Hearty welcome to online judicial auctions

Two local courts in Zhejiang province tried out holding online judicial auctions on July 1 without inviting auction companies to take part in them, says an article in 21st Century Business Herald. Excerpts:

The China Association of Auctioneers responded to the test by saying that it violated the Supreme Court's rules on judicial auctions, which require judicial auctions to be conducted by qualified auctioneers.

Statistics suggest that 70 percent of the instances in which the courts have committed illegal deeds pertain to the carrying out of sentences in civil cases. Of those, 70 percent happened in the auction process.

So corruption and clandestine operations have already become a serious problem for "legal" auctions conducted by registered auctioneers.

The purpose of holding judicial auctions is to repay creditors. If having them take place online can give the public more opportunities to monitor the proceedings and protect creditors' legal interests, then the practice should be encouraged.

Yet, online judicial auctions should also be closely supervised, for technology also offers opportunities for misuse.

If the China Association of Auctioneers cannot ensure that the older form of judicial auction conducted by registered auctioneers is cheaper, more efficient and more transparent than online auctions, then it will certainly by replaced by the online variety.

In fact, auction companies have also tried to hold auctions on their own websites. But such a practice does not eliminate corruption or reduce the cost of auctions.