The Winds of Change
The highlight of the decisions made in the third plenary session of the Communist Party's 18th Central Committee was without a doubt reforming the judiciary.
There are two major sources of problems in the Chinese judicial system: local government interference in judicial affairs, and excessive entwinement between administrative and judicial bodies.
(WU Jinlian, LIU Chuanzhi, QIN Hui et al. (2014), Democracy & Construction Press)
The first thing that needs to go is local interference in the judiciary. As local courts at all levels are not independent, but controlled by party committees and governments at the same level in personnel, financial, facilities and other matters, jurisdiction in legal cases is determined by administrative districts. This makes it impossible for judgments to be made independently, which then makes impartiality a virtual impossibility. The widespread incidence of local protectionism has not only harmed the credibility of the courts, but far worse, has fragmented the national order.
So the goal of the third plenum decision to administer unified management of local courts and procuratorates beneath the provincial level, as well as to separate justice department jurisdictions from administrative jurisdictions, is to ensure the unified implementation of rules via gradually eliminating local interference in the judicial system and to establish a "legal community."
Such vital reforms have been warmly welcomed by the general public. There is, however, one concern. Once both judicial and administrative powers are concentrated in provincial-level high courts, will the power of the Supreme People's Court to coordinate them be compromised? As concrete measures are taken to weaken local government powers in 2014, reformers will have to answer another question: how to reasonably and effectively restructure coordination mechanisms between the Supreme People's Court and provincial-level courts and further define the top court's powers to assess and elevate judges nationwide, as well as its powers to approve judicial budgets and strategies.
Now let's take a look at excessive administrative involvement in the justice system. Dense entanglement between judicial and administrative powers is a peculiarity of the traditional Chinese system. The bureaucratic way of thinking, management skills and the logic of vertical oversight are the constant companions of judicial procedures in the country, making it impossible for the courts to remain independent; the responsibilities that accompany power to remain clear; and the doctrine of res judicata to stably control legal documents. Officials at the third plenum have decided upon an unprecedented degree of reforms to local administrative powers. The most noteworthy of those reforms is the clear defining of judgment entities via the accountability system.
So beginning in 2014, two primary measures will be taken to separate judicial and administrative powers. The first will be to restructure "adjudication committees" – a unique body in China's judicial system that reviews important cases and that has the right to review judges' suggested opinions and decide on penalties – and rectify the abuses in the system caused by "multiple parties handling a single case" and "judgment by committee." The second will be to realign the relationship between superior and subordinate courts, rectify the oversight mechanisms above the judicial hierarchy system, and clarify the checks and balances between judicial powers.
That, in essence, means extending independence not only to the judiciary at the systemic level, but also to individual judges and collegial panels. If corresponding steps are all taken, the Chinese court system, nearly unchanged in 60 years, will be revolutionized.
Officials at the third plenum also established a number of matching measures to ensure the independence and impartiality of the judiciary and prevent corrupt judges from getting up to mischief. For example, they established a judicial personnel management and identity safeguarding system in order to separate such legal positions as judges and prosecutors from their administrative ranking. They passed measures to increase the transparency of trial and prosecution processes, for the public disclosure of grounds behind judicial decisions and legal precedents and for publicizing of implementation situations of court ruling — all in order to eliminate dereliction of the law and official malfeasance. They improved allocations of judiciary powers, shored up division of labor, and reordered checks and balances between institutions. We must make special note of the fact that lawyers will now be allowed to play the role of Socrates' "social gadfly," stirring up dissent to preserve the rights of citizens and to increase both the quality and credibility of the legal system.
We must also acknowledge that in China's present reality, the judiciary lacks real powers, as well as sufficient credibility and prestige. To remedy those shortcomings, while also increasing entry thresholds and professional qualifications for judiciary personnel and improving on key aspects such as impartial procedures and rules of evidence, top officials must also bestow upon judicial organizations the "imperial sword" for upholding the constitution. The decisions of the third plenum have in effect entrusted to the courts the sword of justice they need to prosecute anti-constitutional behaviors. The mechanism should be established in 2014. Only by establishing judicial mechanisms for investigating violations of the constitution can we truly ensure judicial protections of human rights.
Two Indicators
The reason that judicial reforms have become a major component of restructuring the relationship between the government and markets is that they are the entry point for restructuring state power. Now that the policy of reform and opening has evolved into a new developmental stage, markets will play a decisive role in resource allocation. So free choice and fair competition will of necessity become the major themes of the coming era. To this end, we must change government functions and reduce government interference in day-to-day affairs as much as possible. In areas in which mandatory approvals are abolished, market mechanisms will play a decisive role, but unrestrained freedom and power of the market is dangerous too. Facing such possibilities of transformation, we must use clear rules to ensure the freedom and fairness of competition, as well as "post facto corrections" for those behaviors out of alignment with the big picture of reforms. So as markets begin to play a more decisive role, government powers will ceaselessly diminish, and so courts will have to play an increasingly important role.
Market competition mechanisms will of necessity promote differentiation and segmentation of social functions, lead to the formation of different interest groups. All manner of petitions, coordination and crystallized consensuses have become the basic duty of governance. But state power must maintain its neutrality and objectivity in order to be received and believed by different interest groups.
In order to prevent the government from teaming up with a particular powerful interest group to bully a weaker group, rule of law has become the greatest consensus of the entire society. The public will demand that all be equal before the law and that no individual or group enjoy special privileges or flagrantly violate the law. In order to protect the impartiality of law enforcement, the masses will also demand that judicial independence, procedural impartiality and protection of rights be amply safeguarded.
Courts, the third party between the government and the mass public, should embody the classical role of a neutral and rational judge, and should be the most direct executors and most reliable protectors of the constitution and other laws.
In market operations, particularly financial market operations, courts are an extremely important institutional condition for the concrete judgment of individual cases from the macro perspective. Otherwise, they will incite unlimited amounts of opportunistic behavior and disorderly competition. That might to a certain degree explain why major international financial centers in the world tend to appear in countries or regions that practice common law, such as London, New York, Hong Kong and Singapore.
A study of the Shanghai Pilot Free Trade Zone indicates that the cornerstones of success are the liberalization and internationalization of finance, and that legal system reforms are the most significant of all the FTZ's experiments.
It is not difficult to imagine that an emerging financial market cannot be restricted to a mere 28 square kilometers of a special zone. Without cross FTZ border activities, there can be no financial system reform to speak of. If such financial flows were to be allowed, the pilot zone would become insignificant.
This demonstrates that the importance of the pilot zone does not lie in the work of financial programs, nor in the simulation of global financial markets, but rather in the formation of a "special legal zone." By that I mean the FTZ's elimination of the various obstacles which are difficult to avoid in the current system; its pushing of extremely thorough judicial reforms; and its outfitting the International Financial Center with the commercial regulations, professional courts and other institutional conditions it requires for success.
In summary, there are two major weather vanes we can use to observe the present and future conditions of reforms to the judicial system. The first is whether — within the free trade pilot zone — the demands of effective operations of international financial centers and factor markets can be met; whether a truly independent, professionalized judicial system that completely adheres to the needs of linking up with the global economic system can be established; and whether it can push transformations to justice models around the world. The second is whether — outside of the free trade pilot zone — we are able to further shore up mechanisms for protection of property rights, enforcing contracts and preventing miscarriages of justice based on the demands of upholding the constitution, legal prestige and bringing about human rights, and gradually form an adjudication mechanism of judicial nature for prosecuting violations of the constitution.
Only by truly accomplishing the two above goals can the establishment of rule-of-law in China be successful.
Published on the book named China 2014 Gearing Up for Reform | 2014-4
