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The following table shows Dealing with Licenses data for China compared to best practice and comparatoreconomies:Best Practice EconomiesProcedures(number)Duration(days)Cost (% ofincome percapita)Denmark 6Korea 34United Arab Emirates 1.5Selected EconomyChina 37 336 840.2Comparator EconomiesBrazil 18 411 59.4Hong Kong, China 23 155 21.3India 20 224 519.4Japan 15 177 17.8Mexico 11 131 103.5Russia 54 704 3788.418
Employing Workers in China: Labor RegulationsEvery economy has established a complex system of laws and institutions intended to protect workersand guarantee a minimum standard of living for its population. This system encompasses four bodies oflaw: employment, industrial relations, social security and occupational health and safety laws. DoingBusiness examines government regulation in the area of employment and social security laws.Three measures are presented: a rigidity of employment index, a nonwage labor cost measure and afiring cost measure. The rigidity of employment index is the average of three subindices: difficulty ofhiring, rigidity of hours and difficulty of firing. Each index takes values between 0 and 100, with highervalues indicating more rigid regulation. The difficulty of hiring index measures the flexibility of contractsand the ratio of the minimum wage to the value added per worker. The rigidity of hours index coversrestrictions on weekend and night work, requirements relating to working time and the workweek, andmandated days of annual leave with pay. The difficulty of firing index covers workers’ legal protectionsagainst dismissal, including the grounds permitted for dismissal and procedures for dismissal (individualand collective).The nonwage labor cost covers all social security payments and payroll taxes associated with hiring anemployee, expressed as a percentage of the worker’s salary. The firing cost indicator measures the costof advance notice requirements, severance payments and penalties due when terminating a redundantworker, expressed in weeks of salary.The indicators on employment regulations are based on a detailed study of employment laws. Data arealso gathered on the specific constitutional provisions governing the two areas studied. To ensureaccuracy, both the actual laws and the applicable collective bargaining agreements are used. Finally, alldata are verified and completed by local law firms through a detailed survey of employment regulations.To make the data comparable across economies, a range of assumptions about the worker and thecompany are used. Assumptions about the worker include that he is a nonexecutive, <strong>full</strong>-time maleemployee who has worked in the same company for 20 years and is not a member of the labor union(unless membership is mandatory). The company is assumed to be a limited liability manufacturingcorporation that operates in the country’s most populous city, is 100% domestically owned and has 201employees. The company is also assumed to be subject to collective bargaining agreements in countrieswhere such agreements cover more than half the manufacturing sector and apply even to firms not partyto them.Most employment regulations are enacted in response to market failures. But that does not mean thattoday’s regulations are optimal. Analysis across countries shows that while employment regulationgenerally increases the tenure and wages of incumbent workers, rigid regulations have many undesirableside effects. These include less job creation, smaller company size, less investment in research anddevelopment, and longer spells of unemployment and thus the obsolescence of skills—all of which mayreduce productivity growth. Many countries err on the side of excessive rigidity, to the detriment ofbusinesses and workers alike.19
Page 1 and 2: China
Page 3 and 4: © 2007 The International Bank for
Page 5: IntroductionDoing Business 2008 is
Page 8 and 9: 9. In China, a new property law put
Page 10 and 11: Summary of Indicators - ChinaStarti
Page 12 and 13: Starting a Business in China: Entry
Page 14 and 15: 3. Steps to Starting a Business in
Page 16 and 17: The following table shows Starting
Page 18 and 19: 1. Historical data: Dealing with Li
Page 20 and 21: 13. Review of construction drawings
Page 24 and 25: 1. Historical data: Employing Worke
Page 26 and 27: The following table shows Employing
Page 28 and 29: 1. Historical data: Registering Pro
Page 30 and 31: 4. Benchmarking Registering Propert
Page 32 and 33: Getting Credit in China: Legal Righ
Page 34 and 35: 3. Benchmarking Getting Credit Regu
Page 36 and 37: Protecting Investors in ChinaOffici
Page 38 and 39: 3. Benchmarking Protecting Investor
Page 40 and 41: Paying Taxes: Tax Payable and Compl
Page 42 and 43: 3. Benchmarking Paying Taxes Regula
Page 44 and 45: Trading Across Borders: Importing a
Page 46 and 47: 3. Benchmarking Trading Across Bord
Page 48 and 49: Enforcing Contracts: Court Efficien
Page 50 and 51: 3. Benchmarking Enforcing Contracts
Page 52 and 53: Closing Business in China: Bankrupt
Page 54 and 55: 3. Benchmarking Closing Business Re
Page 56 and 57: APPENDICESStarting a Business in Ch
Page 58 and 59: - Appointment documents and identif
Page 60 and 61: Cost to complete:Comment:no chargeA
Page 62 and 63: 14 *Receive review of building draw
Page 64 and 65: Procedure1Request and obtain approv
Page 66 and 67: Comment:Procedure6The Shanghai Hous
Page 68 and 69: Procedure14Receive review of buildi
Page 70 and 71: Comment:No time limits apply for in
Page 72 and 73:
建建建建建建建建建
Page 74 and 75:
Employing Workers in ChinaEmploying
Page 76 and 77:
Registering Property in ChinaThis t
Page 78 and 79:
Procedure3(v) Photocopy of the iden
Page 80 and 81:
Protecting Investors in ChinaThe ta
Page 82 and 83:
Paying Taxes in ChinaThe table belo
Page 84 and 85:
Trading Across Borders in ChinaThes
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