Beijing’s draconian license plate limits have a stimulating effect on the creativity of Beijingers. To skirt the new rules, complex schemes are being devised. Beijing’s courts are turned into accessories of the fraud. According to China Daily, the scheme goes like this:
The seller and buyer of a used car invent a debt the vehicle’s seller supposedly “owes” the buyer for which the car is “collateral”. Both go to court. The court orders the “debtor” (the car’s seller) to hand over the car to the “lender” (the car’s buyer). Along with the transfer of the car’s ownership comes the already registered license plate. Bingo.
Under the new rulings, registered owners of a car can buy a new one without being submitted to the license plate limitations. However, the plate does not transfer with the used car. As a result, Beijing’s second had car market pretty much collapsed in January. In the tough rules is an exception for the registration of cars’ ownership transfers through court adjudications, or property transfers related to marriages and inheritances. False marriages with car owners will probably rise also. Adoption and subsequent death might prove as too complicated.
“Such stipulations provide loopholes for used car buyers to avoid legitimate channels,” said Zhu Xingdong, a senior staff member of the people’s court of Beijing’s Huairou district. He said it’s tough for the courts to determine that the debts are legit, because the two parties have colluded in supplying watertight debt and reimbursement agreements. “If it is found to enable people to get around the lottery to obtain license plates, there will be a surge in these cases,” Zhu predicted.