IFLR Publishes Akin Gump Article on China’s New Foreign Investment Law
Akin Gump partner Tatman Savio and associate Cynthia Liu, both members of the firm’s international trade practice, have written the article “China’s opportunity,” which was published by International Financial Law Review.
The article examines China’s new Foreign Investment Law (FIL), which was unveiled earlier this year. Savio and Liu write that it “seeks to consolidate existing foreign investment laws governing equity joint ventures, non-equity joint ventures, and wholly foreign-owned enterprises into one law creating a new foreign investment regime.” The FIL also “provides the basis for a more formal and extensive national security review for foreign investment than exists today.”
Savio and Liu compare the FIL with the Committee on Foreign Investment in the United States, noting that they both “provide broad jurisdiction to subject transactions to the national security review process.” The two also both provide “the potential for companies to mitigate national security risk in particular transactions.”
Concluding, Savio and Liu write that “China has an opportunity to refine its national security review process and narrowly tailor the definition of ‘national security’, as well as the scope of transactions subject to jurisdiction, before implementing the FIL.” By doing so, they add, Beijing would demonstrate “its commitment to encouraging foreign investment, rather than using purported national security concerns as a way to block foreign investors and advance protectionist ends.”
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