IMPLEMENTATION LEVEL

National

AFFECTED FLOW

Inflow

ANNOUNCED AS TEMPORARY

No

NON-TRADE-RELATED RATIONALE

No

ELIGIBLE FIRMS

all

JUMBO

No

TARIFF PEAK

No
← back to the state act
Inception date: 28 Jun 2018 | Removal date: open ended
Still in force

FDI: Entry and ownership rule

In June 2018, the Chinese government released an update to their catalogue of sectors where FDI is restricted.

The new version is much shorter than the previous edition (from 2017; see related act).

The number of items in the list has been reduced from 63 to 48.

Restrictions have been removed on investments into the following industries:

  • Railway networks (incl. high-speed rail);
  • International shipping;
  • International maritime passenger transport;
  • Aeroplanes (all subsectors);
  • Petrol stations;
  • Grain purchasing and wholesale;
  • Crop growing (except wheat and corn);
  • Mining of rare coal isomers (graphite etc.);
  • Rare earth and tungsten smelting and purification (N.B. exploration still proscribed);
  • Weapons and ammunition;
  • Mapping companies (except certain ones not favoured by the CCP).

Other changes are as follows:

  • No more equity restrictions on FDI in Chinese banking sector;
  • Max. allowable FDI in securities, fund management, futures and life insurance companies raised from 25% to 51%, with this to be totally removed by 2021;
  • Confirmation of a previous announcement that controls on foreign-ownership in the auto industry would be removed by 2022 (2020 for commercial vehicle investments);
  • Added restriction on investment in performing art groups.

The changes are nominally liberalising, hence the green classification of this intervention. However, in practice, government approval will still be necessary for investments in many of the liberalised sectors.

AFFECTED COUNTRIES

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