On August 27, 2014, the National Health and Family Planning Commission (“NHFPC”) and Ministry of Commerce (“MOFCOM”) jointly released Notice on Conducting Pilot Work of Setting Up Wholly Foreign Owned Hospitals (关于开展设立外资独资医院试点工作的通知) (“Notice”) dated on July 25, 2014. The Notice allows foreign investors to set up hospitals in the form of wholly foreign owned enterprises (“WFOE”) in Beijing, Tianjin, Shanghai, Jiangsu Province, Fujian Province, Guangdong Province and Hainan Province. Under the Notice, either setting up a new hospital or acquiring an existing private hospital is allowed. This move marks a significant step of the opening-up of China’s medical markets to foreign investment. Previously, the equity ratio of foreign investment from outside Hong Kong, Macao and Taiwan in a hospital should not exceed 70%.
Following the big change where registration was replaced by filing for establishment applications of companies excluded in the Negative List, China State Council further approves adjustment of the special access management measures for qualification requirements, share ratio restrictions and business scope restrictions in some industries in the Shanghai Pilot Trade Zone to allow foreign invested enterprises engaging in some business activities that were previously restricted or prohibited.
China has recently passed new laws requiring enterprises to disclose important information which the public can access. On October 1, 2014, new rules came into effect, Provisional Rules on Enterprise Information Disclosure (企业信息公示暂行条例) (“Enterprise Information Disclosure Rules”). One reason behind this new legislation is China’s desire to establish a national credit system founded upon transparency of information relating to registered enterprises. A national credit system will allow the public to access and rely upon important enterprise information when making investment decisions.
The Supreme People’s Court of China recently issued an interpretation on how to calculate the interest accrued on delayed payment – Interpretation of the Supreme People’s Court of Several Issues Concerning the Applicable Law for Calculating Interest On Delayed Payment in the Enforcement Action (FaShi  No.8).
The Interpretation made a clear distinction between General Interest and Penalty Interest, provided guidance on when and how to calculate Penalty Interest, including interest payment in foreign currency.
The State Council has released the Several Opinions on Promoting Fair Competition and Maintaining Regular Order in the Market (the “Opinions”) (in Chinese, “关于促进市场公平竞争维护市场正常秩序的若干意见”) on July 8, 2014.
On June 17, 2014, the Ministry of Commerce (the “MOFCOM”), the major regulator of foreign investment in China, issued the Notice on Improving Foreign Investment Review Administration (商务部关于改进外资审核管理工作的通知) (the “MOFCOM Notice”) to make it clear that registered capital contribution requirements for foreign invested enterprises (“FIEs”) have been relaxed.
On May 19, 2014, the State Administration of Foreign Exchange (“SAFE”) released Notice on the Promulgation of Foreign Exchange Administration Rules on Cross-border Guarantee (国家外汇管理局关于发布《跨境担保外汇管理规定》的通知) (“Circular 29”) with a view to promoting cross-border guarantee activities and convertibility under capital accounts. Circular 29 took effect on June 1, 2014 and twelve other SAFE regulations regarding cross-border guarantee will be abrogated.
China Securities Regulatory Commission (the “CSRC”) issued a notice on May 9, 2014 to seek public comments for the Administrative Measures on the Acquisition of Unlisted Public Companies (Draft for Comment) (hereinafter referred to as the “Acquisition Measures“).
On December 2, 2013, the State Council issued the Circular Concerning Catalogue of Investment Projects Requiring Government Approval (2013 Version) (国务院关于发布政府核准的投资项目目录（2013年本）的通知) (the “2013 Catalogue”) and introduced new changes to governmental approvals falling under the jurisdictions of the two approving authorities, the National Development and Reform Commission (“NDRC”) and the Ministry of Commerce (“MOFCOM”). The objective is to overhaul China’s decades-old, approval-based cross-border investment regulatory system that has restricted growth. The liberating effects from less approval requirements are deemed to bring a new boom in outbound investment to both private investors and Central SOEs (state-owned enterprises managed by the central government), covering a wider range of industries apart from natural resources related industries traditionally favored by Central SOEs.
This past November and December, the US Department of Justice (“DOJ”) and European Commission (“EC”) cleared Microsoft Corporation’s (“Microsoft”) acquisition of the bulk of the devices and services business of Nokia Corporation of Finland (“Nokia”) without any conditions. In contrast, on April 8, 2014, the Chinese Ministry of Commerce (“MOFCOM”) approved the acquisition subject to conditions that include an intellectual property issue that is still to be resolved in the US, EU and other countries: whether holders of standard essential patents (“SEPs”) who make licensing commitments under fair, reasonable and nondiscriminatory (“FRAND”) terms should be barred from seeking injunctive relief against alleged infringers of their patents. MOFCOM’s conditional approval is not controversial for this specific transaction, but raises the question of how MOFCOM’s treatment of this issue will be interpreted in future merger reviews and whether this will affect investigations related to anticompetitive conduct.