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Proper handling in China "applauded" for helping maintain health of market

China"s top judicial official urged courts at all levels to improve bankruptcy trials to ensure a fair and just business environment.

"Tribunals for bankruptcy cases should also contribute to effectively and legally handling and cleaning up the country"s "zombie" companies according to laws and regulations in the years to come," said Zhou Qiang, president of the Supreme People"s Court.

Zhou made the remarks at the national work conference on bankruptcy trials held in Shenzhen, Guangdong province, on Monday.

Du Wanhua, a senior judge at the top court, said China"s bankruptcy trials have been making rapid progress and are playing an increasingly important role in the development of the country"s market economy.

According to the 2017 evaluation of business environment of 190 economies by the World Bank, China ranks 53rd in the number of bankruptcy cases. It was 82nd in 2013.

"China"s bankruptcy trials have been applauded by all circles of society in past years," Du said, noting that courts had handled nearly 9,000 cases involving company bankruptcy this year.

"Bankruptcy courts on the Chinese mainland saw a year-on-year caseload increase of 20.6 percent in 2016," he said.

He urged courts to establish an improved trial system and better serve the country"s development and the market economy in the years ahead.

Du said bankruptcy trials should also help further boost the establishment of a modern enterprise system and help Chinese companies further raise their competitive capacity at home and abroad.

He Zhongyou, a member of the Standing Committee of the Guangdong Committee of the Communist Party of China, said the province has urged its courts to pay special attention to reforming bankruptcy trials to better serve development and supply-side reform.

"Guangdong took the lead in the country in establishing tribunals for bankruptcy cases in the 1990s," He said.

The handling of bankruptcies has been a significant factor in the health of the market economy in Guangdong, which serves as a window on China"s reform and opening-up drive and is home to myriad foreign-funded companies, joint ventures and private enterprises.

Shenzhen established the country"s first tribunal to hear bankruptcies in 1993.

Li Shuguang, dean of the graduate school at China University of Political Science and Law, said China"s bankruptcy trials should contribute more to standardizing the operations of domestic companies.

"Bankruptcy trials have played a big part in the development of the country"s market economy," Li said.

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