Your FAO may or may not be spinning you a story.
It is true that on Monday, March 14th, 2011, the Chinese government passed the Twelfth Five-Year Plan which proposes changes in many areas.
It is also true that it is now difficult, even impossible in certain places, to get licenses, start a new business, etc. because local government officials are waiting for their implementing instructions from above.
I have heard it will be about two months from the passing of the new Five-Year Plan until the changes have fully trickled down to the lower levels.
There may be officials in a few places who would piggyback on this delay to stall completing requested duties, but you'll probably never be able to discern which instance you are dealing with.