The Research Of SME Promotion Law

Up to the beginning of the 21st century, about 98.5% of the enterprises in China were of small and medium-sized. These enterprises solved 75% of the national labor force employment, which accounted for over 50% of the gross national product and over 40% of the national tax revenue. These datum have already shown the importance of SMEs in the national economic development of China.On June 29, 2002, "Law of the People' s Republic of China (PRC) on the Promotion of Small and Medium-sized Enterprises" was adopted on the 28th Session of the Standing Committee of the Ninth National People' s Congress. With the commencement of the act on January 1, 2003 the long process of developing a SME Law has accomplished its objective. The intention of the legislator was to create a national regulatory framework for the establishment and promotion of SMEs in the PR China. With regard to the increasing importance of SMEs on purpose, the legislator hoped to establish a set of policy framework for the financial support, the technological innovation, the market development and the service system. Generally speaking, the aim of the legislation was to create a potent social environment for SMEs, which would guarantee that all small, medium and big enterprises receive equal treatment.With an overwhelming superiority in quantity, SME accounted for over 99% of the national total number of enterprises. Their industrial output, profit and tax contribution and amount of import and export were respectively 60%, 40% and 60% of the national total amount. Meanwhile, they have provided 75% of employment opportunities in cities. For example, during the period from the yearl978 to 1996, there were 0.2 billion labors shifting from the countryside, and most of them were employed by SMEs. In the year 1998, SMEs received 4.6 million workers laid off from the state-owned enterprises. Therefore, SME have played a vital role in such aspects as promoting the national economy development, alleviating the unemployment pressure, facilitating life of the public, stimulating the technology innovation, promoting the national economic development and safeguarding the social stability, etc. However, many problems still existed in the development of SMEs, such as unfair treatment policy, outdated and inefficient management system, difficult financing, unbalanced asset and liability ratio, backward technology, lack of information and talents, etc. Therefore, it is practically significant to establish the promotion law for SMEs and to promote their development. From an overseas view, many countries tend to use the legal instruments to guarantee and promote the development of SMEs. For example, countries such as the USA, Germany and Japan all established their own special "SMEs Promotion Law" . From a domestic view, Taiwan area also established the correlative legislation of the law on SMEs, to safeguard the rights and interests of SMEs and to promote their development. Therefore, it is very necessary to learn the successful example from domestic and foreign countries and to expedite our legislation of SMEs.