The State Council’s Regulations on Outbound Investment (Decree No. 837) officially came into force on July 1, 2026. As China’s first administrative regulation governing outbound investment, it marks a shift in ODI supervision from fragmented ministerial rules to a new unified law-based regulatory framework.

The new regulation introduces three core changes that directly reshape enterprises’ compliance pathways for global expansion:First, the scope of covered investors has been expanded. For the first time, "resident individuals" are explicitly classified as investors. Personal overseas investments previously conducted via SPVs, nominee holdings and other structures will be subject to brand-new compliance obligations.Second, an independent security review system has been established. Outbound investments that affect or may affect national security will trigger statutory security reviews, extending regulatory oversight from project approval to the full lifecycle including asset holding, transfer and divestment.Third, penalties for violations have been significantly tightened. Entities failing to complete approval or filing procedures will be fined 0.1% to 0.5% of the investment amount and have illegal gains confiscated. Those endangering national security will be barred from conducting outbound investment activities for one to three years.

In addition, enterprises must strictly observe export control prohibitions. The regulation explicitly bans the cross-border transfer of state-prohibited or restricted technologies and data through personnel assignment, technical guidance, cross-border training and other means. Businesses operating in high-tech, semiconductor, biomedicine and other sectors face elevated compliance standards.