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  • 2 - China’s Foreign Investment Law in the Past Four Decades

  • Shen Wei, Shanghai Jiao Tong University, China
  • Book:
    Decoding Chinese Bilateral Investment Treaties
    Published online:
    17 August 2021
    Print publication:
    26 August 2021, pp 21-49

  • Summary

    This chapter offers a landscape of China’s foreign investment law – its evolution in the past four decades, the key distinctive features of the foreign direct investment (FDI) regime, the recent developments of foreign investment law (FIL). The chapter lays down a foundation from which to comprehend China’s BIT regime, which initially was put in place to attract FDI and boost economic growth and was later to provide better investor protection to China’s outbound investment. The evolution of Chinese FIL demonstrates the gradual developments of the Chinese legal system and regulatory framework, and, more importantly, the changing role and function of the government in this process. There appears to be a gap between legal systems and governmental functions among China, Western countries and other developing or emerging economies. This gap explains the difficulty in converging the BIT laws. But the evolutionary path is also clear in the sense that both the legal system and the regulatory structure are more liberalized, market-oriented and investor-friendly than they used to be.