Clifford Chance

China's New Draft Foreign Investment Law – What are the Implications for Businesses?

29 January 2019

China has published a draft foreign investment law ("2018 Draft FIL") which, if it comes into force, will further encourage foreign investment.  If passed into law, the 2018 Draft FIL will replace the Sino-Foreign Equity Joint Venture Law (中外合资企业法), Sino-Foreign Cooperative Joint Venture Law (中外合作企业法) and Foreign Enterprise Law (外资企业法) (the existing main statutes regulating foreign invested entities ("FIEs") in China, all initially promulgated during the 1980s). It is commonly perceived that the current law in this area needs to be updated in light of dramatic social and economic changes during the past decades.China has published a draft foreign investment law ("2018 Draft FIL") which, if it comes into force, will further encourage foreign investment.  If passed into law, the 2018 Draft FIL will replace the Sino-Foreign Equity Joint Venture Law (中外合资企业法), Sino-Foreign Cooperative Joint Venture Law (中外合作企业法) and Foreign Enterprise Law (外资企业法) (the existing main statutes regulating foreign invested entities ("FIEs") in China, all initially promulgated during the 1980s). It is commonly perceived that the current law in this area needs to be updated in light of dramatic social and economic changes during the past decades.

This briefing outlines the highlights and what the new law might mean for foreign investors.

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