The Chinese Foreign Investment Act （“FIA”）， coming into force on January 1 2020, is a unilateral investment protection treaty applying to Investors coming from the rest of the world. It is made on basis of the template Agreement between the People''''''''s Republic of China and [Countries name] on the Promotion and Mutual Protection of Investments （“BIT”， “Bilateral Investment Treaties”）， then plus detailed investment promotion and protection measures and simplified, optimized and crystalized investment supervision. The FIA is promulgated according to the Constitution and has comparatively high level of effect.
The above judgment sentence is the macro foundation for comprehensive and in-depth understanding of the FIA.
The main features of the FIA and its comparison with BIT are described below.
One, Comparison between FIA and BIT:
Definition of “Investment”： substantially the same.
“Investment” under FIA includes direct investment and equity therein + new projects; BIT defines “Investment” more broadly, which means: various assets directly or indirectly invested by one investor in the territory of the other contracting party, including but not limited to : movable property, immovable property and mortgage, pledge or other rights; shares, bonds, stocks or other forms of participation of the company; claims for money or other performance claims with economic value; intellectual property rights, especially copyright, patent and industrial design, trademarks, trade names, processes, trade secrets, know-how and goodwill; commercial franchise granted by law, including exploration, etc.; any change in the form of the investment does not affect its investment nature.
Compared to BIT, the undefined part of the “Investment” is literally covered by the provisions of the “National Treatment” under the FIA.
The FIA''''''''s definition of inv