Environmental Compliance and Enforcement in CHINA AN ASSESSMENT OF CURRENT PRACTICES AND WAYS FORWARD The study was prepared in the context of the OECD Programme of Environmental Co-operation with Asia and the OECD work on environmental compliance and enforcement in non-member countries. This draft was presented at the second meeting of the Asian Environmental Compliance and Enforcement Network, 4-5 December 2006, in Hanoi, Vietnam. For further information please contact Mr Krzysztof Michalak at [email protected] or Mr Eugene Mazur at [email protected] OECD ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT The OECD is a unique forum where the governments of 30 democracies work together to address the economic, social, and environmental challenges of globalisation. 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TABLE OF CONTENTS ACRONYMS.................................................................................................................................................. 4 SUMMARY.................................................................................................................................................... 5 1. INTRODUCTION ............................................................................................................................... 9 1.1. Objective of the Study...................................................................................................................... 9 1.2. Institutional Framework for the Study ............................................................................................. 9 1.3. Structure of the Study..................................................................................................................... 10 2. PLANNING, LEGAL AND INSTITUTIONAL FRAMEWORK FOR ENVIRONMENTAL POLICY IMPLEMENTATION IN CHINA ................................................................................................ 11 2.1. China’s Environmental Context ..................................................................................................... 11 2.2. Environmental Planning................................................................................................................. 12 2.3. Institutional Framework for Environmental Regulation ................................................................ 15 2.4. Environmental Legislation ............................................................................................................. 19 2.5. Regulatory and Economic Instruments of Environmental Policy .................................................. 21 3. GOVERNMENT STRATEGIES FOR ENSURING ENVIRONMENTAL COMPLIANCE .......... 25 3.1. Institutional Arrangement for Compliance Assurance ................................................................... 25 3.2. Enforcement Actions and Non-Compliance Responses................................................................. 26 3.3. Role of the Media and Citizens in Enforcement............................................................................. 32 3.4. Effectiveness of Enforcement Mechanisms ................................................................................... 34 3.5. Compliance Promotion................................................................................................................... 36 4. OTHER INSTRUMENTS SUPPORTING COMPLIANCE ASSURANCE .................................... 37 4.1. Environmental Monitoring............................................................................................................. 37 4.2. Access to Environmental Information............................................................................................ 38 4.3. Voluntary Instruments and Role of Industry.................................................................................. 40 4.4. The Role of Trade Unions .............................................................................................................. 42 4.5. Public Participation in Environmental Decision-Making............................................................... 43 5. PERFORMANCE ASSESSMENT OF ENVIRONMENTAL ENFORCEMENT SYSTEM........... 47 REFERENCES ............................................................................................................................................. 49 3 ACRONYMS AECEN Asian Environmental Compliance and Enforcement Network CAEP Chinese Academy of Environmental Planning CCEL China Certification Committee for Environmental Labelling of Products CLAPV Centre for Legal Assistance to Pollution Victims CNEMC China National Environmental Monitoring Centre CNY Chinese Yuan/Renminbi CP Cleaner Production CRCEA China’s Registration Committee for Environmental Auditors DPS Discharge Permit System EIA Environmental Impact Assessment EPB Environmental Protection Bureau EPD Environmental Protection Division of Industrial Bureau EPL Environmental Protection Law FYP Five-Year Social and Economic Development Plan FYEP Five-Year Environmental Plan GDP Gross Domestic Product ISO International Organisation for Standardization NEPA National Environmental Protection Agency NDRC National Development and Reform Commission NGO Non-Governmental Organisation NPC National People’s Congress SEPA State Environmental Protection Agency SME Small and Medium-Sized Enterprise TEC Total Emission Control of Major Pollutant Discharges TVIE Township and Village Industrial Enterprise 3Rs Reduce-Reuse-Recycle 3S Three Synchronisations/Three Simultaneous Steps 4 SUMMARY Since the inception of its policy of opening up and economic reform at the end of the 1970s, China has achieved remarkable progress in sustaining high economic growth rates and rising incomes that have eased poverty, reduced infant mortality and lengthened life expectancy. However, rapid industrialisation and urbanisation has exacerbated many environmental problems. The quality of surface and ground waters, air in urban areas, land and natural resources has been serious. This, in turn, has adversely impacted human health and the productivity of natural resources. As the state of environment continues to deteriorate, the potential for maintaining fast economic growth may be affected. The Chinese government recognises that the current patterns of economic growth are not environmentally sustainable. The late 1990s and the beginning of the new century witnessed an important acceleration in building a comprehensive regulatory and institutional framework for environmental management. The set of Five Year Plans (FYPs), including regional and sectoral plans, provides a comprehensive planning framework for pursuing environmental progress in China. The plans contain a number of quantitative, time-bound targets and are linked to project programming designed to meet these targets. The environmental regulatory framework expanded particularly rapidly between 2000 and 2004 when a number of new environment laws were enacted, such as the Law on Environmental Impact Assessment (EIA) and the Law on Cleaner Production. In this period, a number of other legal acts were also amended, including the Environmental Protection Law (EPL) as well as the Air, Water and Waste Prevention and Control Laws. The legal system is supported by a number of specific regulatory instruments for industrial pollution control. The most important ones introduced by the 1989 EPL include: environmental quality and emission/discharge standards, the Discharge Permit System (DPS), “three synchronisations” (“3S”) and EIA. The structure and position of the national environmental agency has been strengthened over the last decades. The reorganisations of the institutional framework, particularly that in 1998, led to the creation of a State Environmental Protection Administration (SEPA) placed directly under the State Council. Although