What does Chinese civil-military integration mean for the courts?

The press outside of China has recently focused on China's civil-military integration. An article in the April 20 edition of Hong Kong's South China Morning Post (SCMP) had the following comments. (More serious -- and eminently readable -- analysis of the program can be found here):

China’s military further opened its research and development programmes to private companies, inviting them to take part in projects worth an estimated 6 billion yuan (US$870 million or HK$6.78 billion), state media reported.....This past January, he [Xi Jinping] authorised the creation of the Central Commission for Integrated Military and Civilian Development to coordinate policies and decisions towards that end.But obstacles remain, with a major one being trust, according to He Qisong, a defence policy specialist at the Shanghai University of Political Science and Law... “When it comes to key technologies in the defence industry, private companies can hardly gain any trust from the army in matters involving secrecy,” He said. Retired PLA major general Xu Guangyu said new laws were needed to clarify obligations of businesses handling classified work, as well as to define the commercial benefits they could reap from cooperation with the military.

But it appears neither the analysts the SCMP contacted nor the newspaper itself did any further homework. If they had, they would have uncovered an April 11 article on one of the People's Liberation Army websites, that republished an article from a Wechat public account. For those not familiar with China, Wechat is the most popular social media platform, that permits blog-like writing in what are called public accounts. The article, titled "Civil-Military Integration is Inadequate and What do You Know About the Countermeasures," drills down on the underlying legal problems. The author has a Ph.D. in law and formerly taught at the National University of Defense Technology in Changsha. The author illustrates the difficulties of implementing high level reform in China when the underlying legal infrastructure is unchanged. The article points to underlying issues that I have previously discussed on this blog. Those include:

1. gaping holes in the legislative framework; 
2. when legislation exists, it conflicts with other legislation; 
3. lack of effective dispute resolution.

 On the substantive law issues:

There is a bias and even conflict between existing military regulations and national laws and regulations. Some military legislation sets up a self-enclosed, self-contained system which does not coordinate with or supplement the Contract Law, Arbitration Law, Government Procurement Law, Product Quality Law and "business scope registration management regulations" and other relevant laws and regulations. For example, the "Provisional Regulations of the People's Republic of China Private Enterprise" "Individual-owned Enterprise Law" "Partnership Enterprise Law" "Company Law" etc. clearly stipulate that enterprises must not engage in military industry....Concerning civil-military integration, there are many "red head documents," [official Party/government /military documents], but those policy documents cannot play the role of broad, long-term, stable, and highly efficient legal norms. There are few legal norms, primarily administrative regulations and departmental rules, with a relatively low legal status, ineffective, poorly coordinated, with weak binding effect, and are not fit for the needs of the further development of civil-military integration.  At the same time, many regulations and documents promoting civil-military integration are relatively highly classified, making it difficult to make them public, but not helpful for entities wanting to participate in national defense and military matters, difficult to effectively protect one's rights, but making it hard for these regulations to be actually implemented.  

Dispute resolution:

Currently, there are situations involving the procedure for the resolution of military-related civil disputes in which the military courts cannot accept the cases, nor can the local [civilian] courts or arbitration institutions. According to the relevant judicial interpretation of the Supreme People's Court in 2012 [previously mentioned on this blog], the military court only has jurisdiction over four types of civil disputes, and does not hear civil disputes related to civil-military integration. In addition, the local courts or arbitration institutions face the problem in trying or arbitrating civil disputes that the military has defense judicial immunity, so even after the trial or arbitration, the decision or arbitral award cannot be enforced. As a result, local courts and arbitration institutions do not want to accept civil-military civil disputes. At present, civil-military disputes, including civil-military integration are basically resolved through mediation or conciliation, but the civil-military civil disputes in the development of military integration are complex and varied, and take diverse forms. If the dispute cannot be resolved through legal proceedings, and cannot achieve the goal of fair, just and efficient [dispute resolution], it fails to meet the demands of a law-based economy based on the market economy.

So, although the grand policy has been announced and publicized, on the ground implementation appears to another story.  The silos between the military and civilian economy continue to exist. What business will voluntarily do a deal if no court or arbitration institution can hear a dispute if the deal goes bad?