China approves new foreign investment law designed to level domestic playing field for overseas investors
- Attempt by Beijing to address key issues raised by US President Donald Trump as part of the US-China trade war including forced technology transfer and market access
- Draft had received a lukewarm reception, but was approved by the vast majority of the National People’s Congress lawmakers on Friday in Beijing
China approved its new foreign investment law on Friday, sending the message that Beijing wants to level the playing field for overseas investors and reassure the global community it remains an attractive investment destination.
The final draft of foreign investment law was approved by 2929 National People’s Congress lawmakers in the Great Hall of the People, with eight opposing the measures and eight abstaining.
The new law will come into effect on January 1, 2020.
Beijing rushed the legislation through the country’s largely ceremonial legislature in an effort to fend off complaints from the United States and Europe about unfair trade practices. The new law was first introduced as a draft in 2015, but its progress picked up markedly from the middle of last year to address issues identified by Washington as part of the US-China trade war.
The law attempts to address outstanding concerns from foreign investors, such as unfair treatment in terms of market access and government procurement, forced technology transfer to Chinese partners and the theft of commercial secrets from foreign businesses in China.
