China has published rules to review foreign investment for national security reasons, as potentially widespread measures in a number of vital sectors in the country.
The review system announced by the National Development and Reform Commission covers foreign investment in the military sectors and the acquisition of controlling stakes in sectors such as energy, natural resources, agriculture, internet technology, and financial services.
“Only by tightening protection against security risks can China lay solid foundations for a new round of openness that is wider and deeper,” the committee said.
“This is in line with international practices and will help balance the economic benefits of more openness and the need to ensure national security,” she added.
She stressed that “spreading investment rules is not a retreat from openness policies,” stressing that “openness without protection is not sustainable.”
She noted that “major economies such as the United States, the European Union, Australia, Germany and Japan have established or improved their review mechanisms for foreign investment in recent years.”
The announcement comes as US President Donald Trump escalates tensions with China in his final weeks in office, as Washington added dozens of Chinese companies to its commercial blacklist on Friday.
The new system will establish a body dedicated to security reviews, headed by the National Committee and the Ministry of Commerce, and the rules that come into effect within 30 days will follow the Foreign Investment Law that was published last year with the aim of expanding foreign investors’ access to markets.