(Writes through)

By Benjamin Kang Lim and Guo Shipeng

BEIJING, April 24 (Reuters) - China unveiled rules on Tuesday promising to expose its secretive government to greater transparency in an effort to fight graft and misrule -- but within strict limits.

The regulations, signed by Premier Wen Jiabao, will empower citizens to demand information about government finances and economic plans, statistics, land development, environmental regulations and many other policies.

A government official portrayed the Regulations on Open Government Information as a plank in government efforts to create a "harmonious society" -- President Hu Jintao's doctrine to curb social tensions caused by a yawning wealth gap and corruption.

"It effectively ensures the people's right to know," Zhang Qiong, vice minister of the cabinet's Legislative Affairs Office, told a news conference. "It helps to contain and prevent corruption institutionally and at its roots."

The rules take effect from May 2008, three months before the Beijing Olympics. They will ensure that "citizens, corporations and other organisations" can request government information free of charge according to their need in business, life or research.

Key areas where the government should swiftly release information include "sudden public incidents", a reference to protests, accidents and epidemics such as the 2003 SARS outbreak which the government initially tried to cover up.

Information about land seizures and housing demolitions -- explosive issues in recent years often involving behind-the-door dealings between officials and developers -- is also targeted.

STATE SECRECY

Citizens will have the right to appeal and ultimately take officials to court if legitimate requests are rebuffed.

"Officials will have to exercise more self-discipline with the regulations in place. There will be less under-the-table dealings," said Mao Shoulong, professor of public administration at the People's University of China.

But in a sign that the ruling Communist Party does not want a free-for-all, the rules offer a broad opt-out for officials, saying that information released "should not harm state security, economic security or social stability".

State secrecy bureaux will have a final say in whether or not to publish dubious information, the rules stated.

The country's definition of state secrets is notoriously broad. It is the world's top jailer of journalists, with over 30 in prison, many for stealing state secrets after reporting official misdeeds or speculating about leadership changes.

The government has sought to curb the flow of information to avoid social unrest threatening its rule. It tightly censors the Internet, blocking access to many overseas sites, and domestic media regularly receive directives on what not to publish.

"It is a gradualist and pragmatic piece of legislation. There were some compromises made to accommodate reality, not idealism. said Mao, the professor.

But with the market economy growing rapidly and bursting through state constraints, the Communist Party faces citizens and investors increasingly eager to escape and sometimes directly challenge deeply entrenched top-down political controls.

Wen and other leaders have promised incremental political reforms to meet those rising demands.

From Jan. 1, foreign journalists were given greater room to freely roam and report in the lead-up to the 2008 Olympics, and in 2005, China announced that it would no longer regard the death toll in natural disasters as a state secret. (Additional reporting by Chris Buckley)

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