Understanding which industries are restricted for foreign investment is essential before entering the Chinese market. China's Negative List divides industries into three categories: prohibited (no foreign investment), restricted (foreign investment with conditions), and open (full access). This guide provides a detailed breakdown of each restricted category and the latest 2025-2026 changes.
Prohibited Industries: Complete Ban
Foreign investment is completely prohibited in the following sectors:
1. Media & Information
| Sub-Sector | Details |
|---|
| News organizations | All forms of news gathering, editing, and publishing |
| Book/magazine/newspaper publishing | Editing, publishing, and distribution |
| Audio-visual products | Production, publishing, and distribution of audio/video products |
| Radio/TV broadcasting stations | Establishment and operation of broadcast stations |
| Radio/TV transmission networks | Transmission and distribution networks |
| Internet news services | Online news publishing and distribution |
| Internet publishing | Digital publishing of books, periodicals, audio-video |
| Internet audio-visual programs | Online video and audio programming services |
2. Mining & Resources
| Sub-Sector | Details |
|---|
| Rare earth mining | Mining, smelting, and separation of rare earth minerals |
| Radioactive minerals | Mining and processing of uranium and other radioactive minerals |
| Tungsten | Mining and processing of tungsten ore |
3. Healthcare & Biotechnology
| Sub-Sector | Details |
|---|
| Human stem cells | R&D and application of human stem cell technology |
| Gene diagnosis & treatment | Development and application of gene-based diagnosis and treatment |
| Traditional Chinese medicine | Processing of rare and endangered TCM materials |
4. Defense & Security
- Weapons and ammunition manufacturing
- Military and police equipment production
- Defense-related research and development
5. Other Prohibited Sectors
- Gambling establishments and casino operations
- Lottery issuance and operation
- Religious education institutions
- Chinese character domain name registration and management
- Chinese social survey organizations (market research allowed with conditions)
Restricted Industries: Investment with Conditions
These industries allow foreign investment but with specific conditions:
1. Telecommunications
| Sub-Sector | Restriction | FTZ Pilot Opening |
|---|
| Basic telecommunications | JV required, foreign equity ≤ 49% | No change |
| Value-added telecom (general) | Foreign equity ≤ 50% | Some sub-sectors up to 100% in pilot FTZs |
| IDC (internet data center) | Foreign equity ≤ 50% | Up to 100% in Beijing, Shanghai, Hainan, Shenzhen FTZs |
| CDN (content delivery network) | Foreign equity ≤ 50% | Up to 100% in pilot FTZs |
| ISP/ICP | Foreign equity ≤ 50% | Pilot programs for 100% in some FTZs |
2025 Update: The 2025 Action Plan expands the telecom pilot to allow 100% foreign equity in value-added telecom services (IDC, CDN, online data processing) in designated FTZs. This is a significant opening for tech companies.
2. Financial Services
| Sub-Sector | Restriction (National) | Status |
|---|
| Securities companies | Foreign equity limit gradually removed | Mostly open (100% allowed since 2020-2023) |
| Fund management | Foreign equity limit removed | Open (100% allowed) |
| Futures companies | Foreign equity limit removed | Open (100% allowed since 2020) |
| Life insurance | Foreign equity ≤ 50% (being relaxed) | Pilot: 100% allowed in some cases |
| Property insurance | Foreign equity limit removed | Open (100% allowed) |
| Banking | No formal equity cap, but regulatory approval required | Subject to CBIRC approval |
3. Transportation & Logistics
| Sub-Sector | Restriction |
|---|
| Domestic water transport | Foreign equity ≤ 49% |
| Public air transport | Foreign equity ≤ 25%; GM must be Chinese national |
| General aviation | Foreign equity ≤ 51% |
| Ship agency | Foreign equity ≤ 51% |
| Air traffic control | Prohibited |
4. Education
| Sub-Sector | Restriction |
|---|
| Compulsory education (grades 1-9) | Prohibited |
| Higher education | Restricted: JV required, Chinese partner leads |
| Senior high school | Restricted: JV required |
| Vocational/skills training | Restricted but being relaxed in FTZs |
| Pre-school education | Restricted: JV with conditions |
5. Healthcare
| Sub-Sector | Restriction (National) | Pilot Opening |
|---|
| Medical institutions (general) | JV required, foreign equity ≤ 70% | WFOE hospitals in Beijing, Shanghai, Nanjing, Suzhou, Fuzhou, Hainan |
| Medical devices | Manufacturing: open; Distribution: open with registration | Open |
| Pharmaceuticals | Manufacturing: open; Sales: open with license | Open |
6. Agriculture & Food
| Sub-Sector | Restriction |
|---|
| Crop seed breeding | JV required, Chinese partner holds >50% |
| Wholesale of rice, wheat, corn | JV required, Chinese partner holds majority |
| Rare Chinese medicinal materials | Processing prohibited |
| Aquaculture/marine fishing | Some sub-sectors restricted |
7. Culture & Entertainment
| Sub-Sector | Restriction |
|---|
| Cinema construction | Foreign equity ≤ 49% |
| Film production/distribution | Restricted (co-production allowed) |
| Performance venues | Foreign equity ≤ 49%; GM must be Chinese |
| Art auctions | Restricted (JV with conditions) |
| Cultural relic shops | Prohibited |
Fully Open Industries (No Restrictions)
The following major sectors are fully open to foreign investment (not on the Negative List):
- Manufacturing (all sub-sectors) — Fully opened in 2024
- Wholesale and retail trade
- Import/export trade
- Consulting and professional services
- Information technology services
- R&D services
- Logistics and warehousing (general)
- Real estate (general, non-restricted)
- Construction (general)
- Environmental protection
- New energy and clean technology
- E-commerce (general, non-media)
- Advertising
- Hotel and hospitality
- Restaurant and food service
How Restrictions Affect Your Business Structure
| Restriction Type | Required Structure | Implications |
|---|
| No restriction | WFOE (100% foreign) | Full control, simplest structure |
| Equity cap (e.g., ≤49%) | JV with majority Chinese partner | Shared control, need reliable partner |
| JV required (no cap specified) | Joint Venture | Negotiated equity split |
| Chinese GM required | WFOE or JV with Chinese GM | Need to appoint qualified Chinese national as GM |
| Prohibited | No foreign investment | Cannot operate in this sector |
Industry-Specific Licensing Requirements
Even in open industries, certain business activities require special licenses beyond the Business License:
| Activity | Required License | Issuing Authority |
|---|
| Food production/sales | Food Business License | Market Regulation Bureau |
| Import/export | Customs Registration + Import/Export License | Customs |
| Medical device manufacturing | Medical Device Production License | NMPA |
| Pharmaceutical manufacturing | Drug Manufacturing License | NMPA |
| Construction | Construction Enterprise Qualification | Housing & Urban-Rural Development |
| Freight forwarding | International Freight Forwarding License | MOFCOM |
| Payment services | Payment Business License | PBOC |
Conclusion
While certain industries remain restricted or prohibited for foreign investment in China, the trend is clearly toward liberalization. Manufacturing is now fully open, and pilot programs in healthcare, telecommunications, and education are expanding. For restricted industries, carefully evaluate whether a Joint Venture structure is viable, and consider operating in an FTZ where pilot openings may provide access. Always verify the latest Negative List before making investment decisions.
To check if your specific industry is open, use our Market Access Checker. For information on entity structures, see our JV vs WFOE guide.