KEYWORDS: Deng Xiaoping, Naked Officials, Instant Messaging, Anti-trust Investigations, Political Reform in Hong Kong.

CHINA – POLITICS

1. Deng Xiaoping TV series premiere

1. CCTV is airing a dramatization of Deng Xiaoping’s political career from 1976 to 1984. The 48-episode TV series, called Deng Xiaoping at History’s Crossroads (历史转折中的邓小平), was made in commemoration of the Deng’s 110th birthday. It tells the story of Deng and the historic transformation of China in the late 1970s. According to Xinhua, “[..] The premiere was held at the Great Hall of People. Officials from the three units, relatives of Deng, critics, and the crew of the TV series recalled the life of the late, great Chinese leader. The TV series, which took five years to make, describes Deng’s experiences between October 1976, when the “Gang of Four” was purged until 1984 when the country fully implemented the policy of reform and opening up.”
   Source: Xinhua
2. Observers elaborate on the show’s “daring subject matter”, the appearance of the Xidan Democracy Wall and Hu Yaobang at the very beginning of the first episode.
   Source: Ifeng
3. According to Mingpao, former purged leader Zhao Ziyang will also appear in later episodes, although his name will not be mentioned.
   Source: Mingpao
4. The report also elaborates on the making of the drama series: 本劇去年9月開鏡後，拍攝112天煞科，後期製作則長達7個月，送給各級領導審查的光碟超過1萬張，僅審查就耗時4個月。內部人士透露，《鄧》劇的劇本也經由中央文獻研究室易稿3年才確定，經過多個部門的嚴格審查，中央文獻研究室還親派專家指導，後期經過「超乎尋常」的多次修改。不過，無論是從劇集中首次出現趙紫陽鏡頭，還是給予敏感人物華國鋒、胡耀邦、汪東興等更多「戲份」，此劇在尺度上都有很大程度的突破，「這在以往是完全不可想像的，在政治題材影片中可以稱為里程碑」。
   Source: Mingpao
5. Netizens are complaining that the Deng drama is yet another brain-washing propaganda. One netizen wrote “Right after Mao died, Deng was still fixing tractors in Jiangxi. It was Hua Guofeng and Ye Jianying who got rid of the Gang of Four. Only then did Deng gradually come out of the woodwork. Looking forward to this brain-washing drama!” Other complained that the series cut off at 1984, hiding the brutal suppression of protesters in June 1989. Source: CDT

2. Anti-corruption: finding “naked officials” in 10 provinces

1. According to the SCMP, “China’s anti-graft watchdog is ramping up efforts to uncover so-called “naked officials” in 10 provinces by probing the entire ranks to see who has family abroad. […]The official website of Jilin’s Dunhua county said it received orders from provincial authorities to collect information about the families of “government workers from all departments”. The order was also sent to local governments in Anhui, Guizhou, Zhejiang, Hunan, Jilin and Sichuan, the Southern Metropolis Daily said. [The notice said,] Officials must pay particular attention to those whose relatives have “obtained foreign citizenship or foreign residence permits”.” The Central Organisation Department – which is in charge of staffing, among others – issued a regulation barring all naked officials from holding key posts in the government and military. These cadres “should not hold services in chief posts in Communist Party committees, the people’s congress, discipline and legal departments, SOEs, posts related to military, diplomacy, public and national security, national defences and all the posts related to financial supervision and technological security”. It defined “moving abroad” as “obtaining foreign citizenship or permanent or long-term foreign resident permits”. Naked officials will be banned from promotion if their spouses or children fail to give up foreign citizenship, according to a separate regulation released by the organisation department in January.
   Source: SCMP
2. But government authorities have ordered media not to hype discussions on the investigation on naked officials. Central Party School professor Zhang Xixian told the People’s Daily: ““The reasons the provinces are not making this public are that, first, we are in the midst of a critical period of ‘catching tigers,’ so many people are concerned about self-preservation; and second, the ‘naked official’ problem may involve a rather large number of people, including relatively high-ranking cadres, and there is fear that disclosing the particulars of the situation could cause a political ‘earthquake’”. Zhang also said that “to make them report their assets…requires more time to establish a complete legal framework.”
   Source: CDT, People’s Daily
3. John Garnaut writes on the New York Times, describing Xi’s recent struggle against “tigers” as the manifestation of the “you live, I die” mentality.
   Source: NYT
4. Another former high-ranking Chinese military leader, Guo Boxiong, is under investigation for allegedly taking bribes to facilitate promotion, according to the HK-based The Information Center for Human Rights and Democracy. Guo is the former Central Military Commission Vice Chairman, number two of the PLA. If confirmed, Guo would be the second retired vice chairman of the commission to become a major anticorruption target following Xu Caihou, who was expelled from the ruling Communist Party in June for accepting bribes.
   Source: Global Post
5. Recent analysis on Xi’s administration: Li Cheng published a part 2 for Xi Jinping’s Inner Circle, on “Friends from Xi’s Formative Years”; Sebastian Veg publishes an article on the Diplomat examining “China’s Political Spectrum under Xi Jinping”.
   Source: Brookings, Diplomat

3. New rules on instant messaging

1. Amidst Beijing’s recent efforts to tighten control over the Internet including a crackdown on online rumors (which prompted a mass exodus from microblogging platform Sina Weibo to private messaging services), a subsequent crackdown on Tencent’s instant messaging app WeChat (and month-long renewal), and an ongoing anti-vulgarity drive, the State Internet Information Office (SIIO) announced new rules for users of instant messaging platforms. According to Xinhua, “the regulation will require users (public accounts) of instant messaging services to use real names when registering in an effort to hold users responsible for content. First time users will be required to provide their real name, while users who have previously registered accounts will experience limited access to the instant messaging service.” Xinhua quoted Xu Feng, head of mobile internet management at the SIIO, who said that « some people are damaging other people’s rights and interests and public security in the name of freedom of speech…The regulation will promote the quality of instant messaging services to ensure that citizens enjoy the convenience of such services. This is the true freedom of speech. »
   Source: Xinhua
2. China Copyright and Media has translated the regulation in full.
   Source: China Copyright and Media
3. Expert predicts that new rules could muffle conversations on WeChat, just as prior campaigns had chilled the once-lively social atmosphere on Weibo. Fu Kingwa, academic at HKU’s Journalism and Media Studies Centre, commented that the rules “could cool down the traffic of WeChat public accounts and discourage journalists from setting up individual WeChat public accounts”.
   Source: Reuters
4. Prior to the release of the SIIO rules, the SCMP noted that Tencent had independently announced it would be targeting “fraud, pornography and ‘spreading rumors’,” creating anxiety among some users that a fresh wave of Internet censorship was looming. It mentioned new regulations in Zhaoqing, “a city in Guangdong”, which “recently announced that WeChat public accounts held by individuals or organisations must be registered with the police within a month. The Zhaoqing government’s move – believed to be the first of its kind by any local government – would help tighten control over the spread of rumours and illegal information on WeChat, said a joint statement by the city’s public security, publicity, publishing, and industry and commerce bureaus. Existing public accounts held by individuals and organisations need to be registered with the police within 30 days of the release of the statement, which appeared on the city’s government website on July 29.”
   Source: SCMP
5. In a recent interview with state media, an SIIO spokesperson answered a question about free speech concerns by saying that, actually, these regulations protect “true free speech”. From Xinhua, as translated by China Copyright and Media: “It is quite the opposite, the publication of the “Regulations” benefits the protection of true free speech. Our cyberspace cannot become a disorderly, pell-mell space full of transgression. No country in the world permits the dissemination of rumours, violent, fraudulent, sexual or terrorist information. Freedom and order are a dialectical relationship, any person’s freedom must be exercised within the scope of the law, baselines cannot be broken, and this would impede other persons’ freedom.”
   Source: China Copyright and Media

CHINA – ECONOMY

China’s brewing anti-trust storm

1. Recently, Chinese regulators have launched a series of anti-trust investigations into foreign automakers and technology companies, including Audi, Chrysler, Microsoft, and Accenture, for suspected monopolistic practices. According to the WSJ, regulators from the State Administration for Industry and Commerce said they conducted surprise inspections of Microsoft Corp.’s China offices in regard to suspected monopolistic practices, and later Accenture’s offices in Dalian because the consulting firm was doing outsourced financial-services work for Microsoft. Two carmakers, Audi AG and Fiat Chrysler Automobiles, were also accused of having pursued monopolistic practices, in Hubei province and Shanghai respectively. The same report quoted expert saying that this show “Beijing’s desire to give Chinese companies greater heft in their dealings with foreign firms”.
   Source: WSJ
2. The Microsoft investigations came amidst Chinese state efforts to curb foreign antivirus software in response to growing cyber surveillance concerns. Reuters reports that several Microsoft products, including OneDrive and Windows 8, have come under the scrutiny of the Chinese state in recent months.
   Source: Reuters
3. For more about anti-trust investigations on carmakers, see this Chinese report by Nanfang Zhoumo. Audi was rumored to have been fined RMB 1.8 billion which broke the record of anti-monopoly fines in China, according to the HKEJ.
   Source: Nanfang Zhoumo, HKEJ
4. Financial Times argues that this signals the start of increasingly rigorous regulatory effortsthat aim to greatly strengthen the enforcement of anti-monopoly laws passed in 2008. “The spate of high-profile anti-trust investigations announced in recent weeks may be the tip of the iceberg in China’s growing enforcement of its six-year-old anti-monopoly law.” It quoted a anti-trust lawyer saying that anti-trust investigation began last year but efforts will be much greater this year, with NDRC increasing their staff from just two to now more than forty. David Stallibass, co-editor of China’s Anti-Monopoly Law: The First Five Years, whom FT interviewed, said that “[t]he macro-economic objective of the regulators is to improve the efficiency the Chinese economy and the efficiency with which the CCP can manage the economy”. But FT also raises that “[t]he decision to prioritise headline-grabbing cases may be tied to internal competition between the three regulatory bodies (SAIC, NDRC and the Ministry of Commerce), all of which are currently vying for attention to secure a place within what has become an uncertain political environment since Xi Jinping took office in 2012.”
   Source: Financial Times
5. FT’s Jamil Anderlini substantiates this view that it is more about institutional infighting and internal political turf wars than a master plan to exclude foreign investors from the country. “One of the biggest institutional losers in the administrative reforms introduced by Mr Xi when he took office”, he argues, “has been the NDRC, which was previously regarded as the most powerful of all China’s bureaucracies. The agency’s licensing, planning and approval powers have been significantly curtailed since Mr Xi took power and its standing within the government has plummeted, along with its ability to seek rents and procure bribes. Anderlini talked to Liu Xu, a researcher at the intellectual property and competition law research centre of Tongji University in Shanghai, who said that “[a]s the current administrative reforms deepen, the NDRC fears it might lose the power to carry out anti-monopoly investigations so it is pushing these high-profile investigations of foreign companies”.
   Source: Financial Times
6. Others speculate that recent investigations may be politically-motivated strategies that are a part of a broader protectionist move ushered in by the Xi administration. According to Reuters, the U.S. Chamber of Commerce sent a private letter to Secretary of State John Kerry and Treasury Secretary Jacob Lew urging Washington to get tough with Beijing since enforcement of the anti-monopoly law was being used to pursue “China’s industrial policy goals”. The letter said that “it has become increasingly clear that the Chinese government has seized on using the AML to promote Chinese producer welfare and to advance industrial policies that nurture domestic enterprises, rather than the internationally accepted norm of using competition law to protect consumer welfare and competition”.
   Source: Reuters
7. According to the HKEJ, an academic was dismissed from a State Council consultative committee on anti-trust affairs for violating work discipline as he expressed different opinion on the recent spate of investigations.
   Source: HKEJ
8. A Shanghai court recently convicted two corporate investigators for illegally purchasing personal information on Chinese citizens, sending shock waves through the foreign business community in China. Peter Humphrey, a 58-year-old British man, was sentenced to 2.5 years and fined 200,000 yuan, and will be deported after serving his sentence. Yu Yingzeng, 60, his partner and wife, will serve a two-year sentence and face a fine of 150,000 yuan, but will retain rights to stay in China. Chinese prosecutors accused them of illegally obtaining more than 250 items of personal information about unidentified Chinese citizens, paying up to $320 per item, and selling the information to clients including multinational companies through their private investigation firm, ChinaWhys Co. The couple were hired by the UK drug giant, GlaxoSmithKline, which was recently involved in a bribery scandal, to investigate the origin of a sex video taken secretly in the bedroom of the drug company’s top China executive and emailed along with allegations of bribery to his superiors in London by a whistleblower whose identity was unknown.
   Source: WSJ
9. According to the WSJ report, “[t]he case, the first of its kind to involve foreign investigators, according to the Chinese government, highlights legal risks—such as violating privacy or state-secret laws—of holding or relaying personal information of Chinese citizens. Such anxieties are already high among firms that specialize in or depend on due-diligence background checks on potential business partners and employees, for example to avoid running afoul of corruption legislation like the U.S. Foreign Corrupt Practices Act.” Experts foresee that the ruling « will have a chilling effect for businesses operating in China”. “It impacts all attempts to do business between the U.S. and China because it will be very challenging to verify the accuracy of company or personal financial information”. “The verdict is the latest in a string of signals from Chinese authorities that suggest an increasing desire to control access to information, often in ways that limit the scope for foreign businesses to use it. The privacy law itself was tightened in 2009 to make it illegal to handle certain personal medical and telephone records—the court alleged violation of the law in Friday’s case—but it nevertheless remains vague, according to lawyers. More recently, Chinese financial regulators classified as state secrets accounting data on locally based businesses, saying it was illegal to transmit certain auditing figures overseas even when the companies have stock listed outside China”.
   Source: WSJ

HONG KONG – POLITICS

 Central government liaison office director is meeting the pan-democrats

• Central government liaison office director Zhang Xiaoming will meet pan-democrat lawmakers this week and next to discuss electoral reform. According to the SCMP, “[t]he pan-democrats hope to persuade the central government to present a flexible framework for reform later this month. But leading advisers to Beijing said the meetings with central government liaison office director would be only symbolic.” The meeting will take place at the government headquarters at Tamar, and will be attended by Chief Secretary Carrie Lam, Secretary for Justice Rimsky Yuen and Secretary for Constitutional Affairs Raymond Tam. Zhang said last week that electoral reform had to be considered from the « perspective of national security » and Beijing must not allow Hong Kong to become a base for subversion.
  Source: SCMP
• SCMP also quote a source familiar with the matter, who says that Beijing is willing to postpone universal suffrage. If it doesn’t happen in 2017, the next chance for reform may not be until 2027, because of the polarisation of the debate, according to the source. Another mainland source said the committee would lay down principles such as preventing people who confronted Beijing from being elected.
  Source: SCMP