China has undertaken a massive regulatory cleanup operation, eliminating over 10,000 problematic policy documents nationwide in 2025 as part of a comprehensive effort to standardize business regulations and eliminate discriminatory practices against enterprises. The Ministry of Justice-led initiative, launched in March, has addressed critical issues including unfulfilled government obligations, illegal debt accumulation, and the problematic practice of ‘new officials disowning past obligations’.
The special operation has rectified 54,000 prominent cases across China, resulting in the recovery of approximately 28.92 billion yuan ($4 billion) in economic losses for affected businesses. In collaboration with market supervision and firefighting departments, the Ministry of Justice has prompted local governments to implement more than 330 standardized measures to unify law enforcement standards nationwide.
Significant administrative reforms include the restoration of over 50 million entries on enterprises’ abnormal operation lists and the removal of 3.5 million penalty records, substantially reducing barriers to credit restoration, financing access, and bidding opportunities. These measures have contributed to an 8.2% year-on-year reduction in arbitrary fines, with enhanced monitoring mechanisms for regions showing abnormal increases in penalties.
The campaign has specifically targeted illegal cross-regional and profit-driven law enforcement practices. A representative case from April 2025 involved a Shandong county-level law enforcement bureau that illegally penalized an out-of-town seed business for labeling violations without transferring jurisdiction to the appropriate agricultural authorities as required. The municipal supervision bureau issued rectification orders and referred the case to disciplinary authorities.
According to ministry data, these regulatory improvements have significantly boosted market vitality, with a net increase of over 5 million national market entities and a 6.8% rise in newly registered private enterprises during the first eight months of 2025—18.6 percentage points higher than the previous year’s growth rate.
Despite these achievements, Vice-Minister of Justice Hu Weilie acknowledged persistent challenges, including inadequate implementation of financial oversight systems, performance metrics tied to confiscated income, overlapping enforcement responsibilities, and arbitrary application of maximum penalties. These deep-rooted issues stem from misplaced performance evaluation concepts, insufficient professional capabilities, weak oversight mechanisms, and institutional development gaps.
The ministry plans to accelerate the introduction of comprehensive regulations, including measures for law enforcement administration and policies advancing the rule of law in comprehensive administrative reform. Future efforts will focus on scientifically delineating approval, supervision and enforcement powers, expanding regular training and proficiency testing for enforcement personnel, and aligning administrative standards across regions to support the construction of a unified national market. A national unified administrative law enforcement supervision platform will be developed to enable full-process, real-time oversight of enforcement activities.