I. Key Points of Policy Content

 

Overview: In April 2025, the National Development and Reform Commission, the Ministry of Commerce, and the State Administration for Market Regulation jointly issued the "Negative List for Market Access (2025 Edition)", which came into effect from the date of release and abolished the 2022 edition. The main changes of this new version (compared with the 2022 version) - Summary points are as follows:

 

1.The overall number of restricted items has been reduced: The number of restricted/prohibited items has decreased from 117 to 106, indicating further relaxation of market access.

2. Further liberalization of manufacturing and high-end manufacturing: Foreign investment access in areas such as new energy vehicles, intelligent manufacturing, and advanced equipment has been relaxed, and foreign investment is encouraged to participate in industrial chain upgrading and local production.

3. Relax access to certain service sectors: In areas such as medical rehabilitation, elderly care services, professional logistics, transportation and maintenance, the provisions for foreign investment entry will be relaxed, allowing for broader foreign investment participation and forms of ownership.

4. More refined management of some Internet and digital health businesses: Online drug sales, online circulation of medical devices, Internet information services, etc. have moved from the previous ambiguous management to more explicit licensing and regulatory requirements (that is, to liberalize some while imposing stricter regulations on safety and qualifications).

5. Add or retain specific safety bottom line items: Strengthen restrictions or include negative lists on areas that may affect safety and public health, such as drones and e-cigarettes (new tobacco products), to "ensure the safety bottom line".

6. Parallel implementation of local policies and encouragement of opening up: The document also encourages free trade zones, economic development zones, etc. to adopt more convenient and encouraging measures to attract foreign investment without violating the overall national framework.

The official statement of the Chinese government summary: Relevant state departments pointed out that this revision embodies the principle of "taking the list as the benchmark and opening up all areas outside the list", aiming to lower market access thresholds, stimulate market vitality and social capital, and promote high-quality opening up.

 

Ii. Interpretation by the chivoy lawyers Team (Personal Opinion

 

1. Policy Purpose 

(1) Boost foreign investment confidence and stabilize the scale of foreign investment - Against the backdrop of global investment fluctuations and trade frictions between China and foreign countries, attract foreign investment to return through a clearer and more open market access system and promote the long-term landing and reinvestment of foreign investment.

(2) Guide industrial upgrading and technology introduction - Selectively relax foreign investment access in high-end manufacturing, new energy, professional medical care and other fields, aiming to promote the modernization of industrial chains and the spillover effect of technology through foreign investment.

(3) Strengthen regulatory boundaries in openness - Impose more refined restrictions or licensing requirements on sensitive or public safety-related areas such as online drug sales, drones, and e-cigarettes, embodying the regulatory principle of "equal emphasis on openness and bottom lines".

 

2. Policy Context

(1) Domestic economic structure adjustment and expansion of domestic demand: Against the backdrop of sluggish consumption recovery and deleveraging in the real estate and some industries, China has been stimulating market vitality and the impetus for technological upgrading by expanding its opening up to the outside world. This revision of the list is precisely the institutional support of macro policies in the chain of "attracting investment - introducing technology - improving efficiency".

(2) A link in the long-term reform trajectory: Since the "negative list" was first introduced in 2018, the state has gradually reduced the restricted items through multiple rounds of revisions. The 2025 version is an important advancement on this institutionalized path, taking into account both international commitments and domestic policy goals.

(3) Impact on Foreign Investors' Investment in China

 

Opportunities - broader entry channels and more industries to choose from

· Manufacturing and high-end equipment: Foreign capital can seek more localized cooperation and factory establishment opportunities in the fields of new energy vehicles, key components and intelligent manufacturing. Policies encouraging foreign investment to participate in the upgrading of industrial chains are conducive to technology introduction and joint ventures and cooperation.

· Professional services and medical rehabilitation, elderly care: The market access threshold for foreign-funded medical, rehabilitation, elderly care and high-end service industries has decreased, which is beneficial to overseas medical groups, elderly care service operators and nursing technology providers.

· Local development zones and free trade zone Windows: In specific free trade zones or national-level development zones, more flexible policy support, tax/land/approval conveniences and other supporting benefits can be obtained.

 

Risks and Limitations - Specific fields remain strictly controlled and compliance requirements are more detailed

There are still restrictions on sensitive industries: Drone manufacturing, new tobacco products, etc. have been clearly included in the scope of control. Projects involving national security, public health and information security may still be restricted or require conditional approval.

There are compliance thresholds for online medical and data-related businesses: Although some online medical services and drug circulation have been liberalized, there are stricter requirements for holding licenses and qualifications (such as MAH), supply chain compliance, and cross-border data flow. Investors need to incorporate regulatory compliance costs into the design of their business models.

Differentiated implementation of local and industry rules: Although central documents promote relaxation, local authorities can still introduce supporting regulations based on local realities and industrial policies during implementation. Foreign investors need to pay attention to local detailed rules and operational interpretations.

 

3. Practical Advice (How: For Foreign investors planning to enter China or expand their business in China)

(1) Industry access and negative list due diligence (primary). Compare each item of the 2025 negative list with the business to be invested in one by one to determine whether it falls outside the "prohibited/permitted/negative list". For businesses in the "licensing" or ambiguous zone, the required qualifications and approval paths should be determined in advance.

(2) Structured entry scheme (Joint venture/wholly-owned/pilot). For still restricted areas, priority should be given to joint ventures or cooperation with local licensed institutions. For businesses that can be piloted and opened up, priority should be given to choosing free trade zones or local pilot projects for trial operation first to verify compliance and business models.

(3) Regulatory compliance first - Qualifications, data and supply chain. If it involves medicine, online services or cross-border data, qualification materials such as MAH and GSP/GMP, data protection compliance plans and supply chain traceability capabilities should be prepared simultaneously.

(4) Site selection and policy alignment (local alignment strategies). Compare the landing support measures (taxation, land, financial subsidies, talent policies) of the target provinces and cities, and through the business representative office or law firm, assist in striving for a "dedicated team follow-up" and preferential matching.

(5) Embed compliance protection clauses in merger and acquisition and transaction documents. Incorporate "negative list/approval condition release clause", post-merger compliance transition plan and consideration adjustment mechanism into M&A agreements to reduce transaction risks brought about by approval uncertainties.

(6) Taxation and fund arrangement proceed in parallel. When taking advantage of the Chinese market to gain scale and profits, plan in advance for reinvestment of profits, tax incentives and foreign exchange remittance mechanisms to avoid cash flow and tax compliance shocks in the later stage.

 

The Negative List for Market Access (2025 Edition) strikes a balance between "further liberalization" and "strictly controlling the safety bottom line", providing more operational channels and business opportunities for foreign capital to enter China. For foreign investors who wish to enter or expand their business in China, now is a good opportunity to make early preparations and choose an appropriate entry model. However, at the same time, compliance must be the prerequisite, and industry qualifications, data and security requirements, local implementation differences, etc. must be incorporated into the project design and budget.