The impact of the new Chinese Foreign Investment Law 2019 on the administrative legal system governing foreign investments and implications for the investment relations with Lusophone Markets

Author:Muruga P. Ramaswamy
Pages:330-343
SUMMARY

In March 2019, China revamped its domestic legal regime governing foreign investments with a new Foreign Investment Law that will enter into force in 2020 (‘FIL- 2019’). The paper examines how the new law impacts the administrative control of foreign investments in China. Given the past approach of China, using administrative legal measures in diverse legal instruments to regulate foreign... (see full summary)

 
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The impact of the new Chinese Foreign Investment Law 2019
on the administrative legal system governing foreign investments
and implications for the investment relations with Lusophone Markets1
Associate professor Muruga P. RAMASWAMY2
Abstract
In March 2019, China revamped its domestic legal regime governing foreign
investments with a new Foreign Investmen t Law that will enter into force in 2020 (‘FIL-
2019’). The paper exa mines how the new law impacts the administrative control of foreign
investments in China. Given the past approach of China, using administrative legal measures
in diverse legal instruments to regulate foreign investments, how the FIL 2019
abolishing/consolidating those instruments increases or decreases the scope of
administrative control of foreign investment is an intriguing question facing foreign investors
and administrative law scholars alike. In a similar vein, the potential implications of the new
FIL 2019 upon specific foreign investment relations becomes equally significant. The FIL
2019 could not only trigger new reciprocity concerns viz-a-viz certain host states of Chinese
outward investments, but also may demand the revision of some existing Chinese BITs with
foreign states. The paper makes a brief reference regarding the general implications of the
new law upon the investment relations with specific Lusophone host markets (for which,
Macau SAR is the official facilitator of Economic Relations). Based on the findings, the paper
concludes with a discussion on some future course.
Keywords: foreign investments, administrative control, PRC administrative law,
Foreign Investment Law 2019.
JEL Classification: K22, K23
1. Introduction
Administrative legal regime of the People’s Republic of China (PRC) is an
intriguing field of research for any comparative legal study, due to its unique
characteristics and distinct flavour. The nature of the PRC administrative legal
system has even impelled questions regarding its very existence as an independent
discipline of law. The absence or limited recognition of certain typical elements,
which are generally found in administrative law, like for example, the right to seek
judicial review of administrative action has prompted such challenges. Moreover,
the general concerns regarding limitations of separation of powers or rule of law in
the PRC have also added further impetus for such arguments. However, many of the
related debates may not stand enough ground today due to the substantive growth
and transformation of field of administrative law in the PRC during the last three
decades.
1 The author would like to acknowledge and thank the support of the University MYRG project grant
related to the paper.
2 Muruga P. Ramaswamy - Faculty of Law, University of Macau, Macau, China, rmp@umac.mo.

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