Debtors in the city will soon be forbidden from purchasing luxury goods, according to a regulation drafted by the legal commission of the Shenzhen Municipal People's Congress, yesterday's Shenzhen Special Zone Daily reported.

The draft regulation will be submitted to the standing committee for approval early next year, the Daily report said.

Buying and using luxury goods and services while owing a huge debt is contrary to the spirit of social equity, the report said, which has given rise to the need for restrictions on debtors' indulgences.

The regulation will forbid debtors from spending money in bars, nightclubs and star-rated hotels, and from spending more than the city¡¯s low-income subsidy threshold of 361 yuan (US$45) at one time. Debtors will also be forbidden from purchasing real estate and expensive goods like cars.

Debtors violating the regulation will be fined, the report said.

The draft stipulates the procedure for debtors to report their assets.

Creditors are allowed to place advertisements in newspapers and in public areas offering rewards to people who report hidden assets of the debtors. They are also encouraged to publish the names of debtors in newspapers.

The draft prohibits debtors from bidding for government projects. It also stops debtors from leaving the country.

The draft requires the local courts to make public their efforts in settling debts, such as carrying out actions like property confiscation, evaluation and auction.

Police, banking, securities, insurance, tax and planning authorities are required to assist in the process of debt clearance, the draft says.

Editor: Donald