China passes new law to help foreign firms after positive feedback from US in trade talks
- The law, which will come into effect on January 1 next year, aims to create a ‘stable, fair, transparent and predictable’ business environment
- A draft of the regulation was provided to US trade negotiators during talks in Washington earlier this month and received a warm response
China has passed a new law aimed at cutting red tape and levelling the playing field for foreign firms operating in the country, after a draft copy received positive feedback from the United States, a key member of China’s trade negotiation team said on Wednesday.
“It is an open document and both sides exchange open documents,” said Ning, who is also deputy chairman of China’s National Development and Reform Commission and the chief of the National Bureau of Statistics. “We were negotiating on an equal base. The reaction [from the US] was very good.”
The draft regulation, which was released for feedback in July, was among a number of policy documents China exchanged with US negotiators to show Beijing was taking steps to streamline its business environment and become more friendly to foreign firms, Ning said.
Under the new regulation, China will stick to a market-oriented direction to create a “stable, fair, transparent and predictable” business environment, according to the state-owned Xinhua News Agency. It will also fully protect the autonomy, property rights and other legitimate interests of businesses.
But by taking steps to enhance intellectual property rights and become more business friendly, China is expecting Washington to reciprocate by improving its treatment of Chinese businesses in the US, Ning said.
“Improving the business environment should be mutual – we will improve ours and the US should also improve theirs to help Chinese companies,” he said.
US President Donald Trump has launched a barrage of complaints at China since starting a tit-for-tat trade war 15 months ago, including unfair treatment of American companies seeking market access and government procurement, as well as forced technology transfer to Chinese partners and weak intellectual property protection.
The two sides reached an interim agreement on what Trump called a “substantial phase one deal” earlier this month. Trade negotiators are working on the text of a trade deal that the US president and President Xi Jinping could sign in mid-November when they meet at the Asia-Pacific Economic Cooperation summit in Chile.
Ning said China was no longer chasing “double digit” gross domestic product growth, but was instead looking at ensuring people’s jobs and incomes.
But even as Beijing tries to woo foreign investors, it is drafting an “unreliable entity list” for overseas businesses that could see firms sanctioned for hurting Chinese interests.
Zhang Yaobo, an official with China’s Ministry of Justice, said at the press briefing on Wednesday there would be “no retaliation” against foreign companies for making appeals in Chinese courts.