On 15 March 2019, the National People’s Congress of China has approved the Foreign Investment Law. According to the Foreign Investment Law Chinese subsidiaries of foreign parents will be treated in the same manner as Chinese-owned Chinese entities. However, the former is subject to a negative list of foreign investment which prohibits foreign investors from investing in specific industries.
The Foreign Investment Law encourages Foreign-invested enterprises by allowing raising funds through the public offering of stock, corporate bonds and other securities. New registration forms will be required for investments under the Foreign Investment Law.
A five-year transition period is provided to change all required registrations forms to comply with the rules under the Foreign Investment Law. On 1 January 2020, the Foreign Investment Law will become effective and will replace existing foreign investment laws.
