A "three-no" speedboat (unregistered, unlicensed, and uninsured) from mainland China crossed into the waters near Kinmen on February 14, 2024, and was pursued by Taiwan's Coast Guard personnel. The boat engaged in high-speed evasive maneuvers, resulting in it capsizing, with four people falling overboard, leading to two fatalities. (Provided by the Kinmen-Matsu-Penghu Branch of the Taiwan Coast Guard Administration)
[People News] Recently, the phenomenon of "distant fishing" in China has attracted frequent attention. This term does not refer to traditional ocean fishing but rather metaphorically describes actions where cross-provincial law enforcement agencies seal, freeze, or even misuse criminal measures to target corporate assets in other provinces, ostensibly for enforcement but actually to profit illicitly. An internal report from Guangdong Province shows that cross-provincial enforcement has harmed nearly 10,000 private enterprises within the province.
According to Radio Free Asia, Chinese provincial public security departments, in order to address fiscal problems, have employed cross-provincial enforcement to freeze or confiscate funds from private business accounts. This practice, referred to by legal circles as "distant fishing" enforcement, together with "criminalizing debts," is seen as a dual scourge damaging private enterprise.
In an interview with Radio Free Asia on Tuesday, senior financial commentator Cai Shenkun stated that such "distant fishing" and cross-provincial enforcement reflect severe fiscal issues across regions: "Local government finances are no longer sustainable. This ‘distant fishing’ tactic is the local government acting shamelessly—every government has tasks, and local finances can’t even cover salaries anymore. The whole government machine is failing. These enforcement agencies also have quotas; they need to get money, tax agencies need to get money, and funds from private business owners are nearly exhausted."
A recent exposure in Guangdong’s Internal Affairs Report points out that in recent years, cities in the Pearl River Delta region, including Shenzhen, Guangzhou, and Dongguan, have become hotspots for cross-provincial enforcement. Notably, in 2023 alone, nearly 10,000 private enterprises in Guangzhou have faced cross-provincial freezes, with most cases showing signs of profit-driven enforcement. For instance, in the case of Yi Health Group, the initial case amount was only about 600,000 yuan, but the public security bureaus in Jiaozuo and Shangqiu, Henan Province, mobilized over 1,600 police officers across provinces, freezing Yi Health’s related accounts totaling up to 758 million yuan. This led to hundreds of Yi Health employees being questioned, multiple accounts frozen, the company’s Hong Kong listing plans suspended, and even risked bankruptcy.
Guangdong lawyer Mr. Zeng told this platform that enforcement agencies from other provinces target Guangdong because its private economic environment is relatively better than other provinces: "China’s economy heavily relies on Guangdong. While Guangdong authorities also go after private enterprises, it’s far from as severe as in the inland. Now there’s no need for local action; many private businesses are already on their last legs. Guangdong now protecting its territory is natural. Now any business with money is ‘targeted,’ with people waiting to grab assets and funds."
Only Two Districts in Guangzhou Can Pay Salaries on Time
Mr. Zeng stated that even in economically developed Guangzhou, government finances are facing serious issues. He disclosed: "Even in Guangzhou, as I understand, only two district governments can pay salaries independently; the others have lost this capacity. These are Huangpu and Tianhe districts. Most other districts need support from other districts, and indeed, the Guangdong province is extremely short on funds."
Guangdong’s New Measures to Curb Cross-Provincial Enforcement
According to the Internal Affairs Report, Guangdong Province has already started pushing back, introducing new measures to limit arbitrary cross-provincial enforcement. For instance, Guangdong’s Public Security Bureau and Local Financial Regulatory Bureau have established a coordination mechanism, stipulating that if there is a need to freeze Guangdong private enterprise accounts, it must be approved by the provincial Public Security Bureau to prevent external law enforcement agencies from freezing accounts casually. Additionally, regarding operational assets, unless there is direct evidence showing involvement in a case, they must not be arbitrarily seized to reduce the impact on normal business operations.
Commenting on this, Cai Shenkun, who has lived in Guangdong for many years, noted that even during its economic boom, Guangdong governments did not treat private enterprises kindly: "When the economy was strong, every province had various ways to crack down on its private enterprises. Now they see others coming to Guangdong to grab what’s left, and Guangdong has nowhere left to go for funds. Guangdong’s economy this year is definitely struggling, so now it has to resist."
Countermeasures in Zhejiang, Yiwu, and Elsewhere Against "Distant Fishing"
Guangdong’s countermeasures are not isolated. A certain police station in Hangzhou, Zhejiang Province, has previously issued notices to prevent arbitrary cross-provincial intervention in local enterprise affairs. Moreover, Yiwu City issued a Case Handling Reminder in 2020, cautioning nationwide law enforcement agencies to avoid excessive or selective enforcement on private enterprises. Zhejiang Xinhu Group’s case also highlights the dangers of "distant fishing"-style enforcement, as the company suffered significant losses when a court in Hubei Province revoked its mining stock ownership due to a previous shareholder bribery case, resulting in losses of hundreds of millions and sparking widespread controversy.
Beijing Seminar Addresses Profit-Driven Enforcement Issues
On October 14, a seminar on preventing and managing profit-driven enforcement was held in Beijing. Experts pointed out that excessive enforcement by law enforcement agencies, aiming to achieve seizure revenue or local fiscal targets, has already threatened the development of private enterprises. They suggested establishing hierarchical jurisdiction and joint approval mechanisms to limit arbitrary cross-provincial enforcement.
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