China on Monday released a new regulation on outbound investment, which will officially enter into force on July 1, aiming to further bolster opening-up, while safeguarding national security and development interests.

The regulation highlights China’s commitment to advancing high-level opening-up while balancing development and security. It aims to elevate outbound investment quality, boosts international cooperation and deliver mutual benefits, according to the regulation published on the official website of the central government.

The regulation underscores China’s commitment to aligning its trade and investment rules with global high-standard norms. China will press ahead with high-quality Belt and Road cooperation, beef up bilateral and multilateral investment frameworks, and take an active part in shaping international investment rules. Standing firmly against unilateralism and protectionism, China aims to promote the development of an open world economy, according to the document.

The country supports investors in carrying out overseas investment activities in accordance with market principles and actively participating in international cooperation and competition. Investors are entitled to the right to make independent investments, make their own decisions, bear their own risks, and assume their own profits and losses in accordance with the law, according to the regulation.

Meanwhile, the document sets clear red lines to guard China’s national security and development interests. Investors engaging in overseas investment activities are prohibited from exporting or using goods, technologies, services, and related data that are prohibited from export by the country, or from exporting or using goods, technologies, services, and related data that are restricted from export by the country without permission, according to the regulation.

The regulation also includes a comprehensive outbound investment security review system. National investment and commerce regulators will conduct thorough security checks on overseas deals that may threaten national security, as well as transfers of related assets and rights. All involved enterprises and individuals are required to fully cooperate and abide by review verdicts.

Notably, the regulation also outlines countermeasures targeting unfair foreign business practices. Should foreign entities or individuals undermine China’s sovereignty and development interests, arbitrarily cut business ties with Chinese firms or impose discriminatory restrictions on Chinese outbound investors, relevant central authorities may impose restrictive measures. These include curbing their China-related import and export and investment activities, barring Chinese parties from striking deals with them, and canceling or limiting entry, work and residence permits of their relevant staff.

Global Times