The National Development and Reform Commission (NDRC) issued the Administrative Measures for Approval of Outbound Investment Projects (Draft for Consultation) on 16 August 2012. The draft Measures will supersede the Interim Administrative Measures for Approval of Outbound Investment Projects issued by NDRC in October of 2004 after they are adopted and promulgated in due course. The draft Measures do not make any significant changes in the outbound investment project approval and verification process and timeframe set out in the Interim Measures, but they do relax several requirements as well as incorporate a few regulatory changes adopted by NDRC in recent years.
- Removal of overseas subsidiary overseas investment approval requirement - the draft Measures provide that approvals will no longer be required for an overseas investment made by an overseas subsidiary of a domestic company if the domestic company does not provide additional funding or a guarantee to the overseas subsidiary to enable it to carry out the overseas investment.
- Elevated Thresholds for Approval by NDRC - the draft Measures stipulate that outbound investments involving "sensitive countries" and "sensitive industries" will be required to be approved by NDRC or the State Council irrespective of the investment amount. "Sensitive countries" refer to countries or areas which do not have a diplomatic relationship with China, are under international sanctions, have wars or riots or are otherwise identified as "sensitive countries" by NDRC. "Sensitive industries" include basic telecom operations, transborder water resource development and utilization, massive land development, power mains and grid, news media and other industries which are considered to be sensitive by NDRC.