NDRC and MOFCOM Publish New Foreign Investment Catalog

On December 7, The National Development and Reform Commission (NDRC) and Ministry of Commerce (MOFCOM) released the revised Foreign Investment Catalog for public comment. The catalog, last updated in 2015, originally contained a list of 93 restrictive measures, while the newly proposed catalog only contains 62 restricted areas of investment. Some new areas of opening up and reform include the service, manufacturing, and mining sectors, among others.

Foreign investors can now participate in industries such as highway passenger transportation, shipping tallying services, credit investigation and ratings, as well as production for electric car batteries, small scale power grids, ethanol and precious metals mining. Additionally, the layout of the negative list has changed to include a section on encouraged investment categories and a section that combines all the areas of restriction into a unified negative list while clearly noting those that have equity caps or are completely restricted from forming JVs.
 
This announcement reflects China’s commitment to open market access and builds upon the “Provisional Administrative Rules on the Establishment and Amendment of FIEs,” released by MOFCOM in October. These policies are designed to reduce the amount of burden, paperwork and time it takes for FIEs to receive investment approval for items not denoted on the negative list.