Entering the New Era of China’s Foreign Investment Administration

On April 23, 2019, nearly 100 representatives from multinational companies, foreign chambers of commerce, industry associations and government agencies attended the 7th DaoHe Forum to interpret and discuss China's new Foreign Investment Law (FIL). During a three-hour session, two well-known experts who participated in the drafting process of the new law shared their insights on the background of FIL and provided comprehensive and in-depth analysis of the key breakthroughs of the new law. Representatives from over 70 foreign multinational companies were actively engaged in the discussion and shared their perspectives and suggestions.

The keynote speakers include Mr. LUO Yuze, Director of Foreign Economic Relations at the State Council's Development Research Center (DRC) and Professor CUI Fan from the School of International Trade and Economics of the University of International Business and Economics (UIBE), both of whom participated in the drafting process of the new law. Mr. LUO and Prof. CUI shared deep insights on the rationale and legislative mentality of China passing FIL at this stage of development and provided practical suggestions to companies on specific issues. Government officials from Beijing Municipal Government also attended the forum to discuss with companies and experts who to implement the new law.


By analyzing how the new law came about and where it heads to, Mr. LUO and Prof. CUI helped MNC companies understand not only the law’s principles and article connotation, but also the main purpose or the “whys” behind the articles, which is to promote utilization of foreign investment, protect the legitimate rights and interests of foreign investment and build a stable, fair, transparent and predictable business environment. For example, when analyzing why the number of articles was reduced from 170 in the draft of 2015 to the current 42, the experts pointed out that the “simplification” aims at keeping the law stable for the long term and reserving room for adaption and adjustment in the future. Speaking of the “fast-tracked” approval process of FIL, the experts indicated the speed reflected China’s efforts and sincerity on boosting opening-up, improving business environment and improving the rule of law.

Regarding the highly concerned questions on how the Law will be implemented, Mr. LUO and Prof CUI shared insights on the possible scenarios of the implementation rules and provided practical recommendations to MNC companies on their operating strategies in China during the transitional period. The discussion on definition of foreign investment was of particular value to the participants.

During the social hour following the formal session, MNC representatives held further discussions with the speakers and government officials. Once again, DaoHe Forum well served its purpose of being the bridge between MNC companies and the government and provided deep forward-looking interpretation of polices that impact all business in China.