CBN丨China adopts first law dedicated to promoting private sector

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China's national lawmakers on Wednesday voted to adopt the country's first fundamental law dedicated to promoting the private sector, underscoring support for a key part of the world's second-largest economy.

After over a year of legislative process, the private sector promotion law, passed at a session of the Standing Committee of the National People's Congress, will take effect on May 20, 2025.

The adoption of the private sector promotion law marks a milestone in the development of the nation's private economy, a major economic driver, since the beginning of reform and opening-up, experts said, noting its importance as the country ramps up efforts to foster new quality productive forces.

Comprising 78 articles in nine chapters, the law covers such areas as fair competition, investment and financing promotion, scientific and technological innovation, regulatory guidance, service support, rights and interests protection and legal liabilities.

The law aims to further improve the environment for the development of the private sector and ensure fair market competition for all types of economic entities. It also promotes the healthy development of the private economy and supports the comprehensive growth of entrepreneurs.

Duringthe drafting and deliberation process, lawmakers solicited public opinions through 54 legislative outreach offices and gathered broad feedback from private enterprises in various sectors, according to the members of the NPC Standing Committee.

Private enterprises have long been a key driving force behind China's economic ascendance, contributing more than 60 percent of GDP and 80 percent of urban employment.

In the first quarter, 1.979 million new private enterprises were registered, marking a 7.1 percent year-on-year increase - surpassing the average growth rate of the past three years. By the end of March, the number of registered private enterprises surpassed 57 million, accounting for 92.3 percent of all businesses nationwide, according to the State Administration for Market Regulation.

New quality productive forces have become a key highlight of China's private sector. In the first quarter, 836,000 new private firms were registered in the "four new economies" - new technologies, industries, business formats and models, accounting for more than 40 percent of new private enterprises.

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