Authored by REN Gulong( at AnJie Law Firm 

The State Council, China’s cabinet, released on 18 November 2014 a List of Investments That Requires Governmental Approval (2014 version) dated 31 October 2014 (“2014 List”).  The 2014 List provides a much shorter list of investments projects needing government approval.


In the 2014 List, except for investments in sensitive countries or regions or investments in sensitive industries, which are still subject to approval by National Development and Reform Commission (“NDRC”), no governmental approval will be required for any outbound investment (“ODI”) by Chinese investors. Filing with NDRC will be required for any outbound investment above US$ 300 million

Sensitive countries or regions or sensitive industries are not defined in the 2014 List.  According to the Rules On Approval And Filing Of Outbound Investments issued by NDRC and effective since 8 May 2014,


Sensitive countries or regions mean countries or regions that are at war, or countries under international sanctions or without diplomatic relations with China.

Sensitive industries include: fundamental telecom operation, cross-border water resource development, large scale land development, electricity mains and network, news press.


The 2014 List is a further relaxation of restrictions on investments since the revision and simplifying in 2013.  The 2013 list has reduced restrictions on ODI significantly and only outbound investments in sensitive countries or regions or investments in sensitive industries, and investment over US$ 1 billion are subject to NDRC approval. Filing with NDRC are only required for an outbound investment above US$ 300 million.


In the past decade, Chinese enterprises have been keen on ODI, particularly in the industries of infrastructure, energy, minerals and agriculture.  According to the statistics released by Ministry of Commerce (“MOFCOM”) on 18 November 2014, China’s ODI by non-financial companies rose to $81.88 in the first ten months of 2014, a 17.8 percent raise from a year ago.  ODI grows robustly in comparison with foreign direct investment (FDI) in China, which has dropped 1.2 percent year on year to $95.9 billion in the first 10 months of 2014, according to MOFCOM.  With ODI growth in the near future, China will soon become a net capital exporter.  By end of this October, China’s aggregate ODI reaches to US$ 625.3 billion, ranked behind United States and Japan.


The 2014 List, which further eliminates barriers for outbound investments, will facilitate Chinese companies in direct investments and mergers and acquisitions in overseas market