On August 21, 2026, the National Development and Reform Commission (the NDRC) issued the Measures for the Administration of Outbound Investment (Revised Draft for Public Comment) (the Draft Measures), which made systematic revisions to the Measures for the Administration of Outbound Investment by Enterprises (Order No. 11 of the NDRC; Order No. 11). On October 22, 2026, the NDRC formally issued the Measures for the Administration of Outbound Investment (the Measures), which will take effect on December 1, 2026 on which Order No. 11 will be repealed. The Measures respond to the significant growth of China’s outbound investment in recent years and the profound and complex changes in the external environment, as well as the implementation of the Provisions of the State Council on Outbound Investment issued in June this year (the New State Council Regulation). They also reflect the latest regulatory trends of the NDRC with respect to outbound investment.
The Measures comprise 76 articles in six chapters i.e.,: General Provisions, Guidance and Services for Outbound Investment, Oversight of Outbound Investment, Protection of Outbound Investment, Legal Liability and Supplementary Provisions. Compared with the Draft Measures, the final Measures retain the same chapter divisions, number of articles, numbering and the order of the articles. There are two articles with substantive modifications in their content: Article 14 relaxes the deadline for submitting an ex-ante report for a non-sensitive overseas reinvestment project from at least 20 working days to at least 10 working days before the implementation of the investment; and Article 54 extends the deadline for submitting the annual outbound investment information report from March 31 to June 30 each year.
I. Key Changes under the Measures
(A) Outbound direct investment is extended to resident individuals and other organizations
Order No. 11 expressly states that it does not apply where a domestic natural person directly makes an outbound investment.
Outbound direct equity investment by domestic resident individuals has primarily been conducted under the Notice of the State Administration of Foreign Exchange on Issues Concerning Foreign Exchange Administration for Domestic Residents Engaging in Outbound Investment and Financing and Round-trip Investment through Special Purpose Vehicles (No. 37 [2014] of the State Administration of Foreign Exchange). That notice, however, addresses outbound investment or financing combined with round-trip investment and does not generally apply to ordinary, standalone outbound equity investments. 1
Historically, domestic individuals have also made outbound equity investments through domestic enterprises established by them. When a resident individual establishes a new domestic enterprise specifically for outbound investment, this rapid establishment followed by outbound investment is of regulatory concern requiring particular scrutiny and may make the outbound direct investment filing or approval more difficult.
For the first time, the New State Council Regulation recognizes domestic resident individuals as outbound investors through legislation (in addition to the foreign-exchange registration route described above). In response to this higher-level regulation, the Measures provide for the first time that resident individuals as investors are subject to the same outbound-investment approval, filing and overseas reinvestment reporting procedures as enterprises and other organizations. This change fills a longstanding regulatory gap at the departmental-rule level concerning resident individuals as outbound investors. Article 13 of the Measures provides that: ‘If the investor is a resident individual, the filing authority shall be the development and reform department of the provincial-level government at the place of the investor’s household registration or habitual residence’. However, the Measures do not define domestic resident individuals. It remains unclear whether the definition is based on habitual residence, nationality or both. From a tax law perspective, the Individual Income Tax Law of the People’s Republic of China defines a resident individual as ‘an individual who has a domicile in China, or who has no domicile in China but has resided in China for an aggregate of 183 days or more in a tax year’. That definition may offer some guidance but cannot necessarily be applied directly given the different regulatory purposes of the two instruments. The definition of domestic resident individuals in the context of outbound investment regulation awaits further clarification by the competent authorities.
For outbound investment directly made by resident individuals, the procedures and operational guidance concerning the regulation of outbound direct investment by the Ministry of Commerce of the People’s Republic of China (MOFCOM) or the competent local commerce authorities, foreign-exchange registration and the outward remittance of individual funds are still awaiting new rules from other government departments, as well as corresponding supporting documents.
The Measures also cover other organizations as investors including public institutions, social organizations and other non-enterprise bodies.
(B) Clarifying when ODI regulation applies to outbound investments made through QDIIs and similar channels
Question 32 of the NDRC’s FAQs in July 2021 on the Approval and Filing of Outbound Investment stated: ‘If an investor makes overseas investment through QDII, QDLP, QDIE or other channels and such investment activities constitute outbound investment as defined in Article 2 of Order No. 11, the investor shall complete the relevant outbound investment procedures in accordance with Order No. 11’. Because this point was not expressly addressed in legislation, it has been interpreted and implemented inconsistently in practice.
Article 73 of the Measures addresses this issue. As a rule, investment in overseas financial markets through QDII, Southbound Stock Connect, Cross-boundary Wealth Management Connect and similar channels is not subject to the direct outbound-investment filing/approval procedures administered by the development and reform authorities or overseas reinvestment reporting. The exceptions are: (1) when following the investment, the investor, alone or together with persons acting in concert, acquires control of the investee enterprise; (2) following the investment, when the investor, alone or together with persons acting in concert, holds an aggregate percentage of the equity or voting rights in the investee enterprise that reaches an integral multiple of 10%; or (3) when other circumstances as specified by the NDRC apply.
(C) Earlier regulatory intervention and broader oversight of overseas reinvestment
1. New preparatory-work reporting systems
The Measures introduce an ex-ante reporting system for material preparatory work. Article 41 requires an investor to submit a Report on Preparatory Work for Outbound Investment through the online system at least 10 working days before undertaking material preparatory work (1) where the Chinese investment amount reached USD 100 million or more, or (2) where the outbound investment concerns China’s diplomatic relations with a relevant country. Material preparatory work includes: (1) making an investment commitment to a foreign government; (2) signing an investment agreement or similar document; and (3) other preparatory work that may affect China’s diplomatic relations with a particular country.
If the entity implementing an outbound investment is an overseas Sino-foreign joint venture, different interpretations may arise in practice as to how the Chinese investment amount should be calculated. Based on our communications with a local development and reform department on a recent project, we understand that, for the portion contributed directly by the overseas entity, the Chinese investment amount should be calculated by multiplying the amount of the outbound investment made by that entity by the Chinese shareholder’s shareholding percentage.
This reporting system resembles but is not identical to the pre-signing reporting system under the Measures for the Administration of Approval and Filing of Outbound Investment Projects (Order No. 9 of the NDRC; Order No. 9), which applied before Order No. 11. Both involve ex-ante regulatory intervention before an outbound investment agreement is signed but differ in the scope of the projects covered and in whether the development and reform authorities issue a document akin to an administrative approval.
The ex-ante reporting system in Article 10 of Order No. 9 applied to overseas acquisitions or bidding projects with a Chinese investment amount of USD 300 million or more and required the NDRC to issue a confirmation letter (commonly known as pre-clearance) as evidence that the project complied with China’s outbound investment policies. The Measures, however, cover a broader range of projects, with a lower Chinese investment threshold of USD 100 million, and without being limited to acquisitions or bidding projects; they also incorporate, as an additional assessment factor, considerations relating to diplomatic relations.
Article 45 of the Measures further provides that: ‘An investor shall be deemed to have completed its outbound investment information reporting once the outbound investment information report it submits is true, accurate and complete. An investor requiring evidence may print a certificate of completed submission through the online system. Where a development and reform department discovers any failure to report, misreporting or omission of information relating to outbound investment, it shall notify the investor to submit a supplementary report or make corrections. If, after receiving an outbound investment information report submitted by an investor, a development and reform department discovers that the outbound investment or related activities do not comply with the relevant laws, regulations or policies, it shall take regulatory measures in accordance with Article 17 of these Measures’. The NDRC does not need to issue a written response or a confirmation letter for a Report on Preparatory Work for Outbound Investment. It nevertheless retains the power to require the investor to supplement or correct information.
For material matters arising during an outbound investment, the development and reform authorities may also issue an inquiry letter on material matters (Article 43 of the Measures) and require the investor to submit a written response within a prescribed time period. Therefore, although the newly introduced ex-ante reporting system for material preparatory work is not formally an approval system, the development and reform authorities retain the power to conduct a substantive review of the report. The Measures do not provide that the contents of a report will be automatically deemed accepted if no response is given within a prescribed period. In practice, the online system may display the status of a report’s submission and review, and an enterprise may still need to await confirmation from the system before proceeding with the outbound investment procedures, depending on how the system is updated to implement the new rules. For example, Article 42 of Order No. 11, concerning ex-ante reporting for large, non-sensitive overseas reinvestment projects, provides: ‘Where the information in a Report on a Large Non-sensitive Project submitted by an investor is incomplete, the NDRC shall, within five working days of receipt, notify the investor in a single notice of all information that needs to be supplemented or corrected. If no notice is given within that period, the information shall be deemed complete’. However, there have been cases where the online system continued to show a report as ‘under review’ after more than five working days. We understand that the enterprise should still await completion of that review.
In relation to the inquiry-letter system under Article 43, the Measures provide that: ‘Where a development and reform department considers it necessary, it may make public the inquiry letter on material matters and the written report submitted by the investor’. Publication turns a non-public regulatory inquiry into public information. Once a matter enters the public domain, it may affect an enterprise’s reputation and create stronger incentives for compliance. The competent authorities will, however, also need to balance the protection of trade secrets against the public interest.
The evolution of the ex-ante reporting system from Order No. 9 through Order No. 11 to the Measures is instructive. Order No. 11 reflected the policy of streamlining administration and delegating powers in response to the growth of China’s outbound investment. In contrast, the Measures are shaped more by the complex and volatile international political and economic environment of recent years – including instability, policy shifts and rising political and security risks in certain countries and regions – and signal a clear intention to strengthen the oversight of outbound investment.
2. Broader scope of overseas reinvestment reporting
(1) Removal of the Chinese investment threshold for overseas reinvestment reports
Article 14 of the Measures substantially expands the coverage of overseas reinvestment reporting. Order No. 11 only covers large, non-sensitive overseas reinvestment projects with a Chinese investment amount of USD 300 million or more. The Measures extend the system to all non-sensitive overseas reinvestment projects and with no monetary threshold. They specify, more precisely than Order No. 11, that the report must be submitted at least 10 working days before the investment is made.
This revision will substantially extend investors’ compliance obligations for overseas reinvestment. Once the new rules take effect, subsequent acquisitions, capital increases, profit reinvestments and similar activities undertaken by an overseas entity controlled by a domestic enterprise using its own offshore funds will trigger an overseas reinvestment reporting obligation, regardless of the amount. Corporate groups that have established multi-tier offshore holding structures and continue to reinvest abroad will face ongoing compliance-reporting pressure.
Attention should also be paid to cases where a Chinese domestic enterprise acquires equity in an overseas enterprise through an acquisition or the establishment of an overseas enterprise, and jointly control that enterprise with the foreign shareholders thereof. Under Article 2 of the Measures, control means directly or indirectly holding half or more of the voting rights in an enterprise or other organization, or, despite not holding half or more of the voting rights, being able to direct important matters such as its operations, finances, personnel or technology. In a joint-control structure, however, the Chinese shareholder typically does not satisfy the ‘half or more of the voting rights’ criterion. The overseas enterprise’s principal assets and business are located outside China, and the Chinese shareholder does not have unilateral power to direct the important operational, financial, personnel or technological matters, but instead exercises joint control with the foreign shareholder. Whether overseas reinvestment by such an overseas joint venture also requires an overseas reinvestment report awaits further clarification and/or interpretation by the outbound investment regulators. As the Chinese and foreign parties jointly control the overseas enterprise, the Chinese party may be unable to complete the report on its own if the foreign party does not agree to report the reinvestment. We will closely monitor these developments in regulatory practice.
Another change warrants attention. Article 42 of Order No. 11, concerning ex-ante reporting for large, non-sensitive overseas reinvestment projects, provides that: ‘If the information in a Report on a Large Non-sensitive Project submitted by an investor is incomplete, the NDRC shall, within five working days of receipt, notify the investor in a single notice of all information that needs to be supplemented or corrected. If no notice is given within that period, the information shall be deemed complete’. The Measures remove both the deadline for notifying an investor of the information requiring supplementation or correction and the consequence that the information will be automatically deemed complete if no notice is given within that period. The new Measures therefore no longer impose a fixed time limit on the review of a report through a ‘deemed complete upon expiry’ mechanism; the completion of the reporting obligation depends on the NDRC’s substantive confirmation of the content of the report (which may include supplements or corrections).
(2) Overseas reinvestment reporting applies to round-trip investment
Article 14 of the Measures provides that overseas reinvestment reporting shall apply where an investor makes a round-trip investment in China through an overseas enterprise or other organization under its control. Formally, round-trip investment does not constitute a typical outbound investment as defined in the Measures, i.e. ‘activities whereby an investor, by contributing assets or rights and interests or providing financing or guarantees, directly or indirectly acquires ownership, control, management rights or other related rights and interests in overseas enterprises or assets, among other things. An investor’s reinvestment outside China constitutes outbound investment for purposes of these Measures’. This revision helps the development and reform authorities establish closed-loop information oversight of cross-border capital throughout the process, from outward remittance to return flow, complementing foreign-exchange and foreign-investment administration.
(D) Establishment of outbound investment security reviews
Order No. 11 requires the development and reform authorities, when approving or filing an outbound investment, to examine whether the project threatens or harms China’s national interests and national security, and to withhold approval or filing where it does. An outbound investment project may also attract national security scrutiny if it involves technologies, items, products, data or information subject to export restrictions, or sensitive industries or countries.
Building on the New State Council Regulation, the Measures restate the newly established outbound investment security review system. Under Article 15, outbound investments that affect or may affect the national security are subject to outbound investment security reviews in accordance with the applicable rules. The Measures make clear that after an outbound investment project is completed, the security review also applies at the exit stage, including the transfer or disposal of the assets, rights and interests. However, the Measures generally regulate the conduct of Chinese enterprises making outbound investments, whether directly or indirectly. How to regulate the sale or disposal by Chinese enterprises of overseas rights and interests and assets involving national security, including the specific requirements and procedures, still awaits the issuance of supporting rules and regulatory guidance.
(E) Filing involves more substantive reviews
Article 31 of the Measures introduces a general review requirement for projects subject to filing, although the Measures do not explain what such a review entails. It also extends to projects subject to filing, when the filing authority considers it necessary, the systems under Order No. 11 for commissioning an advisory institution to conduct an assessment, and for soliciting opinions from relevant entities, both of which previously only applied to projects subject to approval. Although Order No. 11 requires filing to be completed within seven working days after acceptance, Article 32 of the Measures allows the filing period for a complex project, or one requiring opinions from relevant entities, to be extended by up to seven working days. The time spent on soliciting opinions from relevant entities is included in the filing period, but the time spent on the commissioned assessment is excluded. Based on a project’s complexity, an investor should anticipate whether an assessment commissioned by the competent development and reform authority may be triggered and allow sufficient time.
(F) More detailed administrative tools (regulatory measures) for the development and reform authorities
Article 17 of the Measures introduces regulatory measures that the development and reform authorities may take in respect to unlawful or non-compliant outbound investment activities. The measures include regulatory interviews, warning letters, orders to rectify, periodic reporting, adjustment of the investment plan and deferral of the investment. They give the development and reform authorities a clearer toolkit for continuing intervention in a project’s substantive risks.
(G) Strengthened post-investment reporting obligations
Under Article 42 of the Measures, project-completion reporting will extend to overseas reinvestment and a new reporting obligation will apply when a project is terminated. The deadline is shortened from 20 working days after project completion under Order No. 11, to 10 working days after completion or termination. The Measures also introduce a definition of the termination of an outbound investment, i.e. an investor ceases to carry out the outbound investment or no longer holds any overseas ownership, control, management rights or other rights and interests arising from it. This includes the sale of equity or assets, or the dissolution and deregistration of an overseas enterprise.
(H) Stronger protection for outbound investment
The Measures improve the material-adverse-circumstances reporting system and establish an annual outbound investment information reporting system.
1. Broader scope of the material-adverse-circumstances report
Against a backdrop of geopolitical developments, a small number of countries and regions have adopted discriminatory measures against investments by Chinese enterprises. These include demanding that Chinese enterprises provide sensitive technology or data, requiring them to dispose of overseas equity or assets, depriving them of their controlling equity stakes and nationalizing their overseas subsidiaries, which seriously harm Chinese interests.
Compared with Order No. 11, Article 53 of the Measures changes the deadline for reporting material adverse circumstances from within five working days from occurrence to immediately. In addition to major casualties among dispatched personnel, major losses of overseas assets and harm to China’s diplomatic relations with relevant countries, it adds circumstances where: (1) a foreign party demands the provision of technology, data or similar items, thereby threatening or harming China’s national interests and national security; or (2) a foreign party demands the transfer or disposal of the assets, rights and interests relating to an outbound investment, thereby threatening or harming China’s national interests and national security.
Chinese investors now have an express reporting system if they are subjected to the above discriminatory treatment in a host country and China’s national interest and national security are threatened or harmed. They should immediately report the circumstances to the development and reform authorities and seek support from the Chinese government.
2. New annual reporting
Article 54 of the Measures introduces a requirement for investors to submit an annual report before June 30 each year. Previously, post-completion annual reporting obligations for outbound investment applied only under the MOFCOM and foreign-exchange administration systems, i.e. an investor must, under the Statistical System for Outbound Direct Investment, report on the Ministry of Commerce’s unified business system platform the basic information of the domestic investor and the overseas enterprise, the information on the reinvestment through the overseas enterprise, and the total amount of the outbound direct investment during the relevant period. The investor must also complete annual registration of the existing rights and interests in the outbound direct investment through the State Administration of Foreign Exchange’s capital-account information system.
For investors, this new rule is both an additional compliance obligation and a channel through which to seek investment protection. Article 54 further provides that an investor may state in its annual outbound investment information report that its outbound investment has been affected by discriminatory measures imposed by a foreign organization or individual or has been subject to unreasonable deprivation or restrictions by such parties. At an investor’s request, the NDRC may take countermeasures, including prohibiting or restricting investment in China by the foreign organization or individual, or prohibiting or restricting domestic organizations and individuals from engaging in transactions or cooperation with those foreign parties.
Article 55 of the Measures provides that if any country, region or international organization violates international law and the basic norms governing international relations by taking discriminatory prohibitions, restrictions or similar measures against China in investment, business operations or other areas, the NDRC may take corresponding measures, in light of the circumstances. This is to protect the safety and legitimate rights and interests of investors and their outbound investments and to protect China’s overseas interests from threats and infringement.
It remains to be clarified by the relevant government departments how these measures will be coordinated with the existing systems concerned with countering foreign sanctions, the Unreliable Entity List, and the rules on blocking the improper extraterritorial application of foreign laws and measures.
(I) Liability extends to professional service providers and the cost of unlawful overseas investment increases significantly
1. Liability extends to professional service providers
Article 48 of the Measures introduces compliance obligations for professional service providers, i.e. they must comply with the laws and regulations, perform their duties diligently, observe professional standards and regulatory rules, and ensure that the documents they prepare or issue contain no concealment, false records, misleading statements or material omission. Article 67 adds legal liability for a professional service provider that: (1) provides services or issues documents while knowing or having reason to believe that an investor is acting unlawfully; or (2) prepares or issues reports, opinions, certificates or other documents containing concealments, false records, misleading statements or material omissions. The development and reform authorities may circulate a notice of the violation and request regulators to take regulatory measures.
This arrangement reflects an extension to the outbound investment field of a regulatory philosophy like that of the ‘gatekeeper liability’ borne by professional service institutions in the capital markets. Although professional service institutions are not the primary decision makers for investment, they are held to a higher standard of responsibility when engaged to provide services or issue documents. Their practice risks will focus on the identification and handling of key matters including project classification, control relationships, the amount of Chinese investment, assessments of sensitivity and the quality of the application materials. These two new provisions impose demanding requirements on professional service providers.
2. Significant increase in the cost of unlawful overseas investment
The Measures also refine and increase investors’ legal liability for non-compliant overseas investment. Articles 59 to 62 provide that an investor undertaking a prohibited project, failing to complete approval or filing, or obtaining approval or filing by improper means may, in addition to the warnings and orders to rectify within a prescribed period already provided under Order No. 11, be required to cease the investment, be ordered to dispose of shares or assets within a prescribed period, have its unlawful gains confiscated, and be subject to a fine calculated as a percentage of the Chinese investment amount, with the responsible individuals also subject to fines. An offender’s outbound investment approval or filing application may also be refused acceptance for three years, or the offender may be prohibited from conducting outbound investment for one to three years. The criminal liability provision serves as a bridging clause for conduct that may constitute a criminal offense; its specific application awaits interpretation of the relevant criminal laws.
II. Conclusion
As the above analysis shows, the Measures give detailed effect to the principles of the New State Council Regulation. Their issuance signals a systematic upgrade of the outbound investment regulatory framework administered by the development and reform authorities. The Measures broaden the scope of investors, extend the regulatory chain and scope, introduce national security reviews, strengthen substantive reviews and improve post-investment administration. They refine and tighten legal liability, respond to new forms of cross-border capital flow and the increasingly complex external environment in recent years, while embodying a regulatory approach of ‘full-process coverage, look-through supervision and coordinated governance’.
For investors, outbound investment compliance obligations administered by the development and reform authorities may deepen, both vertically and horizontally. Vertically, the system may move beyond the ‘strict entry, light exit’ model – focused on ex ante approval, filing or overseas reinvestment reporting for an individual project – and develop into lifecycle compliance obligations for the entire outbound investment. Horizontally, in addition to procedures administered by the development and reform authorities, the Measures demand closer coordination and integration with compliance systems for national security reviews, cross-border data transfers and technology exports. At the same time, the imposition of gatekeeper liability on professional service providers, together with the substantial increase in the cost of violations for investors, will require all parties to reassess their transaction structures, timetables and internal controls. The overall direction towards a more stringent, substantive and granular regulation is clear. Outbound investment compliance will become more complex, demanding and consequential. To effectively manage their legal and business risks, market participants should closely monitor further legislative developments, review and adjust their internal compliance processes at an early stage and allow sufficient time for compliance procedures administered by the development and reform authorities in material transactions.
For further information, please contact:
HE, Fang, Partner, JunHe
1. If the investment involves participation in an equity incentive plan of an overseas listed company, the Notice of the State Administration of Foreign Exchange on Issues Concerning Foreign Exchange Administration for Domestic Individuals Participating in Equity Incentive Plans of Overseas Listed Companies (No. 7 [2012] of the State Administration of Foreign Exchange) applies.
