Supporting Broad Foreign Participation in “Made in China 2025”

The Catalogue for the Guidance of Foreign Investment Industries (Revised in 2017) Expands the Scope of Encouraged Policies—

Supporting Broad Foreign Participation in “Made in China 2025”

　　On the 29th, Sun Jiwen, Spokesperson of the Ministry of Commerce, stated that the recently released “Catalogue for the Guidance of Foreign Investment Industries (Revised in 2017)” represents another significant reform through which China is proactively opening its doors to the world and further improving its investment environment. The new Catalogue will better support foreign-invested enterprises in playing a vital role in the development of the real economy.

　　According to the briefing, the 2017 Edition of the Catalogue exhibits three key features: First, it further narrows the scope of approval required for the establishment and modification of foreign-invested enterprises. With the exception of “domestic companies, enterprises, or natural persons acquiring domestic companies with which they have affiliated relationships through mergers and acquisitions involving companies legally established or controlled overseas,” all foreign-invested M&A transactions that do not involve special access-related administrative measures—such as the introduction of strategic foreign investment in listed companies—are now subject to filing-based management. The Ministry of Commerce will also concurrently put in place supporting measures and, when appropriate, revise and issue the Measures for the Filing-Based Administration of the Establishment and Modification of Foreign-Invested Enterprises, thereby clarifying the filing procedures for M&A-driven enterprise establishment and modifications. This will substantially streamline the formalities for foreign-invested M&A transactions and effectively reduce institutional transaction costs.

　　Second, restrictions on foreign investment access in the service, manufacturing, and mining sectors have been further relaxed, with the number of restrictive measures reduced to 63—30 fewer than the 93 restrictive measures in the 2015 edition of the Catalog.

　　Third, the scope of encouraged policies has been further expanded. The Catalogue now includes a total of 348 encouraged items, representing an increase of 6 compared with the 2015 edition and a revision of 35 items. New additions include the research, development, and manufacturing of virtual reality (VR) and augmented reality (AR) equipment, the R&D and manufacturing of key components for 3D printing equipment, and the construction of urban parking facilities. These new and revised encouraged items will better facilitate the integrated attraction of foreign investment, advanced technology, and cutting-edge expertise, continue to encourage foreign investment in sectors aligned with China’s industrial transformation and upgrading, and support extensive foreign participation in the “Made in China 2025” initiative and the innovation-driven development strategy. (Reporter: Feng Qiyu)