Waiting for the law - News Analysis - China's Ministry of Information Industry

Telecom Asia, Jan, 2003 by Steven Schwankert

"Telecom Draft Law on the Right Tracks" reads the headline on the state-run People's Daily Web site. Unsurprisingly upbeat, the article may have been correct when it was published--in April, 2001.

It wasn't the first time that China's Ministry of Information Industry (MII) or its head, Minister Wu Jichuan, cried wolf about the impending completion of the nation's comprehensive telecom law. In October, 1999 Wu announced that the law would be "promulgated soon."

However, it has becom clear that China's long march towards a telecommunications code is not going to end, as many had hoped, at the National People's Congress (NPC) meeting in March. New legislation can be approved at several points during the year, but the NPC serves as a showcase for major legal initiatives, and the long-overdue law was expected to be ratified there.

The other question is how much input foreign players are allowed into the drafting of the law. Chip Barton, the Asia-Pacific president of AT&T international ventures, points to the "confusion" surrounding the recent IDD price hike.

"The important thing is to have clarity and understanding of the rules. You understand what you are able to do and what the limitations are," he said.

He called for a consultation process with all the industry players as part of the framing of the new law.

"A government that consults with industry is going to ensure they have all the perspectives prior to issuing rules and regulations."

One factor slowing down the promulgation of the law is the likely appointment of a new minister to the MII, Wang Xudong, from March. Wang, a self-described "Luddite" despite being trained as an engineer, is for the most part an industry outsider. What views he might want the law to reflect is anyone's guess, and his arrival could keep the matter under debate even longer.

However, one observer took another perspective: "The other way to read it would be that Wu would want to put his own stamp on [the law]," as his own legacy, said Ted Dean, a partner at Beijing-based consulting firm BDA. As a result, Wu might push the law towards both completion and ratification before leaving the MII.

Years in the making, the telecom law has faced continual delays because of changes in both the telecom industry and China's market economy. Add to this the rise of the Internet, China's burgeoning mobile market, the recent restructuring of China Telecom, and now Wu's departure, and it seems uncertain when the law will emerge.