China’s Legal System: From Legislative, Executive and Judicial Functions to… the CPC

When referring to the politico-economic system of China here on ChinaFund.com (and pretty much everywhere, for that matter), the term “socialism with Chinese characteristics” is frequently used. The “with Chinese characteristics” dimension is crucial when it comes to our brief analysis of China’s legal system because the more research you conduct on China-related topics, the more you realize one ends up using “with Chinese characteristics” when it comes to pretty much all sectors of China.

As far as its legal system is concerned, think of it as a system with many similarities in terms of its fundamental structure to Western ones, but which inevitably has… well, Chinese characteristics. Or, in our case, the singular “characteristic” would perhaps be better-suited because the key term in our analysis will be the Communist Party of China (CPC).

In other words, just like Western systems, China’s legal system displays the three dimensions most analysts are accustomed to: the legislative dimension (passing laws), the executive dimension (running the country on a day-to-day basis) and the judicial system (settling civil and/or criminal disputes through the court system). On top of them, however, or should we say in parallel, there is also the Communist Party of China which plays an extremely significant role and it’s precisely this component which tends to give Western observers headaches.

Before focusing on the latter, let’s refer to the three dimensions one by one:

1. The legislative dimension of China’s legal system has the so-called National People’s Congress (or NPC) and the Standing Committee of the NPC at its center, which facilitate the passing of laws. The National People’s Congress itself is allowed to modify the Constitution and amend basic laws, whereas the Standing Committee of the NPC steps in when it becomes necessary to amend or interpret laws which fall outside the scope of the NPC
2. The executive dimension puts the State Council in the spotlight or to use the official term, the State Council of the People’s Republic of China, which is allowed to create and enforce rules as long as they are in line with existing laws. Furthermore, the various commissions and ministries under the SC are allowed to make rules in their specific areas of interest and aside from that, the SC is also allowed to submit proposals to either the NPC or the Standing Committee of the NPC in the hope that they will be turned into laws
3. Finally (as far as the three sectors are concerned), the judicial system is a court-based one with the highest-ranking entity being the Supreme People’s Court or SPC, with the High People’s Court (provincial) below it, the Intermediate People’s Courts at the municipal level and Basic People’s Courts at the local level. It’s worth noting that unlike in the West, past court cases are not considered binding in nature as precedents under the Chinese system. However, they are centralized and frequently act as at least some form of guidance

… fairly straightforward thus far, right?

We have a fairly straightforward system, governed by a Constitution which was last amended back in 2004 and stipulates that the power lies in the hands of the people, with their will being implemented by representatives. Unfortunately, things get tricky as of this point due to the fact that… well, Chinese characteristics kick in.

As far as Western systems are concerned, independence is the operative word. To put it differently, it is a core pillar of Western liberal democracies for the legislative dimension not to be influenced by the executive dimension, for the judicial system to function independently of what the executive system would prefer and so on. Separation of powers 101.

However, China is not a Western liberal democracy and as such, certain principles such as the separation of powers don’t exactly apply. Furthermore, while the Communist Party of China does not have legal roles that are set in stone, it is deeply entrenched in all areas that have to do with running China, whether they are legislative, executive or judicial. Whether you agree with this status quo or not, the system is what it is.

Furthermore, just like many other sectors in China, the legal system can be considered a work in progress. Or, to be more blunt, the legal system hasn’t always been entirely capable of catching up with the real economy. From legislative uncertainties to various loopholes, there are many consequences which one has to deal with as a result.

Therefore, this much is certain: if you approach the Chinese legal system from a Western perspective and expect to find a high degree of legislative predictability and various forms of independence, you will inevitably end up making potentially costly mistakes. It is therefore vital to understand the proverbial rules of the game when it comes to China, something ChinaFund.com will gladly be of assistance with.