China’s legislature is considering a new law governing foreign investment that would streamline rules and prevent the forced transfer of technology, state media reported on Sunday.
The new “unified law” is to replace three existing laws on Chinese and foreign equity joint ventures, non-equity joint ventures and wholly foreign-owned enterprises, Xinhua news agency reported.
A draft of the proposed legislation was presented at a meeting of the Chinese Standing Committee of the National People’s Congress (NPC), which began on Sunday.
When in place, the new law would bar local governments from restricting market access for foreign firms and from forcing them to transfer technology.
This would ensure that foreign investors would enjoy the same privileges as Chinese companies in most sectors except those excluded on a “negative list.”
US and EU officials have long complained of a lack of fair access for foreign companies in China, as well as rampant theft of intellectual property.
“In order to further expand opening up, actively promote foreign investment, protect the legitimate rights and interests of foreign investment, and promote the formation of a new pattern of comprehensive opening, the State Council has proposed a bill,” the committee said in a statement about the meeting posted on the NPC Web site.
The moves signal China’s increased support for the economy as a bruising trade dispute with the US has stymied growth.
Top policymakers on Friday pledged support with tax cuts and other policy measures, including further opening the economy and better protection of intellectual property rights.
Economic data has shown China’s economy slowing this autumn, with consumer spending growing at its slowest pace in 15 years last month and factories easing up on production.
Chinese President Xi Jinping (習近平) and US President Donald Trump agreed to a 90-day tariff truce on Dec. 1, as the two sides try to find a more permanent solution to the trade dispute.
Senior officials from both countries had a telephone conversation on Friday and “made new progress” on several issues, including trade balance and strengthening intellectual property protection, the Chinese Ministry of Commerce said in a statement on Sunday.
The meetings of the NPC, a body of lawmakers headed by committee Chairman Li Zhanshu (栗戰書), are to run until Saturday.
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