China’s new investment law asserts control over offshore tech transfers in landmark move

China has enacted a sweeping overseas-investment law that aims to safeguard national interests against trade barriers and unauthorised use of advanced technology abroad, though analysts warn that the move could complicate operations for foreign partners.The State Council’s 34-article Regulation on Overseas Investment, taking effect on Wednesday, authorises “necessary and defensive measures” to protect Chinese investors and interests overseas in response to foreign trade-related barriers.Under the mandate, the government will probe trade-related investment barriers imposed by foreign countries and coordinate retaliatory responses. Officials labelled the law a “milestone in the history of China’s outbound-investment development”.Western countries have intensified the use of sanctions, tariffs, anti-subsidy probes and company blacklists to target Chinese industries in recent years.Also known as the 2026 regulation on outbound direct investment (ODI), Beijing’s new law requires Chinese investors to cooperate with authorities during any investigations overseas, according to the Charltons Law Firm website.Chinese investors offshore, in particular, must avoid the unauthorised use of technologies or data that are “subject to prohibitions”, including through personnel reassignments and training events, Charltons said.