Ministry of Commerce, PRC Foreign Investment Law (Draft for Comments)

商务部中华人民共和国外国投资法 (草案征求意见稿)

January 21, 2015 | BY

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Issued: January 19 2014 Main contents: Pursuant to the Draft, an enterprise in China controlled by a foreign investor is treated as a foreign investor,…

Promulgated: 2014-01-19

Issued: January 19 2014


Main contents: Pursuant to the Draft, an enterprise in China controlled by a foreign investor is treated as a foreign investor, and if a foreign investor is controlled by a Chinese investor, its investments in the China may be deemed investments of the Chinese investor.


With respect to foreign investment, the Draft specifies that not only are greenfield investments included, but mergers and acquisitions, medium and long-term financing, securing of concessions for the exploration and development of natural resources and the construction and operation of infrastructure, securing of rights in immovable property as well as control of enterprises in China or the holding of rights and interests in domestic enterprises by virtue of contracts, trusts or otherwise are also included.


The Draft abolishes the case-by-case examination and approval system established by the three foreign investment laws. The competent foreign investment department implements access permission only for investments in sectors enumerated in catalogues governing investments subject to special administrative measures, and the subjects of examination are no longer contracts and articles of association, but the foreign investors and their investment acts. Additionally, the Draft specifies that where a foreign investor invests in China, it is required to perform reporting obligations, regardless of whether its investment is in a sector enumerated in a catalogue governing investments subject to special administrative measures.


The Draft expressly specifies that control by way of an agreement is a form of foreign investment and is governed by the Law.


See the full translation.

promulgated:2014-01-19

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