Regulation of polluters through licensing is not paying off, according to the State Environmental Protection Administration (SEPA), due to ineffective legal measures to guarantee that all polluters are covered.

Peng Defu, with the SEPA's Pollution Control Department, said late last month that only 10 percent of the nation's polluters, those in regions where pollution reduction is judged to be most urgent, are required under the law to be licensed.

A large number of those who should be licensed aren't, and they continue to discharge pollutants without regulation, according to Peng.

Peng called on the country to revise its air and water pollution control laws so the licensing system can hold polluters more accountable.

Xia Guang, director of the SEPA's Policy Research Center, agrees. He said current laws relating to licensing are not comprehensive enough and too lenient.

China aims to strike a balance between protecting the environment and encouraging economic development, and the licensing scheme was introduced to minimize the worst effects of pollution without stifling growth.

Water polluters began to be licensed on a trial basis in 1988 and the system was extended to cover air pollution in 2000, when the country amended the Implementing Rules on the Law on the Prevention and Control of Water Pollution and the Law on the Prevention and Control of Atmospheric Pollution.

According to these two laws, licensing is only implemented in the country's key regions for pollution control: the "two controls" regions and "three rivers and three lakes" regions.

The "two controls" regions mean places where levels of discharged sulphur dioxide and acid rain are high. The "three rivers and three lakes" regions refer to those along and around the Huaihe, Haihe and Liaohe rivers and Taihu, Chaohu and Dianchi lakes, where water pollution is severe.

Peng said targeting these key regions impacted on less than 10 percent of polluting companies and organizations.

Environmental impact assessment, which is done before projects go ahead, is carried out relatively well, said Peng, but the licensing of polluters to help control polluters already in operation is not.

A crucial problem is thought to be the lightness of punishments. For example, the maximum fine for licensed companies discharging more sewage than permitted is only 50,000 yuan (US$6,000).

"Such an amount is too small to have an impact on the companies," Xia said.

"Under current laws, the licensing system can hardly be implemented effectively," agreed Peng.

(China Daily January 4, 2005)