Doing Business in China For Dummies®

Classifying Your Company and Reckoning with Restrictions

Although China is robust with business opportunities, you have to maneuver through more than a few restrictions. China has reasons for such limits:

✓	China is still transitioning from a command-type economy, and it still likes to have a lot of control. This idea is particularly true as China tries to balance economic development with social stability.
✓	China is trying to gradually expose its companies to foreign competition. The government hopes bringing in foreign competition more slowly will allow Chinese companies to strengthen and be able to compete.
✓	China considers certain industries to be essential for national security, so it restricts foreign investment.

At the same time, China is actively looking for foreign investors in a number of industries, especially export-oriented ones. China also encourages foreign investment in certain industries because it wants to discover how to do those businesses or use a particular technology.

This section discusses industry regulations that have to do with your scope of business. To find out how the Chinese feel about foreign investment in your industry, consult the foreign investment catalog discussed in the next section.

Checking out the catalog

Any serious consideration of doing business in China should begin with the Catalogue for the Guidance of Foreign Investment Industries (the foreign investment catalog). Type the name of the catalog in your search engine or visit www.fdi.gov.cn/pub/FDI_EN/Laws/law_en_info.jsp?docid=51089 ...