Recent Developments in PRC Foreign Investment, Cross-border Tech Transfer, and Trade Secrets Laws – Implications for Foreign IP Owners

March and April 2019 were whirlwinds for foreign IP owners with respect to the legal and regulatory framework in China governing foreign investment, cross-border technology transfer, and trade secret protection.

On March 15, China issued the new PRC Foreign Investment Law (FIL) (中华人民共和国外商投资法) effectively replacing the existing foreign investment regime (comprising the Sino-foreign Equity Joint Venture Law (中外合资经营企业法), the Wholly Foreign-owned Enterprise Law (外资企业法), and the Sino-foreign Cooperative Joint Venture Law (中外合作经营企业法), which will become obsolete upon the FIL taking effect on  January 1, 2020).  By way of State Council Administrative Decree No. 709, issued on March 2 and effective as of March 18, important revisions were made to the longstanding PRC Regulations for the Administration of Technology Import and Export (TIE Regs) (中华人民共和国技术进出口管理条例) and the Implementing Regulations for the PRC Sino-foreign Equity Joint Venture Law (EJV Regs) (中华人民共和国中外合资经营企业法实施条例) (the latter to be rendered obsolete when the FIL becomes effective).  Also, the National People's Congress' Standing Committee issued a decision on April 23 to amend with immediate effect the PRC Anti-unfair Competition Law (AUCL) (中华人民共和国反不正当竞争法), which is the basis for trade secret protection in China, as well as the PRC Administrative Permissions Law (APL) (中华人民共和国行政许可法), which addresses both trade secret and tech transfer issues.