China issues 2019 Negative Lists and Encouraged Catalogue for Foreign Investment

China’s National Development & Reform Commission (NDRC) and Ministry of Commerce (MOF) jointly issued the 2019 editions of China’s National and Free Trade Zone negative lists, together with the 2019 Foreign Investment Encouraged Catalogue. All three took effect on 30 July 2019.

The new lists and catalogue will assist foreign investors when evaluating investments or market entry into China by enabling to assess whether their business will be permitted or can enjoy preferential policies from the government.

Overall, the 2019 FI negative lists have been shortened, while the encouraged catalogue has been extended. Compared to the 2018 version, the number of items on the 2019 FI negative lists has reduced from 48 to 40 on the national list, and 45 to 37 on the FTZ list. No new items have been added.

The 2019 FI national negative list further opens up the services, agriculture, mining and manufacturing sectors to foreign ownership. The FTZ negative list further opens up another two industries – the fishing industry and the printing industry. For industries not included in the negative list, foreign and domestic investors enjoy equal access under the law, except in respect of record-filing requirements.

The 2019 FI Encouraged Catalogue consists of two sub-catalogues – one applies to the whole of China and the other to 22 provinces in China’s central, western, and northeastern regions. Nationally, the number of encouraged industries has increased from 348 to 415, with 67 items added and 45 items revised, compared with 2017.

New sectors for encouragement include modern agriculture, advanced manufacturing, high and new technology, energy conservation and environmental protection, and the service industry. Foreign-funded projects that fall under the encouraged catalogue are eligible for preferential treatment, such as tax incentives, streamlined approval procedures, and discounted land prices.

For further information, please contact Sovereign (China) Limited by phone on +8621 5211 0068 or by email.

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