Market equilibrium takes time, significant time in a market with annual contracts.

Next month is the first impact of the new regulations. There will be fewer foreign teachers in High Schools and Universities.

Ironically, there will probably be MORE illegal FTs at private Language Schools, as they refuse to accept diminished profit and increase pressure on recruiters to generate bodies.

My opinions about this situation have already been stated: http://www.eslteachersboard.com/cgi-bin/forum/index.pl?read=115517

The few students that would have had a qualified committed FT that chooses not to teach in China will likely experience a minor loss in the quality of their oral English competency. The many students that would have been confused and dismayed by a substance abusing Western social refugee will be spared that ordeal.