BEIJING – China has approved a foreign investment law Friday which includes some of the trade demands made by the United States and Europe.
The measure, which has only been released in draft form, was passed at the end of the National People’s Congress (NPC), an annual meeting of 3,000 delegates in Beijing.
It establishes that foreign investors will be given the same treatment as local investors in an apparent attempt to address Western concerns on economic openness.
Members of the NPC voted in favor of the new rules by an overwhelming majority of 99 percent.
The law is due to come into effect on Jan. 1, 2020.
It also expands the sectors of the Chinese economy that are open to foreign investment, although areas such as research, development, energy, finance, education, infrastructure, agriculture and fishing remain closed.
Another concession to US demands was a promise to better defend intellectual property rights, although the details have not yet been released.
Chinese Premier Li Keqiang said that the measure has been designed to protect the rights and interests of the Chinese people, foreign investors and attract more investment to the country.
It comes after a tariff war between Washington and Beijing, the two largest economies in the world.
The trade battle has seen both sides impose billions of dollars worth of tariffs on each another’s goods since last year.
Li admitted that relations between the two countries have faced “problems and difficulties” but said they both have an interest in resolving them.
As part of his goal to enhance Beijing’s relationship with Brussels, the prime minister announced that he will visit the EU headquarters next month to participate in a China-EU summit.
The EU Chamber of Commerce in China said the law “took into account some of the European Union Chamber of Commerce in China’s comments” but that it is “concerning” it is only a final draft.
“Its vague wording further adds to the legal uncertainty that the law creates for foreign companies,” it said in a statement.
“More than anything else, foreign companies want equal treatment and opportunities,” said Mats Harborn, president of the European Union Chamber of Commerce in China.
“While not all of our concerns were addressed in this law, it is time to move forward. We will closely monitor the FIL’s (foreign investment law) implementation to ensure that it is fully respected at all levels of government and in all corners of this country.”