Unlike the 2017 version, the New National Negative List is no longer divided into two separate lists setting out industries restricted or prohibited from foreign investment respectively, but captures all special measures (including any restriction or prohibition of foreign investment and specific requirements on the foreign ownership or senior management) applicable to foreign investment in a consolidated table form.
Compared with the 2017 version, the New National Negative List pares down the special measures for foreign investment from 63 items to 48 items. The further opened up industrial sectors include financial services, transportation and logistics, commercial and trading, professional services, manufacturing, infrastructural, energy and resources and agriculture.
We set out below a few examples:
- Financial services sector: The restrictions on foreign shareholding in domestic banks are eliminated, and the cap of foreign shareholding in securities companies, fund management companies, futures companies and life insurance companies is raised to 51 per cent.
- Agricultural sector: The restriction on foreign shareholding in the production of seeds of agricultural crops (except the seeds of wheat and corns) is eliminated.
- Infrastructural facilities sector: The restriction on foreign shareholding in the construction and operation of truck railway lines and the railway passenger transport companies is eliminated.
- Transportation and logistics sector: The restriction on foreign shareholding in the design, building and repair of vessels, the international marine transportation and the international ship agency is eliminated.
- Commercial and trading sector: The restriction on foreign investment in the construction and operation of gas stations and the wholesale and retail of rice, wheat and corns is eliminated.
- Cultural sector: The prohibition on foreign investment in internet cafes is eliminated.
The New National Negative List also sets out a roadmap and timetable for yet further opening-up of the financial services and automobile sectors in the next few years. According to these provisions, all foreign shareholding restrictions in the financial services sector will be lifted in 2021. Foreign shareholding restriction on the manufacturing of commercial vehicles and passenger vehicles will be lifted in 2020 and 2022 respectively. The current restriction that a foreign investor may establish no more than two joint ventures that manufacture the same category of whole vehicle products will also be removed in 2022.