Legal Scholars Urge Revisions to State Compensation Law to Boost Payouts

Li Jin spent 22 years in prison for a murder he didn’t commit [para. 1]. After being exonerated, he filed a state compensation application in July to the Sichuan Provincial High People’s Court, seeking 37.72 million yuan ($5.2 million)[para. 3]. This claim is based on China's State Compensation Law, enacted in 1995, which aims to compensate victims whose personal rights, such as freedom or property, have been infringed upon by the state[para. 3][para. 4].

From 1995 to 2023, Chinese courts awarded over 7.5 billion yuan to victims infringed upon by the state. The number of state compensation cases in 2023 was 17.55 times higher than in 1995, with the daily compensation for personal freedom violations increasing from 17.76 yuan to 436.89 yuan [para. 8]. Despite this, legal experts argue the calculation method for loss of freedom is unfair because it is based on an 8-hour workday while wrongful imprisonment affects 24 hours a day[para. 10]. Current compensation for personal freedom violations is 462.44 yuan per day, but legal professionals urge this rate should be at least three times higher and consider individual differences[para. 11]. Moreover, compensation for psychological damage has been criticized. The 2021 judicial interpretation increased the threshold from "no more than 35%" to "at a discretionary level of more than 50%" of the total compensation for personal freedom violations[para. 14]. However, Qu Zhenhong, an attorney who has represented over ten wrongfully convicted victims, insists this is insufficient due to severe psychological impacts suffered by victims like Liu Zhonglin and Jin Zhehong[para. 14][para. 15][para. 16]. The largest previous compensation for long-term wrongful imprisonment was 7.9 million yuan to Tan Xiuyi, which included 4.4 million yuan for imprisonment and 3.5 million yuan for psychological damage, though this was less than half of what he requested[para. 17]. Li Jin's compensation request includes an enhanced rate for the 8-hour workday and 150-300% for hours outside normal working time, alongside 110% for psychological damage[para. 18].

For property rights infringements, the law currently mandates returning or restoring property or compensating for the loss without specifying how to calculate the extent of the loss[para. 19]. Xue Zheng, a senior partner at Beijing Docvit Law Firm, noted that compensation for wrongful demolitions is typically less than lawful demolitions, creating a perverse incentive for forced demolitions[para. 20]. Prof. Jiang Mingan of Peking University Law School has called for more explicit guidelines on who should evaluate the extent of loss and suggested considering compensation for indirect losses, such as land value appreciation following confiscations[para. 21][para. 22].

Contact reporters Kelly Wang and editor Joshua Dummer are listed at the end for further correspondence [para. 23].