According to the new regulation, "no organization or individual is allowed to accept body donations except medical institutes, medical schools, medical research institutes and forensic research institutes," Xinhua news agency said.

Transport of bodies to and from China would have to be approved by the civil affairs departments, customs and quarantine authorities, it said.

At the beginning of July, the first law concerning the donation of organs and the conduct of transplant operations came into effect in order to regulate a sector which had become a lucrative but chaotic industry in recent years.

A dire shortage of donated organs has fueled what critics inside and outside China say is a rampant black market.

The underground industry meets demand not only domestically but from patients overseas.

To meet the rising demand, hospitals have been regularly accused of secretly taking organs from road accident victims and other dead patients without telling family members.

Sometimes hospitals buy organs from the deceased person's family, but it is rare for families to consent as they traditionally want to keep the body intact.

Organs of executed prisoners are also harvested and sold to hospitals without consent, according to human rights groups and media reports.

Earlier this month a former Canadian cabinet member and a human rights lawyer issued a report alleging China harvested organs from unwilling live prison inmates, mostly Falungong practitioners, for transplants on a large scale.

The Chinese authorities have several times refuted the charges, denouncing them as part of a smear campaign by Falungong, a sect which Beijing banned in 1999 as an "evil cult".

About 20,000 transplants are conducted in China each year out of at least two million Chinese patients who need them, according to Xinhua.

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