Other BriefingsChina’s 2026 Legislative Agenda: Which Laws Matter Most for Foreign Businesses?
The National People’s Congress (NPC) has released the 2026 China Legislative Agenda, outlining a range of proposed and revised laws with significant implications for foreign businesses. Key areas of reform include government procurement, trademark protection, tax administration, bankruptcy procedures, and broader financial regulation, many of which directly affect how foreign companies operate in China. This article highlights the most relevant legislative developments and examines their potential business impact.
On May 12, 2026, the Standing Committee of the NPC released its 2026 Legislative Work Plan, outlining its legislative priorities and the laws it intends to introduce, revise, or deliberate during the year. The agenda includes several long-anticipated pieces of legislation that have undergone years of review and are now approaching finalization, many of which introduce substantial reforms with direct implications for business operations in China.
This article highlights some of the key legislation that foreign businesses should monitor and suggests how they might adapt to the new opportunities and risks arising from these developments.
Government Procurement and Bidding Law reforms
On June 23-26, the NPC Standing Committee will give its first reading to amendments to the Government Procurement Law and the Bidding Law, marking the first time since the two laws took effect that they are being revised together. For more than 20 years, the laws have operated in parallel, with the Ministry of Finance (MOF) overseeing government procurement and the National Development and Reform Commission (NDRC) overseeing tendering and bidding. Overlapping scope and inconsistent standards have long created friction for market participants.
The draft amendments aim to draw a clearer line between the two regimes and unify rules across the full project lifecycle, from approval through to payment, while giving procuring entities more flexibility to choose procurement methods suited to individual projects. It also adds a clarification mechanism for abnormally low bids, requiring bidders to justify pricing that could jeopardize contract performance.
Why it matters
A simultaneous revision should help settle the long-blurry boundary between the two laws, reducing compliance uncertainty for businesses operating in China’s public procurement market. Fairness and transparency in government procurement directly shape how open the market appears to foreign investors, and a unified standards regime gives foreign-invested enterprises clearer rules of participation, removing the uncertainty that comes from policy ambiguity and reinforcing that they hold the same rights and opportunities as domestic firms in procurement activities.
What to watch
With 2026 marking the final year of China’s three-year government procurement rectification campaign, the amendments are likely to be finalized within the year. However, a critical unresolved issue is how “Made in China” will ultimately be defined, as this will determine eligibility for procurement preferences. Although the September 2025 State Council notice introduced a framework for defining “domestic products,” detailed product-level criteria, such as local content thresholds and requirements for key components, are expected to be developed over the next five years, with a three- to five-year transition period.
Foreign investors are advised to pay close attention to the developments in the government procurement area, evaluate their supply chains and product structures against anticipated local content thresholds, and proactively adjust localization strategies, including partnerships, sourcing, and manufacturing footprints, to secure eligibility for procurement preferences.
Also read: New Procurement Rules Favor “Made in China”: Strategic Takeaways for Businesses
Trademark Law revision
The draft revision to China’s Trademark Law had its first reading before the NPC Standing Committee on December 22, 2025, with the text released for public comment from December 27 through February 10, 2026. This is the law’s fifth amendment since 1983, but the first carried out as a full “revision” rather than a piecemeal “amendment,” signaling a structural overhaul of registration and enforcement rather than incremental fixes.
The overall goal of the revision has been to combat bad-faith filings, increase trademark use obligations, and increase the efficiency of procedures around trademark applications. Article 18 of the draft establishes grounds to refuse a trademark application filed without genuine commercial intent, while articles 53 and 56 introduce penalties for malicious filing or misleading use of registered trademarks. The draft also sees the shortening of the window for challenging published trademark applications from three months to two months, with the intended purpose of making the trademark application process more efficient. Movement, sound, color, position, and hologram marks can also be registered for the first time.
Why it matters
This revision matters to foreign businesses, particularly those in consumer goods and retail, as it provides important opportunities as well as commercial risks. While the first-to-file system remains in place, the strengthened use-based requirements create an avenue for genuine trademark owners to challenge squatted trademarks not in use. They also pose potential risks for those holding registrations that they are not currently using. This will reward those who have a strong documented history of commercial use and market presence. The shortened opposition window raises the stakes for companies that monitor filings only sporadically and rewards those who review them regularly. It will also be a practical step to review existing portfolios for brands now eligible for trademark filing under the newly available categories.
What to watch
With a second reading now scheduled for June 23 to 26, the draft could move toward passage faster than earlier expected, though whether the NPC Standing Committee passes it at this session or schedules a further reading will depend on how much the text changes in response to public comments. Once the law is finalized, a practical next step will be reviewing existing trademark portfolios for use documentation and for brand elements, including motion marks, that are now eligible for protection under the expanded categories.
Also read: China Draft Trademark Law Amendment 2026: Key Proposed Changes for Foreign Brands
Enterprise Bankruptcy Law revision
China is undertaking the first major overhaul of its Enterprise Bankruptcy Law since its enactment in 2007. The draft revisions would strengthen China’s cross-border insolvency framework by allowing Chinese courts to exercise jurisdiction over offshore-incorporated companies whose principal assets or operations are located in China. The draft also clarifies procedures for recognizing foreign bankruptcy proceedings, subject to reciprocity and safeguards for domestic creditors. Additional reforms include enhanced support for corporate restructuring, rescue financing, and judicial cooperation in cross-border insolvency cases.
Why it matters
The reforms could provide foreign investors and creditors with greater predictability in restructurings involving China-related assets while expanding the reach of Chinese courts over offshore holding structures commonly used for China investments. The proposed framework also signals China’s intention to align more closely with international insolvency practices and facilitate cross-border restructurings.
What to watch
Key issues center on cross-border coordination and restructuring practice. Investors should monitor final rules on recognizing foreign insolvency proceedings, especially how “reciprocity” will be applied, as well as the treatment of offshore holding structures (for example, Hong Kong, the Cayman Islands, or the British Virgin Islands) with significant China exposure. It will also be important to see whether Chinese creditors retain priority protections in cross-border cases. The practical rollout of new tools, such as debtor-in-possession financing and pre-packaged restructurings, will indicate how flexible and internationally aligned China’s system becomes.
However, this law is not scheduled for the NPC Standing Committee meeting from June 23 to 26.
Financial Law draft
This overarching Financial Law, released for public comment on March 20, 2026, by five financial regulators, will bring sectors previously governed by separate legislation under a single framework, and is confirmed for its first NPC Standing Committee reading at the June 23-26 session. Among others, the law includes penalties for offshore funds or platforms that serve Chinese customers without approval, language broad enough to cover foreign-invested institutions, and foreign branches.
Why it matters
For foreign investors, fintech and cross-border financial services, this draft law signals heavier compliance obligations and a more unified, navigable legislative framework. The extraterritorial provisions warrant attention, since offshore businesses serving Chinese users could fall within China’s regulatory perimeter.
What to watch
As a first reading, provisions may still shift. Mapping China-facing activities against the new supervisory scope is a useful way to prepare ahead of enactment.
Tax Collection and Administration Law revision
This revision will be the first comprehensive revision of the Tax Collection and Administration Law in over two decades. The draft introduces a general anti-avoidance rule covering all taxes, requiring arrangements to have a genuine commercial purpose. It expands data-driven tax supervision, with big-data cross-checking and reporting of seller tax information by online platforms. It removes the requirement to pay disputed tax before applying for administrative reconsideration. It also gives electronic invoices and data full legal validity and introduces rules on deciding taxpayer identification numbers.
Why it matters
For foreign companies in China, the revision points to a more rigorously enforced and modernized tax environment. Preparation could include reviewing whether current arrangements are in line with the incoming requirement that they have a genuine commercial rather than tax-saving purpose.
Key takeaways for foreign business
Foreign companies operating in China should pay attention to the legislative developments outlined by the Standing Committee of the NPC, as they signal an intention to systematize China’s legal landscape and create a legal framework that takes into account the international scope of China’s economy.
The increased emphasis on demonstrable use in trademark law, the push against tax-saving measures without commercial purpose, and the move against financial services incorporated abroad while serving Chinese customers also demonstrate a focus on addressing substance over form in legal reform. To stay informed about future developments, subscribe to our China Briefing newsletters here.
Whether launching, restructuring, or expanding, we ensure our clients benefit from coordinated input across legal, HR, tax, and financial teams. From startup to exit, our advisory scales with your business—designed to meet both immediate needs and long-term goals. About Us China Briefing is one of five regional Asia Briefing publications. It is supported by Dezan Shira & Associates, a pan-Asia, multi-disciplinary professional services firm that assists foreign investors throughout Asia, including through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Haikou, Zhongshan, Shenzhen, and Hong Kong in China. Dezan Shira & Associates also maintains offices or has alliance partners assisting foreign investors in Vietnam, Indonesia, Singapore, India, Malaysia, Mongolia, Dubai (UAE), Japan, South Korea, Nepal, The Philippines, Sri Lanka, Thailand, Italy, Germany, Bangladesh, Australia, United States, and United Kingdom and Ireland. For a complimentary subscription to China Briefing’s content products, please click here. For support with establishing a business in China or for assistance in analyzing and entering markets, please contact the firm at china@dezshira.com or visit our website at www.dezshira.com.
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