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Clifford Chance

Briefings

China proposes new Foreign Investment Law

6 February 2015

A major change in the regulation of foreign investment in China is underway. On 19 January 2015, the Ministry of Commerce (MOFCOM) of the People’s Republic of China (China) issued a draft Foreign Investment Law (Draft) for public consultation. The content of the Draft marks a significant move of MOFCOM to relax its regulation on foreign investment and streamline the current fragmented regulatory framework. If the Draft is passed, it will replace the existing set of laws and regulations that govern the formation and operation of foreign-invested enterprises (which includes foreign-invested equity and cooperative joint ventures as well as wholly foreign-owned enterprises) in China (FIE Laws), some of which have been in place for almost 30 years.
The content of the Draft marks a significant move of MOFCOM to relax its regulation on foreign investment and streamline the current fragmented regulatory framework. At the same time, MOFCOM is tightening its scrutiny on foreign investments in "restricted" sectors.
This briefing looks at the background of the Draft and discusses the groundbreaking changes that it introduces to the regulatory framework on foreign investment.

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China proposes new Foreign Investment Law

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