Culture ministry officials in Beijing have disbanded a group which set up what was billed as the Chinese equivalent of the Nobel Peace Prize, scrapping the prize, which was only awarded once, ahead of the December 2010 award ceremony in Oslo for jailed dissident Liu Xiaobo.
The organizers of the Confucius Peace Prize, who awarded the prize to former Taiwan vice-president Lien Chan in his absence, two days ahead of Liu's controversial award, have now been told by the ministry that they lack official permission to promote the event.
The Beijing-based Association of Chinese Local Art said the group that had organized last year's prize has been disbanded.
The prize has now been scrapped, and this year's prize will no longer be offered, the group said without giving a reason.
Among the nominees for this year's award, announced at a press conference earlier this month, were the Beijing-backed Panchen Lama and Russian Prime Minister Vladimir Putin.
Liu's 2010 Nobel prize was awarded in absentia to Liu Xiaobo, who was represented at the ceremony by an empty chair, sparking a furious reaction from Beijing.
The award sparked a nationwide clampdown on anyone having a connection with Liu or the Charter 08 blueprint for political reform, which he co-authored.
Chinese police imposed tight restrictions on Liu's immediate family, along with a number of prominent rights activists linked to the jailed dissident.
Beijing stepped up pressure on political activists around the country when Liu, currently serving an 11-year jail term for subversion, was named the Nobel prize recipient.
Last year's Confucius Prize was accepted by an unidentified small girl, as Lien Chan was unable to make the trip to Beijing.
Lili Yang of the U.S.-based Laogai Research Foundation said the prize had always been viewed as somewhat ridiculous.
"This prize has been tainted with politics since its inception," she said. "Its originators wanted to counter the award of the Nobel Peace Prize to Liu Xiaobo last year."
But Yang said the prize had struggled to find an identity beyond that.
"It was being hung on the same peg with Hu Jintao's ideas for promoting social harmony and so forth," she said. "Too bad that they have bungled everything they have done in the past couple of years."
Reported by Xi Wang for RFA's Mandarin service. Translated and written in English by Luisetta Mudie.