China Tightens Scrutiny of Outbound Investment

Outbound investment is to face increased scrutiny, according to a recent statement from the Ministry of Commerce. In order to reduce future outbound investment risks, enterprises will now be obliged to improve all relevant record-filing systems, while enhanced operational and post-operational oversight will be enforced to ensure all going-out activities are conducted in a well-regulated and efficient manner.

The Ministry of Commerce’s statement came in the wake of the Guidelines for Further Guiding and Regulating Outbound Investment Directions, which was jointly published by four government departments back in early August. This earlier publication detailed government plans to blacklist any businesses failing to comply with the existing outbound investment rules and to impose penalties on all parties to any investments that contravened the required protocols.

For further details (in Chinese), please refer to the following links:

Regular Press Conference of the Ministry of Commerce (28 September 2017)

Circular of the State Council General Office on Forwarding the Guidelines of the National Development and Reform Commission, Ministry of Commerce, People’s Bank of China and Ministry of Foreign Affairs for Further Guiding and Regulating Outbound Investment Directions (Guo Ban Fa No. 74 [2017])