A new draft law plans comprehensive changes to the way foreigners invest and operate in China. Danian Zhang and Howard Wu explain

On 19 January 2015, the Ministry of Commerce (MOFCOM) released a draft of a new Foreign Investment Law for public comment. The public comment period ran until 17 February 2015. The draft law is meant to replace the existing legal framework governing foreign-invested enterprises (FIEs) in place since 1979, including the Sino-Foreign Equity Joint Venture Law (EJV Law), the Sino-foreign Co-operative Joint Venture Law, and the Law on Wholly Foreign Owned Enterprises, as well as their respective implementing regulations (collectively, the FIE laws). When passed, this law will stand as a historic event in China’s reform and opening up.

Key features of draft law

The draft law aims to establish a framework for the regulation and monitoring of foreign investment in the areas of market entry and ongoing compliance, while leaving the corporate form and governance issues to other legislation, namely the Company Law, the Partnership Law, and the Law on Enterprises Wholly-owned by Individuals.

You must be a subscribersubscribersubscribersubscriber to read this content, please subscribesubscribesubscribesubscribe today.

For group subscribers, please click here to access.
Interested in group subscription? Please contact us.



Danian Zhang is a partner and chief representative, and Howard Wu is a partner at Baker & McKenzie’s Shanghai office