Breakdown & Analysis of China's New Outbound Investment Regulations
In today’s edition of the newsletter, I am offering a breakdown and my takeaways of the new regulation on outbound investment, which will take effect from July 1, 2026. The full text of the regulations is available on Xinhua. I am going to share some significant excerpts and the Q&A with officials discussing these new regulations. But before I get to that, let me offer a few preliminary thoughts.
First, these Regulations add a serious arrow in Beijing’s economic security and coercion quiver. In essence, it gives the state tremendous power over all sorts of outbound investment by all types of entities and individuals within the PRC. I would assume that this also involves foreign invested enterprises based within China, although application in those cases might be selective. In any case, none of the officials interviewed by Xinhua have offered to clarify this.
Second, Article 13 grants the state sweeping authority over the export of goods, technologies, services, and data, as well as the cross-border dispatch of personnel, provision of technical guidance, organisation of training activities, etc. This authority can be wielded to deny outflows to other countries and deployed as political leverage. Consider a Western technology company operating in China that depends on Chinese suppliers or skilled Chinese personnel. Should that company seek to diversify its investments and build supply-chain resilience, Beijing is now legally empowered to prevent it from doing so.
Third, Article 15 creates the blanket and ambiguous national security option for the state to intervene, as it empowers it to carry out security reviews of outbound investments, along with the transfer or disposal of related assets, rights and interests, etc., that affect or may affect national security. This is again applicable to entities within the territory of China, and therefore, can be applied to foreign invested enterprises too.
Fourth, Article 22 demands that enterprises within the territory of China that are engaged in arbitration or litigation related to outbound investment or involved in an investigation by overseas judicial or law-enforcement authorities must comply with Chinese laws when it comes to sharing information. This adds new layers of legal requirements for Chinese enterprises and foreign subsidiaries based in China to deal with, which I am certain they are unlikely to be thrilled about. In addition, it creates enormous scope for procedural delays and reason for denial of information. This is likely to frustrate foreign litigation, as entities within China have a legally mandated excuse to withhold information, and the state acquires a veto over what gets disclosed to foreign courts and regulators.
Fifth, Article 24 affords clear and straight-forward discretionary powers to the state to intervene wherever it deems fits. The point that if a country or international organisation “violates international law and the basic norms of international relations, and adopts discriminatory prohibitions, restrictions, or other similar measures against the People’s Republic of China in matters such as investment and operation” is incredibly vague and open to interpretation. Let’s think about how this can be applied. For example: Beijing argues that “the Government of the People’s Republic of China is the sole legal government representing the whole of China. This is an undeniable fact, a universal consensus of the international community and a basic norm in international relations.” Now, think of companies that have substantive presence within the PRC; Article 24 gives Beijing a legal instrument to pressure them on potential engagement within Taiwan.
Sixth, a similar situation is the case with Article 25; tremendous ambiguity in the definition of the kinds of violations that have been mentioned. In fact, Article 25 can be far more challenging for global businesses, particularly since it says that: “The relevant measures may apply to organisations actually controlled by foreign organisations or individuals, or in whose establishment or operation foreign organisations or individuals participate.” In essence, this extends the target lists from individual entities that the state believes have endangered “China’s national sovereignty, security, or development interests…”, but also subsidiaries or joint ventures in which the targeted company may have a stake. Those can become targets if Beijing believes that there is actual control.
Finally, Article 33 expands the scope of coverage to own funds, capital raised from third parties such as bond issuances or equity, and entrusted funds being managed by someone else. So essentially, there is no gray zone; even portfolio investments get captured within this new regime.
Below are some of the key articles:
Article 1: These Regulations are formulated, in accordance with laws such as the Foreign Relations Law of the People’s Republic of China and the Foreign Trade Law of the People’s Republic of China, for the purposes of advancing high-level opening up, promoting the high-quality development of outbound investment, effectively implementing outbound investment administration, protecting the lawful rights and interests of investors and their outbound investments, and safeguarding national sovereignty, security, and development interests. 第一条 为了推进高水平对外开放，促进对外投资高质量发展，有效实施对外投资管理，保护投资者及其对外投资合法权益，维护国家主权、安全、发展利益，根据《中华人民共和国对外关系法》、《中华人民共和国对外贸易法》等法律，制定本规定.
Article 2: These Regulations apply to outbound investment conducted by investors within the territory of the People’s Republic of China (hereinafter referred to as ‘within the territory of China’). ‘Outbound investment’ as used in these Regulations, namely overseas investment, refers to activities whereby investors, through contributing assets or equity, or providing financing, guarantees, or other means, directly or indirectly obtain ownership rights, controlling rights, operational and management rights, or other related rights and interests in enterprises, assets, and the like in other countries (regions). ‘Investors’ as used in these Regulations include enterprises, other organizations, and resident individuals within the territory of China. 第二条 中华人民共和国境内（以下简称中国境内）投资者对外投资，适用本规定。 本规定所称对外投资即境外投资，是指投资者以投入资产、权益或者提供融资、担保等方式，直接或者间接获得其他国家（地区）的企业、资产等所有权、控制权、经营管理权以及其他相关权益的活动。 本规定所称投资者，包括中国境内的企业、其他组织和居民个人.
Article 3: Work relating to outbound investment shall adhere to the basic state policy of opening up, implement the holistic approach to national security, coordinate development and security, coordinate domestic and international affairs, improve the management and service system for outbound investment, raise the quality and level of outbound investment, and promote open cooperation and mutual benefit and win-win outcomes. 第三条 对外投资工作坚持对外开放的基本国策，贯彻总体国家安全观，统筹发展和安全，统筹国内国际，健全对外投资管理服务体系，提升对外投资质量与水平，促进开放合作、互利共赢。
Article 4: The State shall proactively align with high-standard international economic and trade rules, advance high-quality joint construction of the Belt and Road Initiative, promote the establishment of bilateral and multilateral investment cooperation mechanisms, actively participate in the formulation of international investment rules, promote international cooperation in industrial and supply chains, oppose unilateralism and protectionism, and promote the building of an open world economy. 第四条 国家主动对接国际高标准经济贸易规则，推进高质量共建“一带一路”，推进多双边投资合作机制建设，积极参与国际投资规则制定，推动产业链供应链国际合作，反对单边主义和保护主义，推动建设开放型世界经济.
Article 5: The State supports investors in carrying out outbound investment activities in accordance with market-oriented principles and actively participating in international cooperation and competition. Investors shall, according to law, enjoy autonomy in outbound investment, make independent decisions, bear risks independently, and assume responsibility for profits and losses independently. When carrying out outbound investment and related activities, investors shall comply with laws, regulations, and international practices, respect local customs and cultural traditions, observe business ethics, act honestly and in good faith, compete fairly, fulfill social responsibilities, and safeguard the national image. They shall not disrupt market competition order, damage the ecological environment, or infringe upon the lawful rights and interests of workers; nor shall they endanger China’s national security or harm national interests or the public interest of society. 第五条 国家支持投资者按照市场化原则开展对外投资活动，积极参与国际合作竞争。投资者依法享有对外投资自主权，自主决策、自担风险、自负盈亏。 投资者开展对外投资及其相关活动，应当遵守法律法规和国际惯例，尊重当地习俗和文化传统，遵守商业道德，诚实守信、公平竞争，履行社会责任，维护国家形象，不得妨害市场竞争秩序、破坏生态环境、损害劳动者合法权益，不得危害中国国家安全、损害国家利益和社会公共利益.
Articles 6, 7, 8 and 9 talk about how the state will improve public platforms and services to support investors; support the emergence of professional service institutions in fields such as consulting and evaluation, legal services, accounting and auditing, credit rating, mediation and arbitration, and intellectual property; encourages banks and financial institutions be supportive; and wants industry associations, chambers of commerce, and trade and investment promotion organizations to provide services related to outbound investment..
Article 10: The State shall improve the outbound investment management system, refine regulatory measures, implement classified and tiered whole-process supervision, strengthen risk prevention and control, improve the scientific basis and security of outbound investment, and promote a combination of investment facilitation and effective risk prevention. 第十条 国家健全对外投资管理体系，完善调控措施，分类分级实施全过程监管，加强风险防控，提高对外投资的科学性、安全性，推动投资便利化和有效防范风险相结合。
Article 11: The State Council department in charge of investment, the department in charge of commerce, together with other relevant State Council departments, shall formulate, adjust, and implement outbound investment policies in light of national economic and social development needs, changes in the investment environment of relevant countries (regions), risk levels, and other factors. They shall clarify encouraged, restricted, and prohibited outbound investments, strengthen supervision over outbound investment, and guide and supervise investors in conducting investment and business activities in a standardised manner. 第十一条 国务院投资主管部门、商务主管部门会同国务院其他有关部门根据国民经济和社会发展需要、有关国家（地区）投资环境变化和风险程度等，制定、调整和实施对外投资政策，明确鼓励、限制、禁止的对外投资，加强对外投资监管，指导、监督投资者规范投资经营行为。
Article 13 is important:
When carrying out outbound investment activities, investors shall not export or use goods, technologies, services, or related data whose export is prohibited by the State, nor export or use goods, technologies, services, or related data whose export is restricted by the State without authorisation; they shall not transfer to other countries (regions), through means such as cross-border dispatch of technical personnel, organizing personnel to work in other countries (regions), providing cross-border technical guidance, or arranging cross-border training, goods, technologies, services, or related data whose export is prohibited by the State, nor transfer restricted goods, technologies, services, or related data without authorisation. 第十三条 投资者开展对外投资活动，不得出口、使用国家禁止出口的货物、技术、服务及相关数据，或者未经许可出口、使用国家限制出口的货物、技术、服务及相关数据；不得以跨境派遣技术人员、组织人员赴其他国家（地区）工作、跨境提供技术指导、安排人员跨境培训等方式向其他国家（地区）转移国家禁止出口的货物、技术、服务及相关数据，或者未经许可向其他国家（地区）转移国家限制出口的货物、技术、服务及相关数据.
Article 14: Where outbound investment involves foreign-exchange conversion, import and export of goods and technologies, cross-border trade in services, cross-border data flows, entry and exit of personnel, as well as review of concentrations of undertakings, export control, cybersecurity supervision, tax collection and administration, supervision of state-owned assets, shall be carried out in accordance with the relevant laws, administrative regulations, and relevant state provisions. 第十四条 对外投资涉及资金汇兑、货物与技术进出口、跨境服务贸易、跨境数据流动、人员出境入境的管理以及经营者集中审查、出口管制、网络安全监管、税收征收管理、国有资产监管等，依照有关法律、行政法规和国家有关规定执行.
Article 15: The State shall improve the outbound investment security review system. The competent investment department of the State Council and the competent commerce department, together with other relevant departments of the State Council, shall conduct security reviews of outbound investments, along with the transfer or disposal of related assets, rights and interests, etc., that affect or may affect national security. Relevant organisations and individuals shall provide assistance and cooperation, shall not refuse or obstruct, and shall comply with outbound-investment security review decisions. 第十五条 国家健全境外投资安全审查制度，国务院投资主管部门、商务主管部门会同国务院其他有关部门对影响或者可能影响国家安全的境外投资及相关资产、权益等的转让、处分进行安全审查。有关组织、个人应当予以协助、配合，不得拒绝、阻碍，并应当遵守境外投资安全审查决定.
Article 16: Investors and the enterprises in which they invest in other countries (regions) shall improve their governance structures; establish and improve systems for compliant operations, internal control, work safety, emergency-incident response, and the like; strengthen risk identification, prevention, and disposal; invest the necessary personnel, capital, equipment, and other resources; and safeguard the safety of their employees and assets. 第十六条 投资者及其在其他国家（地区）投资的企业应当完善治理结构，建立健全合规经营、内部控制、安全生产、突发事件处置等制度，加强风险识别和防范处置，投入必要的人员、资金、设备等资源，保障其员工和资产安全.
Article 17: Investors shall regulate their investment and business conduct, and shall not harm other investors’ commercial reputation or the reputation of their goods, infringe the trade secrets of others, dump goods at low prices without justifiable reason, seek illegitimate gains through means such as bribery and fraud, or disrupt the order of the outbound-investment market. 第十七条 投资者应当规范投资经营行为，不得损害其他投资者的商业信誉、商品声誉，侵犯他人商业秘密，没有正当理由低价倾销商品，通过贿赂、欺诈等手段牟取不正当利益，扰乱对外投资市场秩序.
Article 18: The relevant departments of the State Council shall strengthen monitoring, early warning, and risk assessment of outbound investment; in a timely manner release information on the security situation in relevant countries (regions); flag investment risks; guide and assist investors in carrying out security-risk prevention; and safeguard the State’s overseas interests and the lawful rights and interests of investors. 第十八条 国务院有关部门加强对外投资监测预警和风险评估，及时发布有关国家（地区）安全状况，提示投资风险，指导和帮助投资者做好安全风险防范，维护国家海外利益和投资者合法权益.
Article 19: The People’s Republic of China shall, in accordance with international treaties and agreements it has concluded or acceded to, or on the basis of the principle of equality and reciprocity, conduct cooperation and exchanges in the field of law enforcement with other countries (regions), international organisations, and other parties, in order to protect the safety of investors in other countries (regions), of employees and assets belonging to the enterprises and projects in which they invest, and of the legitimate rights and interests of relevant organisations and individuals. The State shall actively negotiate and sign multilateral and bilateral trade and investment agreements and other international economic and trade agreements, raise the level of protection for outbound investment, and promote the liberalisation and facilitation of investment. 第十九条 中华人民共和国根据缔结或者参加的国际条约、协定，或者按照平等互惠原则，与其他国家（地区）、国际组织等开展执法领域合作与交流，保护在其他国家（地区）的投资者及其投资的企业、项目所属员工和资产等的安全以及有关组织、个人的正当权益。 国家积极商签多双边贸易投资协定等国际经贸协定，提高对外投资保护水平，促进投资自由化便利化.
Article 20: The State shall, in accordance with the law, provide consular protection and assistance to Chinese citizens and organisations investing in other countries (regions), as well as Chinese employees working in enterprises and projects they invest in, and safeguard their legitimate rights and interests.
Where a war, armed conflict, riot, serious natural disaster, major accident disaster, major infectious disease epidemic, terrorist attack, or other major emergency occurs in the country (or region) of investment destination, and investors in that country (or region), as well as Chinese-national employees belonging to the enterprises or projects in which they have invested, require assistance because their personal or property safety is threatened, the resident diplomatic missions shall promptly verify the circumstances, urge the relevant country (or region) to adopt effective measures to protect the personal and property safety of Chinese citizens and organizations, and provide assistance according to the relevant circumstances; where the Chinese government makes corresponding evacuation or risk-avoidance arrangements, the relevant organizations and individuals shall cooperate. 第二十条 国家依法为在其他国家（地区）投资的中国公民、组织及其在该国家（地区）投资的企业、项目所属中国籍员工提供领事保护与协助，维护其正当权益。 投资目的国家（地区）发生战争、武装冲突、暴乱、严重自然灾害、重大事故灾难、重大传染病疫情、恐怖袭击等重大突发事件，在该国家（地区）的投资者及其投资的企业、项目所属中国籍员工因人身财产安全受到威胁需要帮助的，驻外外交机构应当及时核实情况，敦促有关国家（地区）采取有效措施保护中国公民、组织的人身财产安全，并根据相关情形提供协助；中国政府作出相应避险安排的，有关组织、个人应当予以配合.
Article 22: Where organizations or individuals within the territory of China participate in arbitration or litigation related to outbound investment, or are subject to investigation by overseas judicial or law-enforcement authorities, and need to provide evidence or related materials to overseas parties, they shall comply with laws, administrative regulations, and relevant State provisions on the safeguarding of State secrets, data security, personal information protection, technology export administration, export controls, judicial assistance, and the like. Where the permission of a competent authority is required by law, the relevant legal procedures shall be carried out. 第二十二条 中国境内组织、个人参与对外投资相关仲裁、诉讼或者受到境外司法、执法机构相关调查，需要向境外提供证据或者相关材料的，应当遵守保守国家秘密、数据安全、个人信息保护、技术出口管理、出口管制、司法协助等法律、行政法规和国家有关规定。依法须经主管机关准许的，应当履行相关法律程序.
Article 23: Where investors encounter trade-related investment barriers or other obstacles to investment and operation in a country (region) of investment destination, the competent commerce department of the State Council may, on its own initiative or together with other relevant State Council departments, organise an investigation; relevant organisations and individuals shall provide assistance and cooperation. Based on the results of the investigation, the relevant State Council departments may take measures such as adjusting the relevant country-specific investment policy, or prohibiting or restricting the import and export of relevant goods or technologies or international trade in services. 第二十三条 投资者在投资目的国家（地区）遭遇与贸易有关的投资壁垒或者其他投资经营障碍的，国务院商务主管部门可以自行或者会同国务院其他有关部门组织开展调查，有关组织、个人应当予以协助、配合。根据调查结果，国务院有关部门可以采取调整有关国别投资政策，禁止或者限制有关货物、技术进出口或者国际服务贸易等措施.
Article 24: Where any country (region) or international organisation violates international law and the basic norms of international relations, and adopts discriminatory prohibitions, restrictions, or other similar measures against the People’s Republic of China in matters such as investment and operation, the Chinese government and its relevant departments may, in light of the actual situation, take corresponding measures to protect the safety and legitimate rights and interests of investors and their outbound investments, and to protect the State’s overseas interests from threat and infringement. The relevant departments of the State Council may, in accordance with the Anti-Foreign-Sanctions Law of the People’s Republic of China, the Provisions on Implementing the Anti-Foreign-Sanctions Law of the People’s Republic of China, and other such instruments, decide to add to the countermeasures list organisations and individuals that directly or indirectly participate in the formulation, decision-making, or implementation of the discriminatory prohibitions, restrictions, or other similar measures provided for in the preceding paragraph, and adopt corresponding measures against them. 第二十四条 任何国家（地区）、国际组织违反国际法和国际关系基本准则，在投资经营等方面对中华人民共和国采取歧视性禁止、限制或者其他类似措施，中国政府及其有关部门可以根据实际情况采取相应的措施，保护投资者及其对外投资的安全和正当权益，保护国家的海外利益不受威胁和侵害。 国务院有关部门可以依照《中华人民共和国反外国制裁法》、《实施〈中华人民共和国反外国制裁法〉的规定》等，决定将直接或者间接参与制定、决定、实施前款规定的歧视性禁止、限制或者其他类似措施的组织、个人列入反制清单，采取相应的措施.
Article 25: Where foreign organisations or individuals endanger China’s national sovereignty, security, or development interests; or, in violation of normal market transaction principles, interrupt normal transactions with Chinese enterprises, other organisations, or individuals; or adopt discriminatory measures against investors and their outbound investments, unreasonably depriving or restricting the legitimate rights and interests of investors and their outbound investments, the relevant departments of the State Council may take measures including:
prohibiting or restricting their engagement in China-related import and export activities;
prohibiting or restricting their investment within the territory of China;
prohibiting or restricting organisations and individuals within the territory of China from engaging in relevant transactions, cooperation, and other activities with them;
prohibiting or restricting the entry of relevant personnel, products, and means of transportation;
cancelling or restricting the eligibility of relevant personnel to work, stay, or reside within the territory of China.
The relevant measures may apply to organisations actually controlled by foreign organisations or individuals, or in whose establishment or operation foreign organisations or individuals participate. 第二十五条 外国组织、个人危害中国国家主权、安全、发展利益，违反正常的市场交易原则中断与中国企业、其他组织或者个人的正常交易，或者对投资者及其对外投资采取歧视性措施，不合理剥夺或者限制投资者及其对外投资正当权益的，国务院有关部门可以采取禁止或者限制其从事与我国有关的进出口活动，禁止或者限制其在中国境内投资，禁止或者限制中国境内的组织、个人与其进行有关交易、合作等活动，禁止或者限制相关人员、产品、交通运输工具等入境，取消或者限制相关人员在中国境内工作、停留或者居留资格等措施。有关措施可以适用于外国组织、个人实际控制或者参与设立、运营的组织。
Article 27: Where an investor makes an outbound investment that is prohibited by the State, the competent investment department or competent commerce department of the State Council shall, in accordance with the division of duties, order the cessation of the investment activity, order the disposal of shares and assets within a specified timeframe, and confiscate any unlawful gains. Where the investor refuses to comply, a fine of not less than 5% and not more than 10% of the investment amount shall be imposed; the directly responsible officer-in-charge and other directly responsible persons shall be fined not less than RMB 50,000 and not more than RMB 100,000.
Where an investor fails to fulfil the procedures for outbound-investment approval or filing as required, or applies for the relevant approval or filing by submitting false materials, concealing true information, or by similar means, the approval or filing authority shall order rectification, confiscate any unlawful gains, and impose a fine of not less than 1% and not more than 5% of the investment amount. Where the investor refuses to rectify, the authority shall order the cessation of the investment activity, order the disposal of shares and assets within a specified time limit, and impose a fine of not less than 5% and not more than 10% of the investment amount; the directly responsible officer-in-charge and other directly responsible persons shall be fined not less than RMB 20,000 and not more than RMB 50,000.
Where an investor obtains outbound-investment approval or filing by bribery, deception, or other improper means, the approval or filing authority shall revoke the approval or filing document, confiscate any unlawful gains, and impose a fine of not less than 1% and not more than 5% of the investment amount. Where the investment has already been made, the authority shall order the cessation of the investment activity, order the disposal of shares and assets within a specified time limit, and impose a fine of not less than 5% and not more than 10% of the investment amount; the directly responsible officer-in-charge and other directly responsible persons shall be fined not less than RMB 20,000 and not more than RMB 50,000.
From the date on which the penalty decisions provided for in the preceding three paragraphs take effect, the relevant competent department may, for a period of up to 3 years, refuse to accept applications for approval or filing submitted by the violator; or may prohibit the violator from engaging in outbound-investment activities for a period of not less than 1 year and not more than 3 years. 第二十七条 投资者投资国家禁止的对外投资的，由国务院投资主管部门、商务主管部门按照职责分工责令停止该投资活动，限期处分股份、资产，没收违法所得；拒不执行的，处投资额5‰以上10‰以下的罚款；对直接负责的主管人员和其他直接责任人员处5万元以上10万元以下的罚款。 投资者未按规定履行境外投资核准备案手续，或者以提交虚假材料、隐瞒真实信息等方式申请有关核准备案的，由核准备案机关责令改正，没收违法所得，处投资额1‰以上5‰以下的罚款；拒不改正的，责令其停止该投资活动，限期处分股份、资产，处投资额5‰以上10‰以下的罚款；对直接负责的主管人员和其他直接责任人员处2万元以上5万元以下的罚款。 投资者以贿赂、欺骗等不正当手段获得境外投资核准备案的，由核准备案机关撤销核准备案文件，没收违法所得，处投资额1‰以上5‰以下的罚款；已经投资的，责令其停止该投资活动，限期处分股份、资产，处投资额5‰以上10‰以下的罚款；对直接负责的主管人员和其他直接责任人员处2万元以上5万元以下的罚款。 自前三款规定的处罚决定生效之日起，有关主管部门可以在3年内不受理违法行为人提出的核准备案申请，或者禁止其在1年以上3年以下的期限内从事对外投资活动.
Article 28: Where there is a violation of the provisions of Article 15 of these Provisions, namely the refusal to cooperate with the outbound-investment security review, provision of false materials, concealment of relevant information, or non-compliance with the outbound-investment security-review decision, the relevant departments of the State Council shall order rectification, confiscate any unlawful gains, and impose a fine. Where national security is endangered, the violator shall be ordered to take necessary measures to eliminate the impact on national security, and may be prohibited from engaging in outbound-investment activities for a period of not less than 1 year and not more than 3 years; where investment has already been made, the violator may be ordered to cease the investment activity and to dispose of shares and assets within a specified time frame.
Article 29: Where an investor violates the provisions of Article 17 of these Provisions, the competent investment department and competent commerce department of the State Council may, in accordance with the division of duties, order rectification within a specified time frame; where harmful consequences are caused, the violator may be prohibited from engaging in outbound-investment activities for a period of not less than 1 year and not more than 3 years. 第二十九条 投资者违反本规定第十七条规定的，国务院投资主管部门、商务主管部门按照职责分工可以责令限期改正；造成危害后果的，可以禁止其在1年以上3年以下的期限内从事对外投资活动.
Article 32: The administration of investments made by investors in the Hong Kong Special Administrative Region, the Macao Special Administrative Region, and the Taiwan region shall be carried out with reference to these Provisions; where laws, administrative regulations, or the State Council provide otherwise, those provisions shall apply. 第三十二条 对投资者在香港特别行政区、澳门特别行政区、台湾地区投资的管理，参照本规定执行；法律、行政法规或者国务院另有规定的，依照其规定.
Article 33: The administration of investments made by investors using their own funds, raised funds, or other entrusted funds in financial markets outside the territory of China shall be carried out in accordance with these Provisions and other relevant State provisions. The administration of reinvestment outside the territory of China using assets, rights and interests, and the like obtained from outbound investment shall be carried out in accordance with these Provisions and other relevant State provisions. The specific administrative measures for outbound investment by individual residents within the territory of China and other such parties shall be formulated by the competent investment department and the competent commerce department of the State Council. 第三十三条 对投资者以自有资金、募集资金及其他受托资金在中国境外金融市场投资的管理，依照本规定和国家其他有关规定执行。 对投资者以对外投资获得的资产、权益等在中国境外再投资的管理，依照本规定和国家其他有关规定执行。 中国境内居民个人等对外投资具体管理办法，由国务院投资主管部门、商务主管部门制定。
Let’s also look at the explanations provided by officials from the Ministry of Justice, the NDRC, and the Ministry of Commerce. If you’ve read the above document translation, then the entire Q&A isn’t worth going through. But there are some points worth highlighting.
First, what was the need/rationale for the new regulations? The officials said:
“As the once in a century transformation accelerates, geopolitical risks rise, and international competition intensifies, the model of long-standing reliance primarily on departmental rules and normative documents to implement outbound-investment administration and services no longer meets practical needs. There is an urgent need for high-level specialised legislation to elevate effective long-standing measures into legal institutions; better align with high-standard international economic and trade rules; and clarify institutional measures for outbound-investment services, administration, and protection, so as to effectively protect the lawful rights and interests of investors and their outbound investments, safeguard national sovereignty, security, and development interests, and advance the high-quality development of outbound investment along the track of the rule of law. 随着百年变局加速演进，地缘政治风险上升，国际竞争日益激烈，长期以来主要依据部门规章、规范性文件等实施对外投资管理服务的模式已不符合现实需求，迫切需要高位阶专门立法将长期施行的有效措施上升为法律制度，更好对接国际高标准经济贸易规则，明确对外投资服务、管理、保护等方面的制度措施，以有效保护投资者及其对外投资合法权益，维护国家主权、安全和发展利益，在法治轨道上推进对外投资高质量发展.
The formulation of the Regulations is an important measure for implementing the decisions and deployments of the Third and Fourth Plenary Sessions of the 20th CPC Central Committee on improving the system for the administration and services of outbound investment and effectively implementing outbound-investment management. It is an urgent need for coordinating development and security and advancing the high-quality development of outbound investment. It is a major rule-of-law practice through which our country unswervingly expands opening up and advances economic globalization toward a direction that is more open, inclusive, universally beneficial, balanced, and win-win. It has milestone significance in the course of the development of our country’s outward investment. 制定《规定》是贯彻落实党的二十届三中、四中全会关于健全对外投资管理服务体系、有效实施对外投资管理决策部署的重要举措，是统筹发展和安全、推进对外投资高质量发展的迫切需要，是我国坚定不移扩大开放，推进经济全球化朝着更加开放、包容、普惠、平衡、共赢的方向发展的重大法治实践，在我国对外投资发展历程上具有里程碑意义.
The next question is about the process that was followed for designing and drafting these regulations. The officials say that they:
Engaged in written consultations, local investigations, enterprise visits, and expert symposiums; took inputs from different departments, enterprises, industry associations and chambers of commerce, experts and scholars, and lawyers.
This process produced a working draft.
Then the Ministry of Justice conducted three rounds of consultations with more than 100 entities, including relevant central government units, local governments, and relevant people’s organisations; organised multiple expert deliberations, listened to the opinions of enterprises, industry associations and chambers of commerce, experts and scholars, NPC deputies and members of the CPPCC, and carried out field investigations in localities.
It was after all this that the draft was sent to the State Council.
This is an important question: To what circumstances do the Regulations apply? The answer is:
The Regulations summarise long-standing practical experience and clearly stipulate: outbound investment by investors within the territory of the People’s Republic of China is governed by these Regulations. Outbound investment, that is, overseas investment, refers to activities in which investors, by means such as putting in assets and rights and interests or providing financing and guarantees, directly or indirectly obtain ownership, control rights, operational and management rights, and other related rights and interests of enterprises and assets in other countries (regions). ‘Investors’ includes enterprises, other organisations, and resident individuals within the territory of China. The administration of investments made by investors in the Hong Kong Special Administrative Region, the Macao Special Administrative Region, and the Taiwan region shall be carried out with reference to these Provisions; where laws, administrative regulations, or the State Council provide otherwise, those provisions shall apply. 答：《规定》总结长期实践经验，明确规定：中华人民共和国境内投资者对外投资，适用本规定。对外投资即境外投资，是指投资者以投入资产、权益或者提供融资、担保等方式，直接或者间接获得其他国家（地区）的企业、资产等所有权、控制权、经营管理权以及其他相关权益的活动。投资者包括中国境内的企业、其他组织和居民个人。对投资者在香港特别行政区、澳门特别行政区、台湾地区投资的管理，参照本规定执行；法律、行政法规或者国务院另有规定的，依照其规定.
Q: What provisions have been made in the Regulations on outbound investment administration?
A: The Fourth Plenary Session of the 20th CPC Central Committee deployed the effective implementation of outbound investment administration. The Regulations summarise and distil long-standing practical experience in outbound investment administration, and properly coordinate and connect with existing legal provisions:
First, the State shall improve the outbound investment administration system, perfect regulatory measures, implement whole-process supervision on a categorised and tiered basis, strengthen risk prevention and control, raise the scientific basis and security of outbound investment, and promote the combination of investment facilitation with effective risk prevention.
Second, the competent investment department and the competent commerce department of the State Council, together with other relevant State Council departments, shall, based on the needs of national economic and social development and on changes and risk levels in the investment environments of relevant countries (regions), formulate, adjust, and implement outbound-investment policies; clarify outbound investments that are encouraged, restricted, or prohibited; strengthen outbound-investment supervision; and guide and supervise investors in regulating their investment and business conduct.
Third, connecting with existing institutions, the Regulations clarify that where investors are required by law to fulfil procedures such as approval and filing, information reporting, and cross-border capital registration in carrying out outbound investment activities, they shall handle them in accordance with relevant State provisions and submit the relevant materials truthfully.
Fourth, they clarify that the State shall improve the outbound investment security review system; the competent investment department and the competent commerce department of the State Council, together with other relevant State Council departments, shall conduct security reviews of outbound investments, and of the transfer or disposal of related assets, rights and interests, and the like, that affect or may affect national security.
Fifth, strengthening the principal-actor responsibility of investors, requiring investors to regulate their investment and business conduct and not to disrupt the order of the outbound investment market.
问：《规定》在对外投资管理方面作了哪些规定？答：党的二十届四中全会对有效实施对外投资管理作出部署。《规定》总结提炼长期以来对外投资管理实践经验，并与现行法律规定作好协调衔接：一是国家健全对外投资管理体系，完善调控措施，分类分级实施全过程监管，加强风险防控，提高对外投资的科学性、安全性，推动投资便利化和有效防范风险相结合。二是国务院投资主管部门、商务主管部门会同国务院其他有关部门根据国民经济和社会发展需要、有关国家（地区）投资环境变化和风险程度等，制定、调整和实施对外投资政策，明确鼓励、限制、禁止的对外投资，加强对外投资监管，指导、监督投资者规范投资经营行为。三是与现行制度衔接，明确投资者开展对外投资活动依法需要履行核准备案、信息报告、跨境资金登记等手续的，应当依照国家有关规定办理，如实提交有关材料。四是明确国家健全境外投资安全审查制度，国务院投资主管部门、商务主管部门会同国务院其他有关部门对影响或者可能影响国家安全的境外投资及相关资产、权益等的转让、处分进行安全审查。五是强化投资者主体责任，要求投资者规范投资经营行为，不得扰乱对外投资市场秩序.
Q: What provisions have been made in the Regulations on outbound investment protection?
A: As China’s outbound investment participates deeply in international industrial division of labour and cooperation, the need to protect the lawful rights and interests of investors and their outbound investments has become increasingly prominent. The Regulations align with high-standard international economic and trade rules, draw on the relevant laws of the world’s major economies and internationally prevailing practice, and make provisions in four areas:
First, the relevant departments of the State Council shall strengthen monitoring, early warning, and risk assessment of outbound investment; in a timely manner release information on the security situation of relevant countries (regions); flag investment risks; guide and assist investors in carrying out security-risk prevention; and safeguard the State’s overseas interests and the lawful rights and interests of investors.
Second, China shall, in accordance with the international treaties and agreements it has concluded or acceded to, or on the basis of the principle of equality and reciprocity, conduct cooperation and exchanges in the field of law enforcement with other countries (regions), international organisations, and other parties, in order to protect the safety of investors and of the employees and assets belonging to the enterprises and projects in which they invest, as well as the legitimate rights and interests of relevant organisations and individuals. The State shall actively negotiate and sign multilateral and bilateral trade and investment agreements and other international economic and trade agreements, raise the level of protection for outbound investment, and promote the liberalisation and facilitation of investment.
Third, the State shall provide consular protection and assistance, in accordance with the law, to Chinese citizens and organisations investing in other countries (regions), and to the Chinese citizen employees of the enterprises and projects in which they invest in those countries (regions), so as to safeguard their legitimate rights and interests. Where the Chinese government makes evacuation or risk-avoidance arrangements, relevant organisations and individuals shall cooperate.
Fourth, investors are encouraged to resolve disputes related to outbound investment through various means including consultation, mediation, arbitration, and litigation, in order to safeguard their lawful rights and interests.
问：《规定》在对外投资保护方面作了哪些规定？答：随着中国对外投资深度参与国际产业分工合作，投资者及其对外投资合法权益的保护需求日益凸显。《规定》对接国际高标准经济贸易规则，借鉴世界主要经济体的有关法律和国际通行做法，从四个方面作出规定：一是国务院有关部门加强对外投资监测预警和风险评估，及时发布有关国家（地区）安全状况，提示投资风险，指导和帮助投资者做好安全风险防范，维护国家海外利益和投资者合法权益。二是中国根据缔结或者参加的国际条约、协定，或者按照平等互惠原则，与其他国家（地区）、国际组织等开展执法领域合作与交流，保护投资者及其投资的企业、项目所属员工和资产等的安全以及有关组织、个人的正当权益。国家积极商签多双边贸易投资协定等国际经贸协定，提高对外投资保护水平，促进投资自由化便利化。三是国家依法为在其他国家（地区）投资的中国公民、组织及其在该国家（地区）投资的企业、项目所属中国籍员工提供领事保护与协助，维护其正当权益。中国政府作出避险安排的，有关组织、个人应当配合。四是鼓励投资者通过协商、调解、仲裁、诉讼等多种方式化解对外投资有关矛盾纠纷，维护自身合法权益.
The next bit is the meat of the matter:
Question: In recent years, certain foreign governments and organisations have adopted discriminatory measures against Chinese investors and their outbound investments, and have unreasonably suppressed and restricted China’s outbound investment. What response measures have the Regulations stipulated against such circumstances?
Answer: “Economic globalization is the inevitable path of development for human society. China is an active participant in and a firm supporter of economic globalization. China firmly implements the basic state policy of opening to the outside world; works to promote the liberalisation and facilitation of trade and investment; consistently upholds the principle of extensive consultation, joint contribution, and shared benefits; adheres to true multilateralism; opposes unilateralism and protectionism; firmly safeguards a rules-based, transparent, non-discriminatory, open, and inclusive multilateral trading system; safeguards fair competition; and actively participates in global economic governance. In recent years, economic globalisation has encountered counter-currents, with unilateralism, protectionism, and isolationism on the rise; the discriminatory measures of certain foreign governments and organisations against Chinese investors and their outbound investments have severely harmed the legitimate rights and interests of our citizens and organisations and infringed upon our overseas interests. In order to genuinely raise the capability and level of outbound-investment protection and strengthen the intensity of protection, the Regulations stipulate the following measures:
First, regarding trade-related investment barriers or other obstacles to investment and operation imposed by foreign countries (regions), the competent commerce department of the State Council may, on its own initiative or together with relevant departments, conduct an investigation, and based on the investigation results, the relevant departments of the State Council may take measures such as adjusting the relevant country-specific investment policy, or prohibiting or restricting the import and export of relevant goods or technologies.
Second, regarding discriminatory prohibitions, restrictions, or other similar measures adopted by foreign countries (regions) or international organisations in matters such as investment and operation, the Chinese government has the right to take corresponding measures in light of the actual situation, and may, in accordance with the Anti-Foreign-Sanctions Law of the People’s Republic of China and its supporting provisions, impose countermeasures on organisations and individuals that directly or indirectly participate in the formulation, decision-making, and implementation of such measures.
Third, regarding foreign organisations and individuals that endanger China’s national sovereignty, security, and development interests; that, in violation of normal market-transaction principles, interrupt transactions; or that adopt discriminatory measures unreasonably depriving or restricting the legitimate rights and interests of investors and their outbound investments, the relevant departments of the State Council may take measures including prohibiting or restricting their investment within the territory of China, their entry, and relevant transactions and cooperation.
The above measures are necessary measures taken to protect the legitimate rights and interests of Chinese investors and their outbound investments, and to protect the State’s overseas interests from threat and infringement. They are protective and defensive measures. They do not affect normal market-transaction activities, nor do they affect enterprises’ autonomous resolution of commercial disputes in accordance with the law.”
问：近年来，个别外国政府、组织等对中国投资者及其对外投资采取歧视性措施，不合理打压、限制中国对外投资，《规定》针对这些情形规定了哪些应对措施？答：经济全球化是人类社会发展必经之路，中国是经济全球化的积极参与者和坚定支持者。中国坚定实施对外开放基本国策，着力促进贸易和投资自由化便利化，始终秉持共商共建共享原则，坚持真正的多边主义，反对单边主义和保护主义，坚定维护以规则为基础、透明、非歧视、开放、包容的多边贸易体制，维护公平竞争，积极参与全球经济治理。近年来，经济全球化遭遇逆流，单边主义、保护主义、孤立主义上升，个别外国政府、组织等对中国投资者及其对外投资的歧视性措施，严重损害我国公民、组织的正当权益，侵害我国海外利益。为切实提高对外投资保护能力和水平，加强保护力度，《规定》规定了以下措施：一是针对外国国家（地区）与贸易有关的投资壁垒或者其他投资经营障碍，国务院商务主管部门可以自行或者会同有关部门开展调查，国务院有关部门可以根据调查结果采取调整有关国别投资政策，禁止或者限制有关货物、技术进出口等措施。二是针对外国国家（地区）、国际组织在投资经营等方面采取歧视性禁止、限制或者其他类似措施，中国政府有权根据实际情况采取相应措施，并可以依据《中华人民共和国反外国制裁法》及其配套规定等对直接或者间接参与制定、决定和实施有关措施的组织、个人实施反制。三是针对外国组织、个人危害中国国家主权、安全、发展利益，违反正常的市场交易原则中断交易，或者采取歧视性措施，不合理剥夺或者限制投资者及其对外投资正当权益的，国务院有关部门可以对其采取禁止或者限制其在中国境内投资、入境以及有关交易、合作等措施。上述措施是为保护中国投资者及其对外投资的正当权益、保护国家海外利益不受威胁侵害而采取的必要措施，是保护性、防御性措施，不影响正常的市场交易活动，也不影响企业自主依法解决商业纠纷。