Chinese workers clean equipment at the construction site of the Tel Aviv city railway in Israel, which is being built by China Railway Construction Corporation Ltd.
China has finalized rules including punishments for illegal activities, and the definition of sensitive countries and sectors on outbound direct investment, the country's top economic regulator announced on Tuesday.
The new rules, published on the website of the National Development and Reform Commission, will become effective on March 1, 2018. They remove a provision requiring companies planning outbound investment of more than 0 million to submit a "project information report" to the NDRC.
For non-sensitive overseas acquisitions or bids worth more than 0 million, the investors only need to notify the NDRC in advance, and submission of the report will no longer be necessary. They only need to report to the provincial-level development and reform authorities.
The NDRC, together with local governments, will enhance supervision of these investments through a nationwide online platform, interviews and random inspections. It will also establish credit records on illegal overseas investment activities.
"Some overseas investments have been conducted outside the current regulatory framework, bringing certain risks to China's economy," said Li Guanghui, vice-president of the Chinese Academy of International Trade and Economic Cooperation in Beijing.
Under the rule, Chinese companies from both the private and State-owned sectors are prohibited from investing in countries or regions that have no diplomatic ties with China, and places with wars or civil strife.
Companies engaged in outbound investment should not violate national interests and security, as well as macro and industrial policies, according to the NDRC document.
Following the introduction of measures to avoid risks and tackle irrational and illegal investment activities in gambling, entertainment and sports, China's ODI volume dropped 33.5 percent year-on-year to 7.55 billion between January and November this year, official data show.