Recently, a major policy is reshaping the entire “logic of overseas investment”—State Council Order No. 837 (the “Regulations on the Administration of Outbound Investment”), which will officially take effect on July 1, 2026.

Many people's first reaction is:

“That’s the company’s business; it has nothing to do with me.”

But in reality, the impact of this change is far greater than you might imagine.

01 A Clear Sign: ODI Regulations Have Been Comprehensively Strengthened

In the past, the core of outbound investment management was:

“Can companies invest abroad?”

However, following the new regulations, it has changed to:

“Companies, individuals, capital, technology, and data—can they be transferred abroad safely?”

The regulatory system has been comprehensively upgraded to a multidimensional, coordinated framework:

✅ National Security Review

✅ Export Controls

✅ Data Compliance

✅ Foreign Exchange Control

✅ Antitrust Review

👉 This means:

ODI is no longer a single approval process, but rather a “systematic compliance initiative.”

02 The biggest change: Individuals are now officially included in the regulatory framework

The new regulations specify:Domestic individual residents have been formally recognized as entities eligible for foreign investment.

The coverage includes:

✅ Investing in Foreign Stocks

✅ Mutual Fund Investments

✅ Interbank Market Transactions

✅ Allocation of Financial Assets in the Secondary Market

👉 In the past, many people believed that “individual overseas investment is a matter of personal choice,”

But this logic is changing in the future.

03 Red Chip Structures Face Reevaluation

 For a long time, Document No. 37 has served as the foundational framework for many cross-border structures. However, two changes have emerged following the new regulations:

1. Individual ODI pathways have been incorporated into a unified regulatory framework

2. There may be structural adjustments to regulatory guidelines

👉 The practical impact is:

The red-chip structure may enter a period of redesign in the future, and there is uncertainty regarding whether existing structures are compliant and how to proceed with new ones.

ODI Filing(math.) genus“Red Lines” Have Been Clearly Drawn for the Overseas Expansion of Technology Companies”

04 Article 13 of the new regulations is particularly crucial, as it explicitly lists prohibited activities (including but not limited to):

✅ Cross-border deployment of technical personnel

✅ Overseas Technical Guidance

✅ Cross-border Training

✅ Data and Technology Transfer

👉 The impact on businesses is very direct:

The traditional model of “people taking their skills abroad” will face strict compliance requirements.

Especially:

✅ Cross-border e-commerce companies

✅ Technology Companies

✅ Manufacturing Companies Expanding Overseas

All of them need to reassess their strategies for expanding overseas.

05 Penalty Mechanism: Moving from “Fining Companies” to “Holding Individuals Jointly Liable”

 Another major change in the new regulations is:

(1) Fines are tied to the amount of investment

(2) Liability extends to individuals

(3) Credit Blacklist System

(4) Forced exit from the project

(5) In serious cases, criminal liability may be imposed

👉 The conclusion is very clear:

Compliance costs have risen significantly, and the leeway for non-compliance has been reduced to a minimum.

06 A New Trend: National Security Reviews “Extending Overseas”

In the past, national security reviews primarily covered:

Foreign Investment in China

Now upgraded to:

China’s Capital, Technology, and Assets Must Also Undergo Review When Going Global“

Especially:

✅ Sale of Overseas Assets

✅ Restructuring of Overseas Subsidiaries

✅ Cross-border Technology Transfer

👉 Fundamental Change:

From One-Way Review → Two-Way Security System

07 What should companies and investors do next?

1️⃣ Conducting a New Compliance Review of Overseas Business Structures

✅ Is the red chip structure still applicable?

✅ Is the overseas holding structure compliant?

2️⃣ Redesigning Technology and Data Flow

✅ Does it involve sensitive technology?

✅ Is the data transfer route compliant?

3️⃣ Plan and Register Your Investment Path in Advance

✅ Does ODI trigger an approval process?

✅ Does this involve the regulation of secondary market investments?

concluding remarks

The core of Order No. 837 is not “tightening,” but rather: bringing all previously vague rules on overseas investment back into a system that is regulatable, accountable, and transparent.

For companies and investors, the real challenge is no longer “whether they can go abroad,” but rather “how to do so safely and in compliance with the new rules.”

If you’d like to learn more about the ODI filing process, red chip restructuring solutions, or the details of cross-border investment compliance planning, please scan the QR code below (via WeChat or phone) to contact us at any time. We’ll provide you with one-on-one support for designing and implementing your overseas compliance solutions.