Members of the public had up to 15 September 2012 to submit their comments on the draft versions of the following draft measures (Draft Measures) issued by the National Development and Reform Commission (NDRC) on 16 August 2012:
The Draft Measures are revised from the currently effective “Interim Measures for the Administration of Examination and Approval of Foreign Investment Projects” (Interim Measures for FIP) and the “Interim Measures for the Administration of Examination and Approval of Overseas Investment Projects” (Interim Measures for OIP) respectively, both of which were promulgated in 2004, and supplemented by various NDRC notices issued thereafter.
Due to the fast growing outbound and inbound foreign investments in recent years, many new situations and problems have emerged in China, with a growing need to, on the one hand, reduce China’s huge amount of foreign reserves and ease pressure on the Chinese Yuan, as well as to facilitate the domestic companies in gaining international exposure; and on the other, to optimize foreign investment structures, diversify foreign investments and create a favourable investment environment for foreign investors.
The Draft Measures are aimed to achieve the above objectives, with:
The Draft Measures essentially cover a series of regulations and notices released by the NDRC in recent years (including those relating to delegation of approval powers to the authorities below), and reaffirm several policies which have been implemented by the NDRC for outbound and inbound investments for several years (such as implementation of the security review system, requirement for energy conservation, etc.). The Draft Measures, if adopted, will supersede the existing Interim Measures for FIP and Interim Measures for OIP, as well as the related regulations governing the same.
It is anybody’s guess as to when the Draft Measures will be formally promulgated, and whether the final versions will be substantially similar to the existing Draft Measures. Nevertheless, it is advisable for investors looking to expand their businesses in China and/or overseas to pay close attention to the development of the Draft Measures, and consider how they may strategize and expand their businesses when the Draft Measures take effect as laws governing outbound and inbound investments.