Observations on the First Draft Revision of the Administrative Reconsideration Law

The National People’s Congress Standing Committee (NPCSC) is substantially revising the Administrative Reconsideration Law (ARL), which provides an underutilized procedure to challenge government actions through internal agency review.  Reconsideration decisions can in turn be appealed to the courts, under China’s Administrative Litigation Law, to which aggrieved parties can generally and often do turn to resolve disputes with the government, without ever going through reconsideration. With courts feeling overwhelmed by large caseloads and emerging new legal issues to address, the NPCSC published[1] a first draft for public comment on October 27, 2022 (the Draft) of a substantial overhaul of the ARL that seeks to make reconsideration the preferred channel for resolving administrative disputes.  It hopes to accomplish this by both (1) enhancing the credibility of the reconsideration process to encourage aggrieved parties to try reconsideration first (the carrot), and (2) expanding the situations under which reconsideration is required as a precondition for litigation (the stick).

While reconsideration is cost-free and a potentially quicker option, its disadvantage is the apparent bias inherent in the ARL’s arrangement for challenging government agency decisions within the vertical administrative hierarchy of, or before the local government at the same level as, the agency that made the original decision.  The reported rate at which challenged government decisions are corrected through reconsideration has averaged only 14.3 percent.

Starting with the stick, the Draft increases the few existing situations under which reconsideration is a condition precedent to bringing an administrative lawsuit.  The ARL currently stipulates that disputes over ownership and rights to use natural resources must first undergo reconsideration before appeals to the courts, and that reconsideration decisions made by governments at the provincial level are final.  It also refers to situations where other laws or regulations require that a plaintiff first undergo reconsideration, which currently include disputes over taxes, customs, foreign exchange, minimum living guarantees, film screenings, religious affairs, and demonstration permits.  In some cases, including decisions on entry and exit management of foreigners, the reconsideration decision is final.  The Draft would add disputes alleging government failure to perform its statutory duties and where administrative punishments such as fines were imposed on the spot rather than going through normal procedures to the list of issues that must undergo reconsideration.

To encourage greater voluntary selection of reconsideration to resolve disputes for which reconsideration is not mandatory, the Draft proposes to, among other suggested changes:

• Expand and clarify the scope of cases that can be handled through reconsideration, including disputes over administrative agreements with the government, government information disclosure, and abuse of authority that restricts competition, but also excluding acts that do not actually impact rights and obligations;

• Centralize reconsideration authority, removing it from local government departments to place it in specialized offices of people’s governments at the city, county and provincial levels; State Council departments will handle reconsideration cases involving them in some way; disputes involving vertically-integrated departments such as customs, tax, foreign exchange and national security will continue to be handled by the next-higher level departments;

• Hear directly from the parties rather than rely on the traditional “paper hearing,” except in some cases subject to new summary procedures, and provide for more formal hearings for major, difficult, and/or complex cases;

• Authorize the use of mediation, as had been permitted under 2007 implementing regulations, although only in cases where the administrative action in dispute involved the exercise of discretion; and

• Stipulate evidence rules.

The period for public comment ended in late November, and a second, further revised draft may be published for comment this year, before the revision is finalized.

[1] The Ministry of Justice, on behalf of the State Council, published an earlier, longer proposed ARL revision for public comment in November 2020, and the State Council approved a draft in September 2022 to submit to the NPCSC for consideration.