ZHU Dan: Institutional Innovation and Governance Insights in the Era of the Digital Economy

The "Private Sector Promotion Law of the People's Republic of China" stands as a milestone legislation in China’s digital economy governance. It constructs a comprehensive financial adaptation system covering the entire enterprise lifecycle, innovatively breaking through the traditional "risk-reward" model constraints. This creates a dynamic support mechanism across research and development, growth, and maturity stages, complemented by a dual-track risk-sharing framework of "bank plus guarantee" and multi-tier capital market channels, serving as a practical model for science and technology finance. In the realm of factor marketization reform, the law pioneers the "Three Principles of Data Elements"—namely sharing, inclusiveness, and security. It addresses the three-fold challenges of data property rights recognition, circulation, and pricing through public data authorization and operation mechanisms, as well as data trust systems, thereby promoting reforms in the structural separation of data property rights. The innovation in incentive mechanisms employs a punitive compensation system for intellectual property rights infringement combined with equal participation in standard-setting processes, creating a closed loop that both strengthens protection of innovation and prevents spillover of benefits. This approach positions private enterprises as key players in setting technological standards. To address systemic issues such as institutional friction between data openness and trade secret protection, residual local protectionism, and the balancing of financial innovation, the law proposes a three-layer governance framework comprising tiered data authorization, cross-regional circuit courts, and fault-tolerance funds. The global significance of this legislation lies in its capacity to transcend zero-sum data hegemonies, establishing a regulatory paradigm where factor marketization and innovation incentives coexist. This provides a legal model for digital transformation in developing countries. Looking ahead, China is poised to achieve three major outcomes: establishing an "Asian Pricing Center," developing a standards cooperation network along the "Belt and Road" initiative, and leading in artificial intelligence governance. Through pathways such as negative list management and building a Digital Silk Road, China aims to assert greater influence in shaping global digital economy rules.

（The above content is excerpted and translated from an article published by ZHU Dan, a researcher at the National Academy of Development and Strategy, Renmin University of China, on the Zhonghongwang, titled “Implementation of the Private Sector Promotion Law of the People's Republic of China: Institutional Innovation and Governance Insights in the Era of the Digital Economy.”）

Linkage: https://www.zhonghongwang.com/show-257-402147-1.html