China's Pilot FTZs: New Negative List further relaxes foreign investment sectors 

Issue 21 - 7 May 2015

China’s General Office of the State Council released a new “Negative List” on 20 April 2015 that further relaxes foreign investment sectors; the list was released with the framework plans for three new pilot free trade zones (FTZs) in Fujian, Guangdong and Tianjin. As from 8 May 2015, the Negative List will be applied in these Pilot FTZs, as well as in the Shanghai Pilot FTZ (in the latter FTZ, the new Negative List will supersede the 2014 list).

The Negative List sets out the sectors in which foreign investment is either restricted or prohibited. Foreign investors engaged in activities that are not included on the list will enjoy the same treatment as domestic investors (i.e. national treatment), so it will not be necessary to obtain pre-approval for a foreign investment project or to set up a foreign-invested enterprise. Instead, a filing (i.e. reporting) requirement will apply. If a more favorable policy is granted to foreign investors under a free trade agreement or other similar agreement (notably certain policies applicable to investments from Hong Kong, Macau or Taiwan in Guangdong or Fujian granted under the Mainland and Hong Kong/Macau Closer Economic Partnership Agreement or the Economic Cooperation Framework Agreement), the provisions of that agreement will prevail.

The 2015 Negative List reduces the number of "special (restrictive) measures" from 139 to 122, indicating that the government generally is expanding foreign access. Major sectors in which restrictions have been lifted by this revision include the following:

Please follow the link for a copy of the new Negative List in Chinese. You may also access the relevant information and regulations about Pilot FTZs via Deloitte's dedicated portal page.