Following the closing (March 15) of National People’s Congress (NPC)’ 2019 annual meeting in Beijing, two important annual forums were held – China Development Forum 2019 (March and Boao Forum for Asia 2019
One of the major progress made during NPC’s annual meeting is the approval of the new foreign investment law #中华人民共和国外商投资法 (original link here)
The law was first introduced as a draft in 2015 and will come into effect on January 1, 2020.
The new foreign investment law will replace the “three foreign capital laws” – Law on Sino-Foreign Equity Joint Ventures #中外合资经营企业法, Law on Foreign-Capital Enterprises #外资企业法 and Law on Sino-Foreign Cooperative Joint Ventures #中外合作经营企业法, which were introduced in 1979, 1986 and 1988 respectively. They were updated along the way but structural/fundamental changes won’t be easy. (you can’t expect a law to be efficient and perfect after 30-40 years.. in a fast-changing environment)
China Development Forum is more focused on China. And of course, the newly-passed foreign investment law was discussed and introduced to all the CEOs/managements from foreign companies among others.
Again, on Boao Forum For Asia, Premier Li Keqiang reemphasized the plan to make detailed regulations to enforce the effective implementation of the foreign investment law.
Updates:
- 3/28, JP Morgana and Nomura have been approved to set up JV in mainland China with equity ownership percentage of 51% with no ban on any specific services, as a part of Beijing’s promise to open up financial services sector to foreign companies.