Study On Franchise Of Water Serviece Industry From The Perspective Of Administrative Law

In recent years’ changing of how society is administered, the franchise of public servicefeaturing emphasis on market, competition and efficiency has become popular withexecutives at home and abroad. This article examines its validity and related problems fromthe angle of administrative law, and then offer suggestions on how to regulate and improvethe franchise of water service in China based on research on the franchise of water serviceclosely related to people’s daily life and practice of our country’s franchise of water service.The content has five parts. The first one introduces respectively the franchise of publicservice and the franchise of water service in city. Firstly,“public service” has been identifiedthat it includes water service, which is fundamental, necessary, naturally monopolistic andclosely linked to network, areas and scale economy. There are some different modes offranchise of water service, such as BOT, TOT, joint investment, O&M, acquisition andmerger, and totally private enterprise. Followed by the introduction of development of thefranchise of water service in developed country and our country, this part tells about thefundamental things of the subject in this article.The second part tries to justify the validity of the franchise of public service and city’swater service from the perspective of Economics and Administrative Law. The theory ofPublic Choice in the New Liberal Economics and the theory of Transaction Cost in theConstitutional Economics both indicate that maximum public profit could be reached byintroducing the system of public choice and competition, along with the reduction oftransaction cost, which changes all kinds of inefficiency resulting from the mixing ofgovernment and corporation. Meanwhile, in the view of administrative law, the franchise ofpublic service not only meets the core value of limited government and efficient government,but also realizes the spirit of administrative contracts, such as equality, free will, honesty, dutyand responsibility.The third part emphasizes the research on legal nature of the franchise of public service.Firstly, it analyses the legal nature of the franchise of city’s water service: at the present, ourlaw fails to clearly define the franchise of public service, which leadsTo some degree of confusion in the implement of local government and needs to beclearly defined. Then, the author judges the legal nature of the core legal contracts-franchise agreement of water service after excluding the possibility of civil contract and economiccontract that it is actually the administrative contract.The fourth part argues the present situation and problems of the franchise of waterservice in our cities and points out that the main problems are the confusion of administrativesubjects, lack in risk awareness, incomplete competition and insufficient protection of publicinterest. These problems make the advancement of the franchise greatly abate.The fifth part offers suggestions on how to make better the franchise of water service inour country, including defining the duty of government, improving the procedures in thefranchise, encouraging complete competition, advocating engagement of the public, ensuringpublic interest, perfecting the means of government regulation and strengthening riskawareness of government.