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According to Chinese media reports, in Beijing, most listings have been removed from Airbnb-style short-term rental platforms . A notice from the Beijing Municipal Commission of Housing and Urban-Rural Development stated that the city-wide short-term rentals will not be open for business for the time being. On August 22, short-term rental platforms were to remove “non-compliant properties” within seven days. As of August 29, most of the listings were removed from the rental platforms. An estimated 100,000 rentals were affected.

According to the notice, short-term rental listings may be restored after the rental operators provide documentation showing agreements among property management, homeowners associations, and other owners in the neighborhood and agreements with the public security authorities, among other requirements. It is more than challenging to meet these requirements. As a result, it is unlikely that most short-term rental units will be able to continue operating.

Analysts believe the authorities are tightening the control over people visiting Beijing. After the short-term rental industry collapse, people visiting Beijing will have to stay in hotels, where guests must register. Also, the higher cost of staying at hotels may make it harder for grievance petitioners and rights defenders to come to Beijing.

The statistics released by a short-term rental platform, Tujia, show that the total number of short-term rentals exceeded 630,000 in the first half of 2021, an increase of over 16 percent compared with 2020 (540,000 units), and a year-on-year increase of 2.9 times that of 2019 (160,000 units).

Sources:

1.) Netease, September 4, 2021
https://www.163.com/dy/article/GJ33V13D051492T3.html

2.) Radio Free Asia, September 1, 2021
https://www.rfa.org/mandarin/yataibaodao/jingmao/ql1-09012021062135.html

On August 30, 2021, China’s Ministry of Culture and Tourism issued a directive requiring literary and artistic workers to study a series of articles by the General Secretary of the Chinese Communist Party, Xi Jinping.

The directive was issued to address the current violations of laws, regulations, and moral failures in the entertainment business, to further strengthen the control of education and to cultivate and promote the core values ​​of socialism.

The first item in the directive is to “strengthen study and education.” Specifically, it refers to studying Xi Jinping’s series of important expositions on literary and artistic work in depth. The directive calls for a deep understanding that the cause of entertainment is an “important cause for the party and the people” and that the entertainment front is an “important front of the party and the people.”

On August 29, 2021, the CCP media, China Youth Daily, posted a commentary entitled “Everyone Can Feel  that a Profound Change Is Underway!” More than 30 state media at the central, provincial and municipal levels in China have since prominently re-posted the commentary.

The commentary calls China’s recent crackdown measures “profound reforms” or “profound revolutions.” From censoring entertainment stars to suspending Ant’s Initial Public Offering, to Alibaba’s fine of 18.2 billion yuan, to the investigation of Didi and to the “common prosperity” policy, all measures show that a profound reform or revolution is taking place in the economic, financial, cultural, and even political arena. A profound “revolution” or “revolution” is returning capital to the people, to the CCP’s original goal, and to socialism. Those who attempt to block this reform will be “abandoned.”

The commentary continues that this “profound reform” is to counter the “barbaric and ferocious attack” of the United States against China. The commentary implies that China’s capitalists are the “fifth column” of the United States in waging a color revolution in China. “The United States is imposing increasingly severe military threats, economic and technological blockades, financial strikes, political and diplomatic containment and the suppression of China.” “The United States is more aggressively waging a color revolution through the fifth column within China. If this time, we still have to rely on those big capitalists as the main force of anti-imperialism and anti-hegemony,” China will not need enemies to fight. “It will fall first by itself,” just like the Soviet Union back then. That’s why China is reforming the “capital circle” and the “entertainment circle.”

Sources:

1.) China’s Ministry of Culture and Tourism, August 30, 2021
https://www.mct.gov.cn/whzx/whyw/202108/t20210830_927427.htm

2.) People’s Daily, August 29, 2021
http://politics.people.com.cn/n1/2021/0829/c1001-32211523.html

3.) Radio France Internationale, August 31, 2021
https://tinyurl.com/6p54dc87

The owners of private schools in China have been forced to turn over their facilities to the state.

On August 25, 2021, the Ministry of Education of the Chinese Communist Party (CCP) responded to questions from the media regarding the “Notice on Regulating the Establishment of Public Schools or Participation in the Establishment of Private Compulsory Education Schools.” The Ministry of Education stated that schools must cooperate with the CCP and carry out education reform as an important political task. Under the new regulation, private schools will be either handed over to the state or cease their operation within two years. The CCP’s suspension of private schools appears to be politically motivated to strengthen ideological control and amounts to misappropriating private assets.

The fallout from the education reform is rippling across the country.

On August 25, 2021, Yingshang School in Anhui Province notified its students’ parents that it closed its doors. In 2020, the school was a flagship in Yingshang County’s investment promotion campaign. The Jiangsu Zhufeng Education Group established it and invested in it. It was to provide elementary, junior high, and high school education. The campus has a construction area of ​​130,000 square meters and can accommodate 6,300 students. The school year was scheduled to start at the end of August.

Recently, the Huaiyang No. 1 Senior High School in Henan Province announced that the school will be donated in its entirety to the local government to “repay society.” It had a teaching staff of 1,300 and more than 20,000 students. The Henan Provincial Department of Education approved the school in 2002 and started to admit students in 2005. The school was touted as a model high school in Henan Province.

Jiaxiang Foreign Language School in Sichuan Province was turned over to the local government and will operate as a public school. It is the first compulsory education school in Sichuan that was converted from a private school to a public school after the implementation of the “Notice on Suspending the Approval of the Establishment of Private Compulsory Education Schools” that the Sichuan Provincial Department of Education had issued on June 11, 2021. The Notice requires all local governments to suspend the approval of private schools in the compulsory education stage.

In Hunan Province, on June 22, 2021, the Department of Education issued a notice on regulating private compulsory education. It requested that private junior high and primary schools reduce their students to below five percent of the total compulsory education students. It amounts to a reduction of approximately 364,000 students. Further, Hunan Province will no longer approve new private compulsory education schools.

In Jiangsu Province, the CCP Education Work Leading Group issued a directive stating that it will no longer approve new private compulsory education schools. The order sets the goal of reducing students at private compulsory education schools to below five percent of the entire compulsory education students within two or three years.

Sources:

1.) The Government of the People’s Republic of China, August 25, 2021
http://www.gov.cn/zhengce/2021-08/25/content_5633202.htm

2.) Zhihu, August 3, 2021
https://zhuanlan.zhihu.com/p/396201138

On August 20, 2021, the Standing Committee of China’s National People’s Congress adjourned its meeting. Standing Committee Member Tan Yaozong from Hong Kong stated to Hong Kong 01 that the Standing Committee did not vote on the draft for incorporating the China Anti-Foreign Sanctions Law (June 210, 2021) into Annex III of the Basic Law of the Hong Kong Special Administrative Region (HKSAR) of China.  

The Basic Law is a national law of China that serves as the de facto Hong Kong constitution. With 160 articles and three annexes, the Basic Law was enacted under the Constitution of China to implement the Sino-British Joint Declaration and went into effect July 1, 1997, in Hong Kong. An affirmative vote by the Standing Committee on August 20, 2021, would have extended China’s Anti-Foreign Sanction Law to Hong Kong by adding it as Annex III of the Basic Law.

According to Tan, the Standing Committee deliberated on the proposal to add Annex III to the Basic Law, but the chairman’s meeting decided not to vote for the time being but rather, to continue to study related issues.

A few days earlier, Tan said that on August 20, 2021, the Standing Committee would discuss and consider including the Anti-Foreign Sanctions Law in Annex III of the Basic Law. Tan Yaozong expressed that the draft to be discussed was relatively simple. It only required that the Anti-Foreign Sanctions Law be included in Annex III of the Basic Law and that the SAR government establishes relevant systems. It would not discuss specific implementation details in Hong Kong and has not set a legislative timetable for Hong Kong.

On June 10, 2021, the 29th meeting of the Standing Committee of the 13th National People’s Congress passed the Anti-Foreign Sanctions Law. The Chinese Communist Party intends the law to oppose foreign sanctions against China, counter foreign discriminatory measures, and respond to the “long-arm jurisdiction” of the United States.

According to the Anti-Foreign Sanctions Law, China’s State Council may deal with measures such as denial of visa, denial of entry, deportation, seizure and freezing of property in China, and prohibiting or restricting doing business in China.

Hong Kong economist Luo Jiacong said that more than 200 banks are currently in Hong Kong, and more than 80 percent of them are foreign banks. If China extends the Anti-Foreign Sanctions Law to Hong Kong, it is estimated that foreign banks will choose to leave Hong Kong because they will not give up their U.S. dollar business. 

Analysts warned that the surprising decision on August 20 to defer extending the Anti-Foreign Sanctions Law to Hong Kong does not signal any retreat or U-turn on retaliatory steps against the West. Instead, the CCP may opt for a more tailored retaliatory approach in order not to jeopardize Hong Kong’s financial hub.

Sources:

1.) Hong Kong 01, August 20, 2021.
https://tinyurl.com/4s3n9yvm

2.) Radio Free Asia, August 13, 2021
https://www.rfa.org/mandarin/yataibaodao/gangtai/ec-08132021082231.html

3.) Anti-Foreign Sanctions Law of the People’s Republic of China, June 10, 2021
http://www.npc.gov.cn/npc/c30834/202106/d4a714d5813c4ad2ac54a5f0f78a5270.shtml

On August 17, Xi Jinping, in his keynote speech at the tenth meeting of the Central Finance and Economics Committee, highlighted the need to redistribute wealth and strengthen the “regulation and management” of high-income earners.

After cracking down on Chinese technology giants, financial companies, and the after-school training industry, the CCP is now targeting “high-income earners.”

According to the People’s Daily, Xi told the CCP leadership that there must be a mechanism to redistribute wealth, to promote “social equality,” to establish basic system arrangements for the coordination of primary distribution, redistribution, and third-time distribution; to intensify efforts and to improve the accuracy in taxation, social security, transfer payments,  and related areas.;  …  to rationally regulate high income; ban illegal income; … and to promote social equality.”

It is necessary to “strengthen the regulation and adjustment of high incomes, …, rationally regulate excessively high incomes, and encourage high-income groups and enterprises to return more to the society. We must clean up and standardize unreasonable income, rectify the order of income distribution, and resolutely ban illegal income.”

Xi Jinping’s “common prosperity” is regarded as the key for the CCP to maintain its power. “The meeting emphasized that common prosperity is the prosperity of all people, ‘not the prosperity of a few people.’ We must take the promotion of common prosperity for all the people as the focal point for seeking happiness for the people, and constantly consolidate the foundation of the Party’s long-term governance.”

At this meeting, the CCP did not provide specifics on the criteria for “high-income earners.” Xi Jinping’s focus on wealth redistribution is closely related to the broader economic goals of the CCP. In recent months, in the name of curbing financial risks, protecting the economy, and fighting corruption, the CCP has issued a number of regulations and directives against industries such as technology, finance, and education. Xi Jinping’s redistributing wealth and realizing “common prosperity” is believed to be behind the CCP’s latest regulatory crackdown on these industries.

Source: People’s Daily, August 18, 2021.
http://jhsjk.people.cn/article/32197470?isindex=1

On August 14, China’s Ministry of Education approved the termination of 286 China-foreign cooperative education institutions and programs at the undergraduate level and above.

The list includes the London Metropolitan University, New York University, and other well-known universities that have been cooperating with China in running schools. The majority of the closed projects involve disciplines of engineering, economics, language, art, and the social sciences. These include undergraduate education programs in information engineering, automation, and other areas that were jointly organized by the Harbin University of Science and Technology;  the London Metropolitan University; and master’s degree programs in China Social Service Management jointly organized by the East China University of Science and Technology, the Hong Kong Polytechnic University, and others.

Late last month, China published a plethora of regulations in a sweeping overhaul that bans companies that teach the school curriculum from making a profit, raising capital, or going public.

Companies that teach school subjects can no longer accept foreign investments.  In addition, publicly listed firms will no longer be allowed to raise capital in any stock markets to invest in businesses that teach classroom subjects. Outright acquisitions are now off-limits.  Vacation and weekend tutoring related to the school syllabus are also forbidden.

Sources:

Sina.com, August 11, 2021
https://news.sina.com.cn/o/2021-08-11/doc-ikqcfncc2289112.shtml

Sina.com, July 25, 2021
https://finance.sina.com.cn/china/2021-07-25/doc-ikqciyzk7469579.shtml