According to the "Overall Plan," the sound establishment of the national natural resource asset management system will, in accordance with the principle of separating ownership from regulatory functions and assigning responsibility for each task to a single department, integrate the previously dispersed responsibilities of owners of collectively-owned natural resource assets. This will involve setting up an agency that uniformly exercises ownership over all types of collectively-owned natural resources and is responsible for activities such as the transfer of these resources.

Recently, the CPC Central Committee and the State Council jointly issued the "Overall Plan for Reform of the Ecological Civilization System" (hereinafter referred to as the "Overall Plan"), which represents the top-level design for China's new round of ecological civilization system reform.

The "Overall Plan" proposes to improve the national system for managing natural resource assets. Yang Weimin, deputy director of the Office of Financial and Economic Affairs, previously stated when interpreting the Overall Plan for Reform of the Ecological Civilization System that certain institutional responsibilities would need to be adjusted accordingly.

“The large-scale ecological and environmental governance system can only address coordination among various internal environmental elements, but it still struggles to strike a balance between environmental protection and development,” Wang Yi, Director of the Institute of Science and Technology Policy and Management at the Chinese Academy of Sciences, analyzed for the 21st Century Business Herald. He suggested that China should consider innovating its coordination mechanisms under the new context and legally establish procedural regulations for inter-departmental coordination.

Establish an agency to exercise unified ownership over natural resources.

According to the "Overall Plan," the sound development of the national system for managing natural resource assets will, in accordance with the principle of separating ownership from regulatory functions and assigning responsibility for each task to a single department, integrate the previously dispersed responsibilities of owners of natural resource assets owned by all the people. This will involve establishing an agency that exercises unified ownership over various types of natural resources—including mineral deposits, water flows, forests, mountains, grasslands, wastelands, marine areas, and tidal flats—that are owned by all the people, and that will be responsible for the transfer and other related activities concerning these natural resources.

Wang Fengchun, deputy director of the Legislative Affairs Office of the Environmental and Resource Protection Committee of the National People's Congress, told the 21st Century Business Herald that currently, all relevant departments responsible for resource and ecological environmental protection have administrative and asset management functions pertaining to natural resource assets. Among these, asset management primarily includes categorizing and planning asset usage, registering assets, confirming property rights and issuing certificates (including issuing water withdrawal permits, etc.), conducting statistical accounting, transferring or assigning assets, and collecting transfer fees or usage charges—functions that essentially amount to exercising agency authority over state-owned resources and regulatory authority over collectively owned resources.

Previously, Yang Weimin revealed that China is studying how to establish a “State-owned Assets Supervision and Administration Commission” to manage natural resources. The specific details of how such a commission would be set up are still under study and discussion.

“There are various different approaches to managing natural resource assets, including establishing a dedicated Natural Resource Asset Management Committee, setting up an independent asset management agency within the resource management department, or creating specialized asset management companies,” analyzed Wang Fengchun. However, judging from the current state of natural resource asset management and revenue distribution, it’s clear that simply setting up an independent asset management agency or an operating entity is far from sufficient—rather, a categorized management approach is needed.

“The management and operational revenues from commercial assets such as construction land are largely concentrated at the county and city levels, and have become a major component of local government revenue. While maintaining the current basic structure of local-level management and operational revenues, a central-level asset regulatory agency should be established. Its primary functions would include unified registration and accounting of natural resource assets, as well as unified supervision and performance evaluation of asset operations.” Wang Fengchun suggested that specialized or regional asset regulatory agencies and asset operation agencies or management companies could be set up separately at the local level, which would make the transition and reform of the institutional framework relatively less challenging.

Wang Fengchun analyzed that for public-interest assets such as nature reserves and public welfare forests, their benefits primarily manifest themselves in nationwide and regional public ecological services. Given the substantial fiscal expenditure involved, it would be appropriate to appropriately centralize management authority by establishing a nationwide, unified management system under the State Council’s departments responsible for natural resource management or environmental protection—for instance, gradually integrating various types of nature reserves, forest parks, geological parks, and scenic areas into a unified national park management system.

The reform of the environmental protection ministry system is drawing attention.

Although the “Overall Plan” does not include provisions for a comprehensive reform of ecological environment and resource management systems, this issue remains the most closely watched topic in the industry.

At the press conference held by the State Council Information Office on September 17, Yang Weimin, responding to a reporter’s question about restarting the reform of the integrated environmental protection system, stated that some institutional responsibilities would need to be adjusted as necessary. However, institutional adjustments are generally carried out during leadership transitions. As long as the overall direction is clearly defined, relevant departments will, in the future, promote corresponding adjustments to responsibilities and institutions among different departments in accordance with the directions and requirements set forth by the reform.

In fact, institutions such as the Chinese Society for Environmental Sciences, the Development Research Center of the State Council, the Chinese Academy of Social Sciences, and the Chinese Academy of Sciences have already proposed multiple sets of reform plans for institutional functions.

Chang Jiwen, deputy director of the Institute of Resource and Environmental Policy at the Development Research Center of the State Council, told 21st Century Business Herald, “We have proposed six alternative plans. In my view, the most feasible option is to divide the ecological civilization system into two categories: a natural resource regulatory agency and an agency responsible for ecological protection as well as pollution prevention and control.”

Among these, the regulation of land use in natural resource management will be transferred to the regulatory authority responsible for ecological protection and pollution prevention; the ecological protection functions previously held by the environmental protection authorities, together with the related ecological protection functions of the natural resource management authorities, will be integrated and transferred to the regulatory authority responsible for ecological protection and pollution prevention; and the functions of pollution prevention and nuclear safety regulation will also be transferred to the regulatory authority responsible for ecological protection and pollution prevention.

“If a new National Ministry of Ecology and Environment is established with the Ministry of Environmental Protection as the main body, the natural resource regulatory functions of the National Commission for Natural Resources should comply with the ecological and environmental protection requirements or use-control requirements proposed by the National Ministry of Ecology and Environment,” analyzed Chang Jiwen.

In addition, the Institute of Urban and Environmental Studies at the Chinese Academy of Social Sciences has also proposed its own reform plan: transferring responsibilities and powers related to greenhouse gas emission monitoring and regulation, climate change response, and the promotion of the development of environmental industries and environmental technologies to the jurisdiction of the Ministry of Ecology and Environment. Furthermore, the environmental protection authorities should be granted greater powers to intervene in ecological and environmental protection in sectors such as agriculture, forestry, water resources, marine affairs, and land and resource development, enabling them to prevent ecological damage at the very source of various resource exploitation and utilization activities. It may also be considered, at an appropriate time, to merge departments responsible for water resources, marine affairs, forestry, and meteorology into the environmental protection agency, thereby consolidating ecological and environmental protection efforts and enhancing the effectiveness of ecological conservation. (Reporter: Wang Erde)