in mid-term review; (e) providing guidance to sub-project entities on substantive aspects of sub-project implementation, including selection of experts, study tour destinations and review of legislation produced under sub-projects; and (f) undertaking semi-annual supervision missions in the spring and fall of each year to discuss progress (following receipt of semi- annual Progress report) in preparation and implementation of sub-projects and to reach agreement on annual work plans. IDA staff would also participate in a Project Launch Workshop, to be organized by MOF shortly after Credit effectiveness (fall 1994), to familiarize sub-project entities and potential sub- project entities with Project objectives and procedures. Proiect Administration 32. Proiect Cost and Financing Plan. The total Project cost is estimated at $13.3 million. The foreign cost is an estimated $10 million. The local cost is expected to be Y28.5 million ($3.3 million), not including taxes and duties, from which the Project, related imports and overseas consultants' fees and remuneration are exempt. The Project cost is based on the initial sub-project cost estimates and recent experience with other free-standing technical assistance projects in China. 33. The Project would be financed in part by a Development Credit of SDR 6.9 million ($10 million equivalent) on standard IDA terms with 35 years maturity. The Credit would finance the cost of foreign and local consultants, in-country training, overseas study tours and equipment for training and institutional support. Local financing of Y28.5 million (about $3.3 million), amounting to approximately 25% of Project costs, would be provided by the Government and implementing entities and agencies. Credit funds would be provided to implementing agencies on terms and conditions acceptable to the Association, which would include provision of Credit proceeds on a grant basis to agencies financed by the government budget. 34. Procurement. Goods (equipment and materials) would be procured through local shopping procedures (for contracts below $100,000 equivalent) and local competitive bidding procedures (for contracts between $100,000 and $200,000 equivalent). Proprietary teaching materials, books and journals would be procured directly from the supplier, under procedures satisfactory to the Association. Qualified international and local consultants would be engaged under the Bank's guidelines for the use of consultants. Contracts for goods over $200,000 would be subject to international competitive bidding procedures including preference for domestic manufacturers. All goods contracts over $200,000 would be subject to prior review as would the first three consultants' services contracts under each Sub-project and all other consultant contracts over $15,000 equivalent. 35. Disbursement. Disbursement would be made for: (a) goods, at 100% of foreign expenditures, 100t of local expenditures (ex-factory) and 75t of expenditures for other items procured locally; and (b) consultants' services,  - 11 - training and study tours, 100% of expenditures. A Special Account with an initial deposit of $900,000 would be established in a commercial bank, managed by MOF. Disbursement against contracts for goods not exceeding $100,000 equivalent and for consultants' services not exceeding $15,000 equivalent and for study tours would be made on the basis of statements of expenditure (SOEs). Retroactive financing of up to SDR 200,000 may be required for more urgent expenditures under pre-approved legislative sub-projects incurred after June 27, 1994. 36. Accounting and Audit Arrangements. The Project accounts and the Special Account would be maintained by MOF. The Project accounts, including the Special Account and the documentation for SOEs, would be subject to an annual audit by an independent auditor satisfactory to IDA, expected to be the Audit Administration of China. The audit report, including a separate opinion on SOEs and the Special Account, would be furnished to IDA within six months of the end of the Government's fiscal year.  - 12 - Annex 1 CHINA: ECONOMIC LAW REFORM PROJECT KEY PROJECT ACTIVITIES Government Project Component Expected Results Responsible Objectives Activities Agency LEGISLATIVE COMPONENT Utilize Acquisition and Finalized drafts of foreign translation of law for consideration experience in comparative legal by NPC, including: the use of materials Unified contract law CLA laws in a Property law CLA market Conducting policy State Assets Law EFC economy studies Futures Market Law EFC Revised Bankruptcy Compare Preparing and revising Law EFC Chinese and draft legislation Basic Tax Law EFC foreign legal Enterprise Laws EFC practice in Organizing workshops and State Debt Law EFC specific seminars to discuss Implementing Rules areas to legislation and of Foreign Trade Law MOFTEC assist comparative experience Share-holding drafting of Cooperative Law SCRES Chinese Undertaking study tours Anti-Monopoly Law SETC legislation to explore specific Lawyers Law MOJ issues arising in the Specific Tax Laws MOF drafting process TRAINING COMPONENT Upgrade Preparing and offering Better-trained Sub-project knowledge of training for lawyers and lawyers and others entities legal other professionals in involved in professionals new economic laws, implementing and in economic including company law, using new economic laws and financial markets laws, laws and commercial strengthen bankruptcy law, legal system legal international trade education and laws, and general Improved training for training commercial legal law students and framework faculty Designing new curriculum for training in selected topics of economic laws  - 13 - Government Project Component Expected Results Responsible Objectives Activities Agency INSTITUTIONAL SUPPORT COMPONENT Strengthen Acquisition of office Strengthened institu- CLA the key legal automation equipment and tional capacity in institutions comparative law processing, responsible databases production and for circulation of legislation legislative drafts and implementa- Connecting a legal Legal information BLA tion of information network network shared among economic laws central and provincial government agencies as well as law firms and academics Modernizing lawyers' Improved system for MOJ examination system qualifying lawyers;  - 14 - CHINA: ECONOMIC LAW REFORM PROJECT Annex 2 TRAINING PLAN 1. Training under the Project would be provided under the selected training sub-projects. The training institutions would provide training in China primarily in Chinese laws and in those international laws and practices which are essential to the market economy in China, such as international trade law. Training institutions are expected to include non-governmental training centers (such as the Beijing Lawyers Training Center), governmental training institutes (such as IBMI), as well as training offered at existing law faculties and universities. 2. Training sub-projects are intended to promote new training methodologies suited to the representation of clients and enforcement of laws in market transactions, which is different from the role of lawyers and officials in the former planned economy. This would be accomplished through the preparation of new teaching materials, as well as through the training of trainers in new methods. 3. Most of the trainers are expected to be local professionals, but where the subject matter includes foreign laws, foreign experts would be invited to teach the courses. An effort would be made to make use of videotape and audiotape to record such courses, with permission, so that foreign lecturers could receive the widest possible audience.