Regional Round-Up: China Q4 2025 (Year in Review Edition)

Throughout 2025, China’s legal and regulatory agenda continued to shift toward consolidation, enforcement and institutionalisation. While many headline reforms had been introduced in previous years, 2025 was characterised by the deepening implementation of those frameworks through departmental rules, enforcement actions and draft legislation aimed at translating policy objectives into durable and operational legal structures.

Corporate Governance and Market Access: Implementation Takes Centre Stage

Corporate regulation in 2025 unfolded against the backdrop of the new People’s Republic of China Company Law, which was adopted on 29 December 2023 and came into effect on 1 July 2024. By 2025, regulatory focus had shifted decisively from legislative reform to practical implementation and enforcement, particularly in relation to capital contribution timelines, shareholder obligations, and the duties of directors and senior management. This trend was further reinforced by the issuance of the Implementation Measures for the Administration of Company Registration (公司登记管理实施办法, effective 10 February 2025), which provided greater clarity on registration procedures, capital verification requirements and the supervisory powers of registration authorities.

Taken together, these developments signal a move toward tighter front‑end and ongoing scrutiny of corporate compliance. The combination of a more rigorous substantive legal framework under the PRC Company Law and more detailed procedural requirements at the registration and filing level reflects regulators’ intent to close gaps between statutory obligations and day‑to‑day corporate practice, raising expectations for governance discipline, capital adequacy and compliance documentation across the full corporate lifecycle.

Market access reform advanced in parallel. On 16 April 2025, following approval by the Communist Party of China (CPC) Central Committee and the State Council, the National Development and Reform Commission, together with the Ministry of Commerce and the State Administration for Market Regulation (“SAMR“), released the new edition of the Negative List for Market Access (2025 Edition) (市场准入负面清单(2025年版)). The new list reduced restricted items from 117 to 106 and formally replaced the 2022 edition with effect from the date of issuance. While the revisions shortened the list overall, they also clarified entry conditions for emerging and sensitive sectors, reinforcing a trend toward clearer – yet more finely calibrated – regulatory gatekeeping for both domestic and foreign investors.

Data Protection and Cybersecurity: Enforcement and Reporting Obligations Intensify

Data compliance remained one of the most actively enforced areas in 2025. Against the ongoing backdrop of the Personal Information Protection Law (“PIPL“), regulators continued to expand inspections and compliance audits, particularly targeting sectors that handle large volumes of sensitive personal information, such as finance, healthcare and digital platforms. These enforcement activities reflected a broader regulatory shift from framework‑building toward evidence‑based, operational compliance.

Complementing this trend, on 17 June 2025, SAMR and the National Standardisation Administration jointly released the Data Security Technology — Security Requirements for Processing of Sensitive Personal Information (数据安全技术 敏感个人信息处理安全要求, “Requirements“). The Requirements, which took effect on 1 November 2025, provide more granular technical and organisational guidance for processing sensitive personal information. Closely aligned with the PIPL’s core principles, they translate high‑level legal obligations into concrete operational standards, signalling that regulators will increasingly assess compliance by reference to substantive technical implementation rather than formal policy adoption alone.

A further milestone was reached on 11 September 2025, when the Cyberspace Administration of China issued the Administrative Measures for the Reporting of National Cybersecurity Incidents (国家网络安全事件报告管理办法, “Reporting Measures“). The Reporting Measures came into effect on 1 November 2025 and established a unified, mandatory reporting regime for cybersecurity incidents, with detailed classifications, reporting timelines and content requirements. Although grounded in existing obligations under the Cybersecurity Law, the Data Security Law and the PIPL, the Measures substantially raised compliance expectations by standardising reporting procedures across industries and jurisdictions.

Competition Law: Sustained Scrutiny of Digital and Platform-based Business Models

Competition enforcement remained robust in 2025, with regulators maintaining a strong focus on the digital economy. Throughout the year, SAMR continued to apply the Anti‑Monopoly Law to platform operators, particularly in relation to abuse of dominance, exclusive dealing arrangements and failures to notify merger transactions. By 2025, enforcement activity had clearly shifted from campaign‑style interventions to a more institutionalised and technically detailed review of platform conduct.

Legislative developments further reinforced this trajectory. On 27 June 2025, the Standing Committee of the National People’s Congress adopted the revised Anti‑Unfair Competition Law (2025) (反不正当竞争法(2025修订)), which was scheduled to take effect on 15 October 2025. The revisions introduce new tools to address platform-driven competition concerns, including measures aimed at curbing below‑cost pricing and the abuse of advantageous market positions. Collectively, these developments suggest that heightened competition scrutiny of technology-heavy and data-driven business models is likely to remain a structural feature of China’s regulatory environment.

Financial Regulation: Facilitating Cross-Border Investment under Enhanced Oversight

Financial regulation in 2025 continued to balance risk control with efforts to support cross‑border investment and financing. A key development occurred on 15 September 2025, when the State Administration of Foreign Exchange (“SAFE“) issued the Notice on Deepening the Reform of Foreign Exchange Administration for Cross‑Border Investment and Financing (Circular [2025] No. 43) (关于深化跨境投融资外汇管理改革有关事宜的通知, “Notice“). The Notice introduced a series of reform measures covering foreign direct investment, cross‑border financing and the use of capital account receipts, with the stated aim of streamlining foreign exchange administration and facilitating cross‑border capital activities.

From a practical perspective, SAFE’s initiatives reflect a continued shift toward facilitation‑based regulation, coupled with strengthened post‑event supervision and data‑driven monitoring. For enterprises engaged in cross-border investment, financing, and fund repatriation, the reforms offer greater operational flexibility, but also underscore the importance of robust internal controls, accurate reporting, and alignment with evolving regulatory expectations.

Summary

Taken together, the developments of 2025 reflect a regulatory environment that is becoming less experimental and more institutionalised. Legislative reform is increasingly accompanied by detailed implementing rules, standardised procedures and sustained enforcement. For businesses operating in China, this translates into higher expectations around demonstrable compliance, earlier and more proactive regulatory engagement, and closer alignment between internal governance structures and evolving legal requirements.