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OECD Investment Policy Reviews China Progress and Reform Challenges: The legal system and FDI


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Laws relating to FDI have become increasingly precise. Moves towards strengthening judicial independence and training more judges are to be welcomed. Improvements could be made in consulting stakeholders, including foreign investors, during the process of drafting legislation. Available legal recourses include conciliation and arbitration both within and outside China. Intellectual property rights (IPR) protection was introduced into Chinese law after economic reform began in 1978. IPR laws, which give equal rights to domestic and foreign‐invested enterprises, protect patents, trademarks and copyrights. Progress has been made in providing such protection, though enforcement remains incomplete. Corruption persists, despite legislation against it, and the Chinese government is working with the OECD on improving enforcement.China has made progress in providing a business environment conducive to foreign direct investment (FDI). The challenge now is to move towards a more rules‐based policy framework that will attract high‐quality FDI from OECD countries. The OECD proposes a number of policy options for the Chinese government to consider in further developing such a framework...
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Document Type: Review Article

Publication date: July 1, 2003

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