March saw the announcement of the largest government restructure since China began its Open Door policy in the late 1970s.
A new State Administration for Market Supervision (SAMS) will be established combining the existing responsibilities of the State Administration for Industry and Commerce (SAIC), General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ) and China Food and Drug Administration (CFDA).
SAMS will be the key regulator in supervising market order, covering a wide number of business areas including business registration, market regulation, product safety, food safety, quality inspection, certification and accreditation.
A new State Intellectual Property Office (SIPO) will be established under SAMS to formulate China’s IP protection system and the registration of trademarks, patents and geographic indicators. With SIPO being an affiliate to SAMS, it is hoped that the office will have greater resources to handle administrative cases relating to intellectual property and enforcing intellectual property rights.
The creation of SAMS is China’s latest effort to reform market regulators at the central government level. Historically, the regulation of market activities has involved different government bodies with scattered regulatory functions. This has proved inefficient and resulted in complicated compliance requirements for companies.
Other reforms proposed are for:
- The General Administration of Customs to take over responsibility for entry-exit inspection and quarantine (previously part of the AQSIQ’s duties)
- The Ministry of Agriculture will be abolished and the Ministry of Agriculture and Rural Affairs will be formed to drive the development of agricultural sector and rural areas
- The reform may take up to 2 years to be fully completed and during this time companies are advised to keep an eye on the progress and spend some time understanding the changes that will affect their performance in the market as well as facilitate communication with the new government bodies.
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