Others
RSS 
中文 日本語 English Deutsch  | 
Guide : In this case, we filed an invalidation request against the design patent titled Shop Front (Milk Tea Shop) with a prior trademark right as evidence, which was approved by th...
Guide : In this case, we filed an invalidation request against the design patent titled Shop Front (Milk Tea Shop) with a prior trademark right as evidence, which was approved by th...
Foreign Investment Law of People’s Republic of China(2019)


Issuing Agency: Standing Committee of the National People’s Congress
Issuing Date: 2019.03.15
Effective Date: 2020.01.01
Effectiveness: not yet in force
Document No: No. 26 of the order of the President of the People’s Republic of China
 
 
Foreign Investment Law of People’s Republic of China
No. 26 of the order of the President of the People’s Republic of China
 
The Foreign Investment Law of People’s Republic of China has been adopted at the 2nd session of the 13th National People's Congress of the People's Republic of China on March 15, 2019. It is hereby promulgated and shall come into force as of January 1, 2020.
 
Xi Jinping, President of the People’s Republic of China
March 15, 2019
(Adopted at the 2nd session of the 13th National People's Congress on March 15, 2019)
 
Chapter I General Provisions

Article 1 
This Law is formulated in accordance with the Constitution for the purpose of opening wider to the outside world, promoting the foreign investment, safeguarding legal interests of the foreign investment, regulating the foreign investment administration so as to promote and form a new structure of comprehensive opening up in furtherance of healthy development of a social market economy.

Article 2
This Law applies to foreign investment within the territory of the People’s Republic of China (hereinafter referred to as “within China”).

“Foreign investment” in this Law refers to investment activities directly or indirectly conducted by natural persons, business entities, or other organizations of a foreign country (hereinafter referred to as “foreign investor”) within China, including the following situations:

(I) a foreign investor, individually or collectively with other investors, establishes a foreign-invested enterprise within China;
(II) a foreign investor acquires stock shares, equity shares, interests in assets, or other like rights and interests of an enterprise within China;
(III) a foreign investor, individually or collectively with other investors, invests in a new project within China; and
(IV) foreign investments in other forms as provided by law, administrative regulations, or by the State Council.

“Foreign-invested enterprise” in this Law refers to an enterprise all or part of whose capital is invested by foreign investor(s) and duly registered and established within China in accordance with Chinese law.

Article 3
The opening-up policy is maintained as a basic State policy, and foreign investors are encouraged to invest within China in accordance with law.

The State adopts a high-level investment liberalization and facilitation policy, establishes and improves a mechanism for advancing foreign investment, and creates a market environment with stability, transparency, predictability and fair competition.

Article 4
The State adopts an administration system of pre-establishment national treatment plus a negative list for foreign investment.

The pre-establishment national treatment mentioned in the preceding paragraph refers to a treatment granted to foreign investors and their investment during investment entry period, which is no less favorable than that granted to domestic investors and their investment; the negative list mentioned in the preceding paragraph refers to special administrative measures the State adopts on foreign investment in specific sectors. Foreign investment in sectors not on the negative list shall receive a national treatment.

A negative list shall be issued or approved for issuing by the State Council.

Any international treaty or agreement the People’s Republic of China acceded to or entered into that provides more favorable treatment for entry of foreign investors may be implemented in accordance with the relevant rules.

Article 5
The State protects, in accordance with law, the investments made by foreign investors within China, their income, and their other lawful rights and interests.

Article 6
Foreign investors and foreign-invested enterprises conducting investment activities within China shall abide by Chinese law and administrative regulations, and shall not endanger China’s national security or harm social public interests.

Article 7
The competent departments under the State Council in charge of commerce and investment shall, according to division of their responsibilities, promote, protect, and administer foreign investment; the other departments of the State Council shall, within the scope of their respective responsibilities, be responsible for affairs relevant to promotion, protection and administration of foreign investment.

The relevant departments of local people’s governments above the county level shall, according to division of their responsibilities determined by law and administrative regulations and by the people’s government at the same level, promote, protect, and administer foreign investment.

Article 8
Employees of a foreign-invested enterprise establish a trade union in accordance with law, which organizes union activities and protects the lawful rights and interests of the employees. Foreign-invested enterprises shall provide necessary conditions for their unions to conduct activities.
 
Chapter II Promotion of Investment

Article 9
Foreign-invested enterprises equally enjoy, in accordance with law, the various policies supporting the development of enterprises.

Article 10
Before a law, regulation, or rule regarding foreign investment is made, opinions and suggestions of foreign-invested enterprises shall be obtained.

Any regulatory or adjudicative documents relating to foreign investment shall be timely publicized in accordance with law.

Article 11
The State establishes and perfects a system serving foreign investment which provides consultation and service for foreign investors and foreign-invested enterprises regarding laws, administrative regulations, and information relating to investment projects.

Article 12
The State establishes multilateral and bilateral investment promotion cooperative mechanism with other states, regions, and international organizations to strengthen international exchanges and cooperation in investment sector.

Article 13
The State may, as needed, establish special economic zones or implement pioneering policy measures on foreign investment in certain areas to promote foreign investment and further market opening-up.

Article 14
The State will, according to the needs of developing national economy and society, encourage and guide foreign investors to invest in specific industries, sectors, or regions. Foreign investors and foreign-invested enterprises may enjoy preferential treatment in accordance with law, administrative regulations, or rules made by the State Council.

Article 15
The State ensures that foreign-invested enterprises equally participate in standard-making in accordance with law, strengthening information disclosure and social supervision.

The mandatory standards made by the State equally apply to foreign-invested enterprises.

Article 16
The State ensures that foreign-invested enterprises participate in government procurement through fair competition. The products produced or services provided by foreign-invested enterprises within China shall be equally treated in government procurement in accordance with law.

Article 17
Foreign-invested enterprises may obtain financing through public offering of securities such as stocks or corporate debts, as well as through other methods.

Article 18
Local people’s governments at or above the county level may, according to the provisions of law, administrative regulations, and local legislations and within their legally delegated authorities, take policy measures to promote and facilitate foreign investment.

Article 19
The local people’s governments at all levels and the relevant departments thereof shall, in accordance with the principles of facilitation, efficiency, and transparency, simplify procedures, improve efficiency, provide better administrative services, and further improve the standard for serving foreign investment.

The departments concerned shall formulate and publicize foreign investment guides to serve for and facilitate foreign investors and foreign-invested enterprises.
 
Chapter III Protection of Investment

Article 20
Foreign investors’  investments may not be expropriated by the State.

Under special circumstances, the State may, as required by public interests, expropriate or requisition the investment of foreign investors in accordance with law. The expropriation or requisition shall be conducted in accordance with legally provided procedures, and fair and reasonable compensation shall be made in a prompt manner.

Article 21
The capital contribution, the profits, capital gains, proceeds out of asset disposal, intellectual property rights’ licensing fee, indemnity or compensation legally obtained, or proceeds received upon liquidation of foreign investors within China, may freely remitted inward and outward in RMB yuan or a foreign currency.

Article 22
The State protects the intellectual property rights of foreign investors and foreign-invested enterprises, protects the lawful rights and interests of intellectual property right holders and relevant right holders thereof, and strictly holds those who infringe upon other’s intellectual property rights legally accountable.

The State encourages technological cooperation during foreign investment based on voluntariness and commercial rules. The conditions for technological cooperation are to be determined through equal consultation by the investors in compliance with the principle of fairness. Administrative agencies and their employees shall not force technological transfer through administrative measures.

Article 23
Administrative agencies and the employees thereof shall, in accordance with law, keep confidential the commercial secrets of foreign investors and foreign-invested enterprises they obtain in performing their duties, and shall not disclose or illegally provide them to others.

Article 24
When making regulatory documents involving foreign investment, local people’s governments at all levels and the relevant departments thereof shall comply to provisions of law and administrative regulations; without a basis in law or administrative regulations, the lawful rights and interests of foreign-invested enterprises shall not be derogated, their obligations shall not be augmented, conditions for market entry and exit shall not be imposed, and the normal production and operation activities of foreign-invested enterprises shall not be intervened.

Article 25
Local people’s governments at all levels and the relevant departments thereof shall honor their commitments on policies made in accordance with law to foreign investors and foreign-invested enterprises, and perform the contracts entered into therewith in accordance with law.

Where it is necessary for them to change such a policy commitment or a contract for national or social public interest purpose, it shall be done within their legally delegated authority and in accordance with legal procedure, and the damage thus suffered by foreign investors and foreign-invested enterprises shall be compensated in accordance with law.

Article 26
The State establishes a mechanism for foreign-invested enterprises to lodge complaints, in order to timely resolve the issues presented by foreign-invested enterprises or their investors, and to coordinate and improve the relevant policy measures.

Where foreign-invested enterprises or their investors believe that an administrative act conducted by an administrative agency and its employee(s) infringes upon their lawful rights and interests, they may apply for coordination and resolution through such grievance mechanism for foreign-invested enterprises.

Where foreign-invested enterprises or their investors believe that the administrative act conducted by an administrative agency and its employee(s) infringes upon their lawful rights and interests, they may apply for administrative review or initiate an administrative litigation in accordance with law, in addition to applying for coordination and resolution through the grievance mechanism for foreign-invested enterprises.

Article 27
Foreign-invested enterprises may establish and voluntarily participate in chamber of commerce or an association in accordance with law. Chamber of commerce and associations shall organize relevant activities in accordance with law, administrative regulations, and their articles of association, and safeguard the lawful rights and interests of their members.
 
Chapter IV Administration of Investment

Article 28
Foreign investors shall not invest in the sectors on the negative list of foreign investment entry that foreign investment is prohibited.

Foreign investors investing in a sector listed on the negative list of foreign investment entry as a restricted sector shall satisfy the requirements provided in the negative list.

Foreign investment in a sector not listed on the negative list of foreign investment entry shall be administered according to the principle that domestic and foreign investments are treated alike.

Article 29
Where an investment project in a foreign investment is required by the State to obtain approval or enter into the record, the relevant rules shall be followed.

Article 30
A foreign investor investing in an industry or sector that requires a license shall obtain the relevant license in accordance with law.

Unless otherwise provided by law or administrative regulations, the relevant departments in charge shall review foreign investors’ application for a license in accordance with the same conditions and procedures for domestic investors.

Article 31
The form of organization, the organizational structure, and the bylaws of foreign-invested enterprises shall conform to the provisions of the laws such as Corporation Law of the People’s Republic of China and the Law of the People’s Republic of China on Partnership Enterprises.

Article 32
Foreign-invested enterprises shall observe the provisions of the law and administrative regulations regarding labor protection and social insurance, and handle the matters relating to taxation, accounting, and foreign exchanges, etc. according to the provisions of law, administrative regulations, and the relevant rules of the State, and accept supervision and inspection of the relevant departments as authorized by law.

Article 33
A foreign investor that acquires an enterprise within China or participates in concentration of business operators through other ways shall accept review of such in accordance with the Anti-Monopoly Law of the People’s Republic of China.

Article 34
The State establishes a mechanism for reporting foreign investment information. Foreign investors and foreign-invested enterprises shall, through the enterprise registration system and the enterprise credit information disclosure system, report investment information to the competent departments in charge of commerce.

The content and coverage of foreign investment information report are determined based on the principle of actual necessity; the investment information available through the departmental information sharing system shall not be required to further report.

Article 35
The State establishes a security review system for foreign investment to review the foreign investments that affect or may affect national security.

The security review decision made in accordance with law shall be final.
 
Chapter V Legal Liability

Article 36
Where a foreign investor invests in a sector listed on the negative list of foreign investment entry as a prohibited sector, the relevant department in charge shall order it to stop investment activities, and dispose of shares or assets, or adopt other necessary measures within a specified period of time to restore it to the status prior to the investment was made; any illegal gains shall be forfeited.

Where a foreign investor’s investment activity is in violation of the special administrative measures on a sector listed on the negative list of foreign investment entry as a restrictive sector, the relevant department in charge shall order it to make correction within a specified period of time and to adopt necessary measures to satisfy the requirements imposed by the special administrative measures; if correction is not made within the specified period of time, the provisions in the preceding paragraph shall be applied.

Where a foreign investor’s investment activity is in violation of the rules provided by the negative list of foreign investment entry, the foreign investor shall assume, in addition to the consequences as provided in the preceding two paragraphs, corresponding legal liability in accordance with law.

Article 37
Where a foreign investor or a foreign invested-enterprise has not submitted investment information according to the requirement of the foreign investment information reporting system in violation of this Law, the competent department in charge of the commerce shall order it to make correction within a specified period of time; if correction has not been made within the specified period of time, a fine no less than 100,000 yuan but no more than 500,000 yuan shall be imposed.

Article 38
The relevant departments shall, in accordance with law, investigate and deal with the conduct of foreign investors and foreign-invested enterprises in violation of law or administrative administrations, and enter them into the credit information system according to the relevant rules of the State.

Article 39
Employees of administrative agencies who misuse their authority, neglect their duty, or commit corruption, or disclose or illegally provide to others any commercial secrets obtained through performing their duties, shall be sanctioned in accordance with law; if any of the above conducts constitutes a crime, criminal liability shall be imposed.
 
Chapter VI Supplementary Provisions

Article 40
Where a country or region adopts measures relating to investment that discriminate against the People’s Republic of China, including prohibitions, restrictions, and other similar measures, the People’s Republic of China may adopt similar measures against such country or region based on the actual situation.

Article 41
In connection with administration of foreign investors’ investments in financial industries such as the banking, securities, and insurance industries, or investments in financial markets such as securities market or foreign exchange market, any special rules of the State, if any, shall be followed.

Article 42
This Law shall take effect since January 1, 2020. The Law of the People’s Republic of China on China-Foreign Equity Joint Ventures, the Law of the People’s Republic of China on Wholly Foreign-Owned Enterprises, and the Law of the People’s Republic of China on China-Foreign Contractual Joint Ventures shall be repealed at the same time.

The foreign-invested enterprises established under the Law of the People’s Republic of China on China-Foreign Equity Joint Ventures, the Law of the People’s Republic of China on Wholly Foreign-Owned Enterprises, and the Law of the People’s Republic of China on China-Foreign Contractual Joint Ventures prior to the implementation of this Law may keep their original organization forms within five years since the implementation of this Law. Specific implementation rules shall be made by the State Council.
About us | Contact us | Favorite | Home Page
©2008-2025 By Linda Liu & Partners, All Rights Reserved.