Country intelligence • China
China: market-entry intelligence
Country profile · CBAM · Critical materials · COMEXT trade signals · Graph
Three decisions an EU company faces with China. China is a fundamentally different risk profile from the ASEAN countries in this template: the dangers are not corruption or weak institutions but state capacity deployed in data sovereignty, supply-chain security enforcement, exit bans, and geopolitical alignment pressure. Manufacturing is now fully open to 100% foreign ownership (negative list cleared Nov 2024), but the absence of an EU FTA or investment agreement (CAI frozen since 2021), the EU's de-risking instruments (EV tariffs, anti-subsidy investigations), and China's dual-circulation strategy create a structural tension for EU companies that must operate in both markets simultaneously.
How to read this page: ● measured sourced data · ◐ inferred analyst reading, basis linked · ○ projected anchored to a real starting point. Bracketed citations link to the sources at the foot of the page.
1. Trade with China
EU-China FTA
No agreement (CAI frozen)[4]
● measured EU-China trade is the largest bilateral trade relationship with no FTA. EU exporters face MFN tariffs (~7.5%) while competitors with RCEP membership (Japan, South Korea, ASEAN) enjoy preferences. The EU's de-risking strategy and anti-subsidy investigations (EV tariffs, wind turbines, solar panels) add a policy-driven friction layer on top of tariffs.[4,5]
EU exports to China by sector
| SITC section | Latest month (EUR) |
|---|---|
| 7. Machinery and transport equipment | EUR 9.2bn |
| 5. Chemicals | EUR 3.5bn |
| 8. Miscellaneous manufactured articles | EUR 2.4bn |
| 6. Manufactured goods (by material) | EUR 1.2bn |
| 2. Crude materials (excl. fuels) | EUR 1.0bn |
| 0. Food and live animals | EUR 786M |
| 3. Mineral fuels and lubricants | EUR 157M |
| 1. Beverages and tobacco | EUR 147M |
| 4. Animal and vegetable oils/fats | EUR 26M |
| 9. Not classified elsewhere | EUR 10M |
Source: Eurostat COMEXT (ds-059331). [6]
The Nordic lens: Finland's position
Finland's largest export sections: Machinery and transport equipment (EUR 174M), Crude materials (excl. fuels) (EUR 104M), Chemicals (EUR 23M). Same COMEXT series, Finland as reporter.
Certification gate
● measured China uses the China Compulsory Certification (CCC) system for products that affect human health, safety, and the environment. CCC covers ~150 product categories (electrical, automotive, toys, IT equipment). Beyond CCC, sector-specific approvals include NMPA (pharmaceuticals), CFDA (cosmetics), and GB standards (national standards).[7]
- CCC certification mandatory for ~150 product categories before import or sale
- NMPA drug registration: 12-24 months for imported pharmaceuticals
- Cosmetics: NMPA registration required, animal-testing requirements partially eased
- Food imports: GACC (General Administration of Customs) registration for foreign facilities
- Cybersecurity review required for critical information infrastructure operators
◐ inferred CCC is a significant gate for EU exporters of electrical, electronic, and automotive products. The process requires Chinese testing (in-country or partnered labs) and typically takes 2-6 months. Unlike India's BIS, CCC is stable (product list does not expand rapidly).
Free Trade Agreement
● measured The EU-China Comprehensive Agreement on Investment (CAI) was concluded in principle in December 2020 but has been frozen since March 2021 after mutual sanctions over Xinjiang. The European Parliament voted against ratification consideration. Revival is politically distant. No EU-China FTA exists or is under negotiation.[4] Ratification status: N/A. CAI would need renegotiation to be revived.
2. Establish in China
Entity forms
| Type | What it can do | Route / approval | Timeline |
|---|---|---|---|
| Wholly Foreign-Owned Enterprise (WFOE) | Separate Chinese legal entity, 100% foreign-owned. The standard structure for manufacturing, trading, consulting, and services FDI. Requires registered capital (amount varies by industry and location, typically RMB 1-5M for services, higher for manufacturing). | Provincial-level MOFCOM + SAMR; 2-4 weeks for standard (non-negative-list) sectors | 4-8 weeks total setup; manufacturing may take longer (environmental approvals, land-use rights) |
| Sino-Foreign Joint Venture (JV) | Required for negative-list sectors where foreign-majority ownership is restricted. Chinese partner brings market access, licences, and government relationships. Board-level and operational control structures are critical negotiation points. | Same as WFOE + JV agreement filing | 8-16 weeks (JV negotiation is the long pole) |
| Representative Office (RO) | Liaison only. May NOT sign contracts, issue invoices, or generate revenue. Useful for market monitoring and relationship building. Subject to deemed-profit tax (costs x 15% deemed profit x 25% CIT = ~3.75% effective on costs). Maximum 4 representatives. | SAMR; parent company must have operated 2+ years | 2-4 weeks |
FDI sectors: automatic vs government route
| Sector | FDI cap | Route | Note |
|---|---|---|---|
| Manufacturing (all sub-sectors) | 100% | Automatic (WFOE) | All manufacturing restrictions removed from the negative list since Nov 2024. This is the most significant recent liberalisation. Includes automotive, electronics, pharmaceuticals, chemicals. |
| Technology / R&D / software | 100% (most sub-sectors) | Automatic (WFOE) | Software, R&D centres, engineering services are open. Data-related services face Data Security Law / PIPL compliance requirements. VPN and cloud services require JV with Chinese partner (ICP licensing). |
| Financial services | Varies (mostly liberalised) | Conditional (CBIRC/CSRC/PBOC approval) | Securities, fund management, futures: 100% foreign ownership allowed since 2020. Banking: 100% foreign banks allowed. Insurance: 100% since 2020. However, licensing and approvals are extensive. |
| Telecom / cloud / VPN | 50% (basic telecom) / JV required (value-added) | Conditional | Value-added telecom (ICP licence): requires JV with Chinese partner. Cloud services: data localisation required. VPN: government-approved only. This is the main tech-sector friction for EU companies. |
| Media / publishing / education | Prohibited (most sub-sectors) | N/A | Newspapers, book/periodical publishing, radio/TV content production, and cultural auctions remain prohibited to foreign investment. Education: restrictions on K-12 and curriculum. |
| Healthcare / hospitals | 100% (pilot cities since Nov 2024) | Conditional (pilot) | Wholly foreign-owned hospitals permitted on pilot basis in Beijing, Shanghai, Shenzhen, Guangzhou, and other designated cities/provinces since Nov 2024. |
| Automotive / EV | 100% | Automatic | Fully liberalised since 2022 (JV requirement removed). Tesla's Shanghai Gigafactory is the precedent WFOE case. BMW, VW have increased stakes in existing JVs. |
| Agriculture / mining | Varies | Conditional | Most agriculture open. Rare-earth smelting/separation: JV required. Lithium, cobalt processing: specific conditions may apply. |
Corporate tax rates
| Scenario | Basic rate | Effective rate | Note |
|---|---|---|---|
| Standard | 25% | 25% | For all enterprises (domestic and foreign) |
| Small low-profit enterprise | 5%/10% | 5-10% | Tiered: 5% on first RMB 1M, 10% on RMB 1-3M (extended to Dec 2027) |
| HNTE (High and New Technology Enterprise) | 15% | 15% | For qualifying high-tech enterprises; 200% R&D super-deduction |
| SEZ (Hainan / Qianhai / Lingang) | 15% | 15% | For encouraged industries in designated zones |
| Reinvestment incentive (2025-2028) | 25% | ~22.5% | 10% tax credit on profits reinvested in Encouraged Industries |
MAT: No minimum alternative tax.. Foreign company PE rate: 25% on China-source income. No separate branch profit tax; profits remitted after CIT and WHT on dividends..[1,10,11]
Value-Added Tax
13%[1]
Three-rate system: 13% (general goods, manufacturing), 9% (transport, construction, basic necessities, real estate), 6% (services, financial, digital). Small-scale taxpayers: 1% (extended to Dec 2027). Zero-rated: exports.
Withholding tax / TDS (key rates for EU parent)
| Type | Rate | Note |
|---|---|---|
| Dividends to foreign parent | 10% | Reducible to 5% under most DTAs (China has 110+ DTAs). Requires tax-residency certificate + SAFE tax-clearance for remittance. |
| Interest to non-resident | 10% | Reducible under DTAs |
| Royalties to non-resident | 10% | Reducible under DTAs. Technology import contracts may qualify for exemption. |
| Service fees to non-resident | 10% | On China-source income; no WHT if services performed entirely outside China |
Payment and currency
● measured Managed float against a currency basket. Capital account semi-closed: strict controls on cross-border financial flows. Current account convertible. Since 2020, FIEs may freely convert profits into foreign currency for remittance without quota, but require SAFE tax-clearance certificate. Individual FX conversion capped at USD 50K/year.[12,7] Profit repatriation permitted after CIT and dividend WHT settlement. Requires tax-clearance certificate from local tax bureau + SAFE verification. No annual limit on corporate repatriation (unlike Vietnam's once-per-year rule). Processing: 1-4 weeks per transaction.
◐ inferred Payment terms in Chinese B2B trade are typically 30-90 days. LCs are standard for cross-border transactions. The banking system is the world's largest by assets. RMB is increasingly used in cross-border trade settlement (30%+ of China's trade settled in RMB), reducing FX risk for companies willing to invoice in RMB.[7]
Production-Linked Incentives
● measured China uses a multi-layered incentive system: national CIT incentives (HNTE 15%, R&D super-deduction 200%, reinvestment credit), SEZ regimes (Hainan, Qianhai, Lingang, Pudong), provincial/municipal cash grants and land subsidies (vary by location and are negotiated), and the Encouraged Industries Catalogue (determines eligibility for incentives and negative-list exemptions).[8,10,7]
| Sector | Status |
|---|---|
| Semiconductors / integrated circuits | National priority. IC design: 10% CIT (first 5yr) or 12.5% (next 5yr). IC fabrication (≤28nm): 10yr CIT exemption. China Integrated Circuit Industry Investment Fund ('Big Fund') ~USD 47bn across three phases. |
| EV / NEV and batteries | China produces ~60% of global EVs. CATL, BYD dominate. EV purchase subsidies ended Dec 2022 but NEV credit system continues. EU anti-subsidy tariffs (38.1% additional duty on Chinese EVs) reshape the export landscape. |
| Renewable energy / solar / wind | China manufactures ~80% of global solar panels. EU anti-subsidy investigation into Chinese solar/wind equipment. Hainan FTP: 15% CIT for encouraged sectors. |
| Advanced manufacturing / robotics | Made in China 2025 strategy. R&D super-deduction (200% for advanced manufacturing). Provincial grants for smart-factory investments. |
| Pharmaceuticals / biotech | HNTE status widely used. Biotech parks in Shanghai (Zhangjiang), Suzhou, Beijing. NMPA registration remains the gate. |
| Digital economy / AI | Lingang (Shanghai) SEZ: 15% CIT for AI and IC. Data-localisation and cross-border transfer requirements are the compliance constraint. |
Provincial and municipal grants are negotiated case-by-case and are not transparent. The Encouraged Industries Catalogue is updated periodically and determines eligibility. EU anti-subsidy measures on Chinese exports (EVs, solar, wind) are a strategic risk for EU companies with Chinese supply-chain exposure.
Labour framework
● measured China's Labour Contract Law (2008, amended 2012) governs employment. No national minimum wage: set by municipalities/provinces (Shanghai RMB 2,690/month, Shenzhen RMB 2,520/month, inland provinces RMB 1,500-1,800/month as of 2025). Social insurance contributions vary by city (employer ~30-40% of salary for pension, medical, unemployment, work injury, maternity, housing fund). Labour law is national; social insurance rates and minimum wages are set locally. Enforcement is active, particularly on labour-contract registration and social-insurance compliance. Foreign workers need work permits (issued by local human-resources bureaux).[7]
- 996 work culture under regulatory pressure (Supreme People's Court ruled 996 illegal in 2021)
- Social insurance rates vary by city: total employer contribution ~30-40% of salary
- Housing fund contribution: employer 5-12% (mandatory, varies by city)
- Work permit for foreigners: annual renewal, tied to employer and city; exit-ban risk if permit/tax issues unresolved
- Labour dispatch (agency workers) capped at 10% of workforce
The opportunity
China's opportunity for EU companies is the world's largest manufacturing ecosystem and second-largest consumer market. Manufacturing is now fully open to 100% foreign ownership (all restrictions removed Nov 2024). The HNTE programme offers 15% CIT with 200% R&D super-deduction. The risk-adjusted question is whether the operational upside justifies the data-sovereignty, de-risking, and exit-ban constraints that no other country in this template imposes.
Manufacturing fully open to WFOE
● measured All manufacturing restrictions removed from the negative list since November 2024. An EU company can now set up a 100% foreign-owned manufacturing entity in any sub-sector (automotive, electronics, pharmaceuticals, chemicals) without a Chinese partner. Tesla's Shanghai Gigafactory was the precedent; BMW and VW have increased JV stakes.[3]
HNTE + R&D super-deduction
● measured High and New Technology Enterprise status provides 15% CIT (vs 25% standard) plus 200% R&D super-deduction. Extended through December 2027. This combination makes China's effective R&D tax treatment competitive globally. Hainan, Qianhai, and Lingang SEZs offer the same 15% rate for broader activity sets.[10,8]
Scale: world's largest manufacturing ecosystem
● measured China accounts for ~30% of global manufacturing output. The supplier ecosystem, logistics infrastructure, and skilled-labour pool are unmatched at scale. For EU companies with high-volume, complex-assembly products, China remains the reference for total landed cost despite rising wages.[7]
The de-risking arbitrage
◐ inferred EU companies that can maintain China operations while building parallel ASEAN capacity (the China+1 strategy) capture the scale of China and the diversification of ASEAN. This template provides the comparative analysis: India, Thailand, Vietnam, Indonesia, and Malaysia are the alternative-supplier set.[7]
3. Dangers register
7 entries across 5 categories. Each states the mechanism (how it bites an EU company), the evidence (sourced), the mitigation, and what evidence would change the assessment.
Data sovereignty and compliance conflict
China's Data Security Law, PIPL, and Anti-Espionage Law create a regime where routine business data (market research, due diligence, audit materials) can be classified as 'important data' or even 'state secrets'. Cross-border data transfer requires security assessments. An EU company conducting normal business operations may find that data it needs to send to headquarters is blocked, and the act of collecting it may trigger investigation.
● measured Multiple foreign consulting and due-diligence firms raided in 2023-2025. Capvision employees detained. Bain & Company office raided. Mintz Group Beijing office closed, staff detained. The Anti-Espionage Law (revised 2023) broadened the definition of espionage to include data that 'relates to national security', which is undefined.[9,14,7]
Exit bans on foreign executives
Chinese authorities can prevent foreign nationals from leaving China during civil disputes, tax investigations, or criminal inquiries. This has been applied to executives of foreign companies, sometimes as leverage in commercial disputes or investigations. The exit ban can be imposed without advance notice.
● measured The US State Department ICS documents exit-ban cases affecting foreign business executives. Cases have involved tax disputes, commercial contract disagreements, and regulatory investigations. The Supply Chain Security Regulations (2026) add a new potential trigger.[17,7]
EU de-risking and US decoupling pressure
The EU's de-risking strategy and US export controls create a pincer for EU companies with Chinese operations. EU anti-subsidy duties on Chinese EVs (up to 38.1%), investigations into solar panels and wind turbines, and the proposed EU outbound investment screening instrument all signal a tightening policy environment. US CHIPS Act restrictions affect semiconductor equipment and AI chips.
● measured EU EV tariffs (38.1% on BYD, definitive Nov 2024). EU anti-subsidy investigations into Chinese solar, wind, and railway equipment. US Entity List, CHIPS Act export controls. The CAI freeze since 2021 is itself a de-risking signal. EU companies face secondary-sanctions risk if they facilitate restricted US-origin technology transfer to Chinese entities.[15,16,4]
Data sovereignty and compliance conflict
Mechanism: China's Data Security Law, PIPL, and Anti-Espionage Law create a regime where routine business data (market research, due diligence, audit materials) can be classified as 'important data' or even 'state secrets'. Cross-border data transfer requires security assessments. An EU company conducting normal business operations may find that data it needs to send to headquarters is blocked, and the act of collecting it may trigger investigation.
Evidence: Multiple foreign consulting and due-diligence firms raided in 2023-2025. Capvision employees detained. Bain & Company office raided. Mintz Group Beijing office closed, staff detained. The Anti-Espionage Law (revised 2023) broadened the definition of espionage to include data that 'relates to national security', which is undefined.[9,14,7]
Current status: Active and intensifying. The Supply Chain Security Regulations (Apr 2026) add a new layer: procurement decisions can trigger national-security review.
Mitigation: Localise data processing where possible. Conduct Data Security Law assessments before any cross-border transfer. Do NOT store sensitive business data on devices that cross the border. Use Chinese counsel for all due-diligence and audit activities.
What would change the assessment: Clear, published 'important data' definitions by sector. Mutual adequacy agreement with the EU on data protection. A sustained period without raids on foreign information-services firms.
Exit bans on foreign executives
Mechanism: Chinese authorities can prevent foreign nationals from leaving China during civil disputes, tax investigations, or criminal inquiries. This has been applied to executives of foreign companies, sometimes as leverage in commercial disputes or investigations. The exit ban can be imposed without advance notice.
Evidence: The US State Department ICS documents exit-ban cases affecting foreign business executives. Cases have involved tax disputes, commercial contract disagreements, and regulatory investigations. The Supply Chain Security Regulations (2026) add a new potential trigger.[17,7]
Current status: Active. Exit bans are not frequent but are unpredictable and carry extreme personal consequences.
Mitigation: Ensure all tax and regulatory obligations are current before executive travel to China. Use local representatives for contentious meetings. Maintain legal counsel on retainer in China. Brief travelling executives on the risk.
What would change the assessment: Legislative reform limiting exit-ban authority to criminal proceedings. A bilateral consular agreement with the EU providing notification guarantees.
EU de-risking and US decoupling pressure
Mechanism: The EU's de-risking strategy and US export controls create a pincer for EU companies with Chinese operations. EU anti-subsidy duties on Chinese EVs (up to 38.1%), investigations into solar panels and wind turbines, and the proposed EU outbound investment screening instrument all signal a tightening policy environment. US CHIPS Act restrictions affect semiconductor equipment and AI chips.
Evidence: EU EV tariffs (38.1% on BYD, definitive Nov 2024). EU anti-subsidy investigations into Chinese solar, wind, and railway equipment. US Entity List, CHIPS Act export controls. The CAI freeze since 2021 is itself a de-risking signal. EU companies face secondary-sanctions risk if they facilitate restricted US-origin technology transfer to Chinese entities.[15,16,4]
Current status: Active and escalating. The trajectory is toward more restrictions, not fewer. The EU's economic-security strategy (2023) sets the direction.
Mitigation: Map supply-chain exposure to US export-control lists and EU anti-subsidy investigations. Diversify sourcing away from single-source Chinese suppliers in affected sectors (the ASEAN market-entry pages in this template are the alternative-supplier analysis). Monitor EU outbound investment screening proposals.
What would change the assessment: A broader US-China trade settlement. EU-China CAI revival (politically distant). Sector-specific carve-outs in de-risking instruments.
Forced technology transfer and IP risk
Mechanism: Despite formal commitments (Foreign Investment Law 2020, CAI text), technology transfer pressure persists through JV requirements in restricted sectors, procurement conditions, and market-access leverage. Trade-secret theft via cyber-espionage is documented. China's IP courts have improved for patent enforcement but system-wide IP protection remains uneven.
Evidence: China on USTR Priority Watch List continuously. Forced technology transfer identified in US Section 301 investigation (2018). China's IP courts (established 2014) handle patent cases with improving quality, but enforcement against connected domestic companies is inconsistent.[18,7]
Current status: Mixed. The legal framework has improved (Foreign Investment Law 2020 prohibits forced transfer). Practical pressure continues through administrative and procurement channels.
Mitigation: Structure IP ownership carefully: hold core IP outside China where possible. Register all IP (patents, trademarks, trade secrets) proactively in China (first-to-file system). Use contractual protections with Chinese-seat arbitration (CIETAC or BAC/BIAC).
What would change the assessment: Sustained removal from USTR Priority Watch List. A track record of Chinese courts enforcing IP rights against state-connected enterprises in cases brought by foreign plaintiffs.
Dual circulation and localisation pressure
Mechanism: China's dual-circulation strategy prioritises domestic demand and technological self-sufficiency. This translates into import-substitution policies, 'Made in China' procurement preferences, and pressure on foreign suppliers to localise manufacturing and R&D. An EU company selling into China may face progressively tighter requirements to produce locally or be displaced by domestic competitors benefiting from state support.
Evidence: Dual circulation adopted as national strategy (2020). Procurement preferences for domestic technology documented across government and SOE purchasing. Semiconductor self-sufficiency targets (SMIC, CXMT advancing despite export controls). NEV market dominated by domestic OEMs (BYD >30% market share).[19,7]
Current status: Active and structural. The strategy is the organising framework for China's industrial policy through 2035.
Mitigation: Localise where commercially justified (China-for-China manufacturing). Maintain technology differentiation that domestic competitors cannot replicate in the medium term. Focus on sectors where foreign expertise still commands a premium (specialty chemicals, advanced medical devices, precision instruments).
What would change the assessment: Political shift away from self-sufficiency rhetoric (not on the current trajectory). Failure of key domestic-substitution programmes creating renewed demand for foreign technology.
Corruption in a party-state context
Mechanism: Corruption operates differently in China than in the ASEAN countries: the anti-corruption campaign (since 2012) has reduced petty bribery but concentrated discretionary power in party structures. The distinction between legitimate government relations and corrupt conduct is narrower and less transparent. FCPA/UK Bribery Act risk is significant for EU companies interacting with SOEs and government procurement.
Evidence: TI CPI 2025: China scores 43/100 (rank 76/182), comparable to India (39) but with a different pattern (state-capacity corruption rather than petty bribery). The anti-corruption campaign has punished >4.5 million officials since 2012 but is wielded selectively.[13,7]
Current status: The CPI score has been stable at 42-45 for a decade. The anti-corruption campaign is permanent but selective.
Mitigation: Zero-tolerance anti-corruption compliance programme. Treat all SOE interactions as government interactions for FCPA/Bribery Act purposes. Document all gift-giving and hospitality. Use third-party compliance monitoring for agents and distributors.
What would change the assessment: CPI score sustained above 50. Independent anti-corruption enforcement (not on the current trajectory in a party-state).
Capital-account controls and RMB regime
Mechanism: China's capital account remains semi-closed. While corporate profit repatriation is permitted (with tax clearance), the process requires SAFE verification and can be delayed. The RMB is managed by the PBOC and is not fully convertible. Individual FX conversion is capped at USD 50K/year. Large corporate transfers attract scrutiny.
Evidence: SAFE tax-clearance requirement for dividend remittance. Processing time: 1-4 weeks. No once-per-year limit (unlike Vietnam) but administrative friction is real. Capital-account liberalisation is proceeding 'on China's own terms' (selective channels, close monitoring).[12,7]
Current status: Functional for routine repatriation but structurally constrained. The PBOC has not committed to full capital-account opening.
Mitigation: Establish SAFE procedures at company setup. Maintain current tax filings to avoid clearance delays. Use RMB for trade settlement where possible (reduces FX conversion friction). Plan repatriation timing around Chinese fiscal-year-end (Dec 31) audit cycle.
What would change the assessment: Full capital-account convertibility (not on the stated policy path). SAFE procedural streamlining. RMB inclusion in more bilateral settlement frameworks.
19 primary sources spanning EU/Chinese government publications, WTO tariff data, Eurostat trade data, and specialist legal/tax summaries.
- [1] PwC, China Corporate Taxes on Corporate Income (2025/26)
- [2] PwC, China Corporate Withholding Taxes
- [3] NDRC/MOFCOM, Negative List for Foreign Investment Access 2025: reduced from 117 to 106 items; all manufacturing restrictions removed Nov 2024; services, media, finance retain restrictions
- [4] EU-China Comprehensive Agreement on Investment (CAI): concluded in principle Dec 2020, frozen since Mar 2021 (mutual sanctions over Xinjiang); revival politically distant
- [5] WTO, World Tariff Profiles 2025: China
- [6] Eurostat COMEXT (ds-059331): EU27 and Finland trade with China by SITC section, monthly
- [7] US Department of State, 2025 Investment Climate Statement: China
- [8] China Briefing (Dezan Shira), Tax Incentives for Foreign Invested Enterprises
- [9] Data Security Law (2021), Personal Information Protection Law (2021), revised Anti-Espionage Law (2023), Supply Chain Security Regulations (Apr 2026)
- [10] High and New Technology Enterprise (HNTE) status: 15% CIT rate + 200% R&D super-deduction; extended through Dec 2027
- [11] Foreign investor reinvestment incentive (Jan 2025-Dec 2028): 10% tax credit on profits reinvested in Encouraged Industries (advanced manufacturing, green energy, high-tech)
- [12] SAFE (State Administration of Foreign Exchange): profit repatriation permitted after tax clearance; no pre-approval for FIE FX accounts since 2020; individual cap USD 50K/yr; corporate repatriation requires tax-clearance certificate
- [13] Transparency International, CPI 2025: China score 43/100, rank 76/182
- [14] Supply Chain Security Regulations (7 Apr 2026): Chinese authorities can investigate and penalise foreign entities whose conduct is deemed harmful to China's supply-chain security; exit-ban risk for executives
- [15] EU anti-subsidy duties on Chinese EVs (up to 38.1% additional duty, provisional Jul 2024, definitive Nov 2024); investigations into solar panels and wind turbines underway
- [16] US export controls (CHIPS Act, Entity List, EAR restrictions) affecting semiconductor equipment, AI chips, and dual-use technology exports to China; EU following with own instrument
- [17] China exit bans: authorities can prevent foreign nationals from leaving China during civil disputes, tax investigations, or criminal inquiries; applied to business executives of foreign companies
- [18] USTR, 2026 Special 301 Report: China on Priority Watch List for IP (forced technology transfer, trade-secret theft, counterfeiting)
- [19] Dual circulation strategy: China prioritising domestic demand and self-sufficiency in technology, reducing reliance on foreign suppliers in strategic sectors
As of August 2026. Statutory facts verified against primary sources; practice claims cite the basis.