Selected From No. 287, Oct 2016 Newsletter
Amendments to Four Laws Including the Law of the People’s Republic of China on Foreign Capital Enterprises
On 3 September 2016, the 22nd Meeting of the Standing Committee of the Twelfth National People’s Congress passed the “Decision to Amend Four Laws including the Law of the People’s Republic of China on Wholly Foreign- Owned Enterprises” (the Decision). The Decision made amendments to the administrative approval of four laws, namely the “Law of the People’s Republic of China on Foreign Capital Enterprises”, the “Law of the People’s Republic of China on Chinese-Foreign Equity Joint Ventures”, the “Law of the People’s Republic of China on Chinese- Foreign Contractual Joint Ventures”, and the “Law of the People’s Republic of China on the Protection of Investment of Taiwan Compatriots”. The Decision sets out that, to replace the existing approval requirements, only an administrative registration is required for the establishment and change of foreign-invested enterprises and Taiwan compatriots-invested enterprises not involving in the Special Administrative Measures for foreign investment access in China. The amendments to the four laws and the nationwide implementation of the pre-establishment national treatment and the negative list approach, is a major reform in the administrative regime of the nation. It is a realisation of the principle of “All of the major reforms should have a legal basis” and will further consolidate the opening- up policy and enhance the Rule of Law, as well as promoting a business environment with greater international exposure and facilitation.