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ARTICLE · 24 DECEMBER 2020

China's New Foreign Investment Security Review Measures

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China's National Development and Reform Commission ("NDRC") and Ministry of Commerce ("MOFCOM") jointly promulgated the Measures for the Security Review of Foreign Investment...

ChinaGovernment, Public Sector
Lester Ross
Lester Ross
Kenneth Zhou
Kenneth Zhou
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China's National Development and Reform Commission (“NDRC”) and Ministry of Commerce (“MOFCOM”) jointly promulgated the Measures for the Security Review of Foreign Investment (外商投资安全审查办法) 1 (the “Measures”) on December 19, 2020 which will enter into effect on January 18, 2021. The Measures consists of 23 articles and are intended to provide a clearer legal foundation and procedure for the national security review of foreign investment into China in a manner which China contends is comparable to CFIUS review in the United States and other advanced industrial democracies.2 The Measures are intended to fill a gap in China's foreign investment review system resulting from China's implementation under pressure from its trading partners of a Negative List system with respect to foreign investment, which has reduced China's discretion to reject foreign investments or subject them to onerous restrictions.3

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