In recent years, more and more Chinese enterprises have established companies or branches in other countries in order to explore overseas markets. When an overseas company or branch is cancelled due to project completion or other reasons, does the domestic enterprise is required to cancel the overseas direct investment (ODI) filing or approval obtained before? There are different treatments on this issue from the commerce authority, foreign exchange administration authority and development and reform authority. The details are as follows:

1. MOFCOM & Its Affiliates
   
   A Chinese domestic enterprise shall apply for and complete the procedures for the cancellation of overseas direct investment (ODI) filing or approval with the competent department of commerce under the following circumstances:
   (1) The certificate of overseas investment by enterprise or certificate of overseas office of enterprise has become invalid. According to the regulations of MOFCOM, the certificate of overseas investment by enterprise or certificate of overseas office of enterprise shall become invalid automatically if a domestic enterprise fails to make any investment overseas within 2 years upon receipt of the certificate.
   (2) The overseas enterprise or office has been deregistered.
   (3) The domestic enterprise has transferred 100% shares or interests of the overseas enterprise to overseas enterprises, organizations or nature persons.
   
   Legal Basis: Article 17 of Measures for the Administration of Overseas Investment (Order No. 3 [2014] of the Ministry of Commerce)
   
   Where an enterprise terminates overseas investment that has already been approved or filed, it shall report the case to the original approving or filing authority, Ministry of Commerce (MOFCOM) or provincial department of commerce, after completing the procedures of deregistration and other formalities in accordance with the law of the investment destination. The original approving or filing authority shall issue a confirmation letter for cancellation according to the report.
   
   Termination means the overseas enterprise that has already been approved or filed is no longer exist or the enterprise is no longer hold any equity or other rights and interests in the overseas enterprise that has already been approved or filed.
   
   
2. SAFE & Its Affiliates
   
   The domestic enterprise that has already completed the foreign exchange registration for overseas direct investments, shall complete the foreign exchange registration procedures for the cancellation of the overseas direct investment with the competent foreign exchange administration authority upon receipt of the confirmation letter for cancellation from the filing or approval department of commerce.
   
   Legal Basis: Article 10 of Regulations on Foreign Exchange Administration of Overseas Direct Investment by Domestic Institutions issued by the State Administration of Foreign Exchange (SAFE) in 2009
   
   In cases where the equity of overseas enterprises held by domestic institutions is cancelled due to causes such as equity transfers, bankruptcy, dissolution, liquidation, expiry of operations, and so forth, the domestic institutions shall, within 60 days after obtaining relevant the documentary evidence issued by the overseas direct investment authorities, complete the foreign exchange registration procedures for the cancellation of the overseas direct investment by presenting the relevant materials to the Foreign Exchange Administrations in their localities.
   
   
3. NDRC & Its Affiliates
   
   According to the Questions and Answers on Approval and Filing of Overseas Investment issued by the Foreign Investment Department of the National Development and Reform Commission (NDRC) in May 2020, if a domestic enterprise plans to reduce investment amount, cancel or exit the overseas investment projects that have fully completed, it is not required to apply for the change. If the overseas investment projects have not completed, the domestic enterprise shall apply for the change with the original approving or filing authority in accordance with Article 34 of the Measures for the Administration of Overseas Investment by Enterprises (Order No. 11 of the National Development and Reform Commission).
   

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