New draft investment law released
January 26, 2015 Category Foreign investment, Weekly
Foreign investors will have to gain security clearance from the government for investments that are considered harmful to national security, according to the draft foreign investment law released by the Ministry of Commerce (MOFCOM). The government will set up a joint ministerial mechanism to carry out security reviews on foreign investment similar to the review system in foreign countries. The draft law lists investments in sectors such as defense, energy, grain and information technology as potential sectors for reviews. The full text is available on the Ministry’s website, and the public can submit feedback until February 17 at the website www.mofcom.gov.cn, or by sending an e-mail to investmentlaw@mofcom.gov.cn, a fax to 010-65198905 or letter to the Ministry. The draft law still needs to be submitted to the National People’s Congress (NPC) for final review. Commerce Ministry Spokesman Sun Jiwen said the draft law also eases restrictions on foreign investors and grants them easier access to the Chinese market. Foreign companies will receive pre-established national treatment (equal to domestic companies) under the new regulations, and the current case-by-case approval system would be replaced by a “negative list”. Sun said these moves would create a level playing field for foreign and domestic investors, as well as enhance security reviews, the China Daily reports.
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