BEIJING — A new national regulation to take effect next year signals a milestone in China's bid to explore institutional improvement for a better business environment.

The regulation, released by the State Council on Oct 23, will become effective from Jan 1, 2020. Drawing on past experience and aligning with advanced international levels, it specifies the principles and directions for fostering a stable, fair, transparent and predictable business environment.

"The promulgation of the regulation marks a new phase in the country's effort to create a law-based business environment," said Liu Zhe, vice-president of think tank WANB Institute, adding the direction and framework of optimizing business environment have been set.

Solidifying reform measures in recent years, the regulation targets weak links in China's business environment and addresses difficulties facing market entities.

The government will protect market entities' management autonomy, property rights, and other legitimate rights and interests, and promote the establishment of a unified national platform for safeguarding their rights and interests, according to the regulation.

It also clarifies rules regarding the faster establishment of enterprises, equal market access, solid implementation of tax and fee reduction policies, and easing financing difficulties.

"It's a systematic project to optimize the business environment, and providing legal and institutional safeguards is a significant part," said Zhang Yaobo, an official with the Ministry of Justice.

According to Zhang, the regulation shows China highly values the improvement of the business environment and is determined to continue its efforts, which will stabilize market expectations and reinforce the confidence of market entities.

One of the highlights of the regulation is tighter constraints over excessive intervention by administrative power in business operations, said Zhang Haibing, vice-president of WANB Institute.

Premier Li Keqiang, who presided over a State Council executive meeting earlier this month that adopted a draft of the regulation, described it as "a key measure for tackling the downward economic pressure and attracting more foreign investment."

To support economic growth, the Chinese government has resorted to bolder reforms instead of massive stimulus, reducing corporate burdens, transforming government functions and cutting red tape.

In the first eight months, tax and fee cuts exceeded 1.5 trillion yuan (about $212 billion), further easing the burden on enterprises.

Thanks to an improved environment, around 19,600 new enterprises were registered on average every day in the January-August period.

China advanced to a global ranking of 31 this year, up from 46 last year, in the World Bank's latest annual doing business study and was on the list of top 10 improvers for a second consecutive year.

There remains a lot of room for further improvement in lowering institutional transaction costs for enterprises, according to Pan Helin, a senior researcher with think tank Pangoal Institution.

"Providing the legal support for optimizing the business environment will play an important role in increasing market vitality and promoting economic growth," Pan said.