Investment restrictions on foreign investors in China
Foreign companies, enterprises or individuals can form equity/contractual joint ventures, wholly foreign-owned enterprises (WFOE), and partnerships in China, subject to approval from the China Ministry of Commerce or other relevant authorities.
The minimum registered capital of a foreign investment enterprise (FIE) is as follows:
As for the industries that the foreign investment is involved, the investment is categorized as encouraged, permitted, restricted and prohibited. Here are some examples of the industries in each category.
Encouraged: scientific research and technical service; certain cultural, sports and entertainment business; water, environment and public facility management; leasing and commercial service; certain manufacturing projects; production and supply of electricity, heat, gas and water; certain agriculture, forestry, and fisheries projects; mining; certain transportation and warehousing services; etc.
Restricted: manufacturing of specified medicines, printing of publications; certain transportation and telecommunications services; wholesale and retail of certain goods; banking, insurance and securities businesses; market surveys, credit investigation and rating services companies; surveying and mapping companies; certain production and supply of electricity, heat, gas and water; higher education, high-school and pre-school educations; medical institutions; certain cultural, sports and entertainment industries, etc.
Prohibited: manufacturing of Chinese patent medicine of secret prescriptions; weapons and ammunition; exploration and exploitation of radioactive minerals, rare earth, tungsten, molybdenum, tin, antimony; certain production and supply of electricity, heat, gas and water, air traffic control; postal services; wholesale and retail of tobacco products; social investigation; consulting on Chinese legal affairs; news agencies, gambling, publication of books and newspaper, publication and production of audio visual products and electric publications; online publication services; auction houses and shops engaged in cultural relics, etc.