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Foreign Investment Law Implementing Regulation Takes Effect on 1 January 2020

China has introduced new draft regulations in a bid to promote opening-up at a higher level under a rules-based framework. It ensures equal treatment for foreign and domestic companies , as well as strengthening protection for overseas investors.

The State Council passed the draft Implementing Regulation on Foreign Investment Law at its 12 December executive meeting. The new legislation will be implemented alongside the Foreign Investment Law, starting 1 January 2020.

The Implementing Regulation specifies and clarifies administrative regulation to better address foreign investor concerns. First, the regulation requires equal treatment of domestic and foreign businesses regarding project application, land supply, tax and fee cuts and qualifications licensing. Second, the regulation pledges to strengthen foreign investment protection and clearly stipulates that foreign investment will not be expropriated by the State. In special cases where expropriation is necessary for the public interest, legal procedures and provisions should be followed, and compensation should be made based on market value.

Source: State Council

Content provided by Picture: HKTDC Research
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