Legal Analysis On The "Negative List" Approach For Foreign Investment Access

The negative list approach is a kind of management mode for foreign investment access which based on the values of "All is permissible unless prohibited". It consists of two core concepts:pre-establishment national treatment and negative list. The country who adopts negative list approach will make a list of industries that foreign investment are banned or restricted from entering. Besides the negative list, all areas are open to foreign investors and in where they will be treated as same as the investors from host country. Compared with positive list approach, negative list approach has a higher level of openness and transparency which embodies the trend of international investment liberalization. And just because of this, developed countries would prefer negative list approach when it comes to the issue of foreign investment access. The America is playing a vital role in the process of promoting negative list approach and has gradually formed a system of American Negative List by regional/international bilateral and multilateral agreements.The Sino-U.S. BIT provides a perfect opportunity for China to keep up with the high standards of international investment rules. In July 2013, China agreed to start substantial negotiations with the United States on the basis of pre-establishment national treatment with a negative list approach. Therefore, on the one hand,we need to make in-depth researches on the trade/investment treaties that adopted negative list approach, especially those treaties have America as a party. On the other hand we should accelerate the exploration of negative list approach in domestic so that we can get some practical supports on negative list negotiations. U.S.-Korea trade agreement, NAFTA and MAI are typical cases that adopt negative list approach. Through the analysis of them, we can find that in order to make achievements on the treaties, the developed countries had no problems with more reservations from developing countries. To pave the way for the coming negotiations on negative list, the exploration of negative list approach has started in Shanghai FTZ with the promulgation of the Negative List 2013 and the Negative List 2014. Although the current version of negative list still has lots of deficiencies, such as the market is not open enough since the list covered too much industries, the feedback information from its implementation will be of great precious to the Sino-U.S negotiations on negative list.This paper uses historical analysis method, comparative research method and literature research method. Start with the study on basic theory of the negative list, the paper makes analysis on some representative trade/investment agreements and the negative lists of Shanghai FTZ. And then there is a summary of the experiences and inspirations that the former agreements or negative lists bring to us. Based on the studies above, the paper makes a predictive analysis of the specific problems that China may encounter in the future negotiations and tries to offer corresponding counter measures.