On June 1, 2026, China’s official news agency published the Provisions on Outbound Investment (original in Chinese, press release in English). The new regulation elevates China’s regime regulating outbound investments to the State Council level. Effective July 1, the regulation provides that outbound investments that “affect or may affect national security” will be subject to dedicated security reviews.The State Council (China’s Cabinet) passed the new regulation on April 17. It was formally promulgated on May 5. Previously, overseas direct investments by Chinese entities were mainly regulated under ministerial-level departmental rules issued by the National Development and Reform Commission, the Ministry of Commerce, and the State Administration of Foreign Exchange.According to official Chinese government statistics, China’s outbound direct investments are on the rise. In the first four months of...