CAR owners in Shanghai will have the chance to bid for car plates more fairly as the municipal government adopts new plate auction rules this month.

The first monthly car plate auction this year will be on January 12, the Shanghai International Commodity Auction Co, the organizer of the monthly event, announced.

About 16,000 licenses, double the number for sale in December, will be put up for auction with the city government offering the February allotment at the same time because of the Lunar New Year which falls on February 7.

The new rules, designed to help curb the soaring prices, include two bidding periods and having offers from other bidders being made public for the first time - a move that will help bidders set their own prices rather than relying on information provided by car dealers.

All the bidders will have to make their first offer between 10am and 11am and can then change their bids twice up to the 11:30am deadline.

During the auction, the lowest successful bids and the number of participants will be available on the Website, hotlines and billboards in the bidding hall in Anting, west Shanghai's auto town.

The new rules have given would-be car buyers a great deal of confidence although car dealers paint a different picture.

One buyer, named Qian, thought it will be a good chance to buy a plate at a lower price because many people will take advantage of the new rules to put in low bids even if they are unfamiliar with the system.

Shen Gang, a Mercedes-Benz dealer, said prices are unlikely to fall this month because the demand for car number plates for private use remains very high.

The new rules are part of the government's efforts to improve the auction system and slow the surge in prices.

Shanghai is the only city on the Chinese mainland to issue plates by auction and the average price has increased fivefold over the past seven years.

The new auction system was tested briefly last month and then the lowest successful bid dropped 3,800 yuan (US$520) to 50,000 yuan, the first decrease for six months.

However, the average successful bidding price continued to climb by 1,725 yuan to hit a record high of 56,042 yuan - half the price of a Volkswagen.

The government also reiterated its stance to further develop public transport including building more Metro lines and promoting bus use.

It is also said the city is working on a congestion charge which is expected to replace the existing auction system probably by the year 2010.