The foreign investment law passed at the second session of the 13th National People's Congress on March 15 is a milestone in China's economic and legislative history, demonstrating China's firm stance of advancing reform and opening up and supporting globalization.

If international trade and investment are the two engines of globalization, then developing foreign trade and actively utilizing foreign capital are the two magic weapons of China's opening-up strategy. In recent years, competition among countries to attract international capital has become increasingly fierce. As the major developed countries of traditional capital exporting countries, they have also introduced policies in reindustrialization and tax reduction to attract investment. At the same time, some countries have introduced some measures to restrict international investment under various names. In this context, the foreign investment policy is becoming more and more a vane of China's reform and opening up. Clearly, the enactment of foreign investment law is a key measure to promote the further opening up of China's economy under the new situation. The foreign investment law places special emphasis on investment promotion and protection, and has a clear intention to improve the investment environment, attract foreign investment and open up to the outside world.

The foreign investment law, which combines the original three laws on foreign investment into one, has become a key law regulating the attraction of foreign investment and the development of export-oriented economy in China. The law regulates some basic legal issues concerning foreign investment, especially the implementation of pre-establishment national treatment plus negative list management. Pre-establishment national treatment and negative list management are new concepts in the field of international investment policy.

In fact, in the formulation of the foreign investment law, the foreign investors' demands and the domestic legislation present the benign interaction in many aspects. In terms of specific contents, some new clauses explicitly respond to the specific appeals of the outside world in recent years, involving the equal treatment of foreign-funded enterprises in standardization work and government procurement, the issuance of stocks and corporate bonds by foreign-funded enterprises in China, and the equal application of various policies of the state to support the development of enterprises in accordance with the law. In addition, the foreign investment law pays special attention to the protection of the legitimate rights and interests of the intellectual property right holders, and emphasizes that no administrative means shall be used to force the transfer of technology. In the third draft, there is a special provision on strict legal liability for intellectual property infringement, and in the final version, there is a special provision that stipulates that administrative organs and their staff must keep strictly confidential the trade secrets of foreign investors and foreign-invested enterprises.

The implementation date of the foreign investment law is determined to be January 1, 2020. As a basic law in the field of foreign investment, its implementation also needs to formulate some regulations or implementation rules to support. It is foreseeable that the implementation of the law will set off a new wave of foreign investment, especially in emerging industries, key enterprises and major projects. At the same time, the implementation of the law will also promote the improvement of China's entire foreign investment policy system. The author believes that, on the basis of the foreign investment law, the foreign investment policy can be optimized based on the principle of "negative list + positive encouragement + neutral competition", which involves the two stages of enterprise investment and operation, especially the latter.

In fact, the significance of foreign investment law has gone far beyond the field of foreign investment. It is one of the legislative principles of the foreign investment law that domestic and foreign investment are consistent. This law is of great significance for perfecting the basic system of the export-oriented market economy and building the enterprise policy system based on the principle of competition neutrality. A distinctive feature of the foreign investment law is the restraint on government actions and the emphasis on fair competition. Its adoption and implementation will help optimize the relationship between government and business, and form a legal environment for equal competition and fair competition among enterprises with various forms of ownership in the Chinese economy.

Source: China financial information network