China

Xinhua | English | News | Jan. 23, 2026 | Regulation

China's Ministry of Finance issued a notice on January 21, 2026, to curb excessively low bidding in government procurement, effective February 1, 2026. The measure aims to reduce involution-style competition and promote a healthy market environment where quality is rewarded with fair pricing.

The notice requires procuring entities to set reasonable price ceilings and configure appropriate procurement packages to support competitive bidding. Financial authorities will oversee bid evaluations, and if evaluation committees fail to properly review abnormally low bids, corrective actions will be taken, including legal accountability for responsible experts.

Procurement entities are also mandated to ensure performance acceptance procedures comply with legal standards, with thorough reviews of all technical and commercial contract requirements during inspections and complaint handling.

事关个人所得税！财政部、税务总局、证监会等三部门发布

STCN | Local Language | News | Jan. 23, 2026 | Regulation

On January 21, 2026, the Ministry of Finance, State Taxation Administration, and China Securities Regulatory Commission jointly announced the continuation of tax policies for the pilot domestic issuance of depositary receipts (CDRs) by innovative enterprises. From January 1, 2026, to December 31, 2027, individual investors will be temporarily exempt from personal income tax on price-differential gains from transferring CDRs of innovative enterprises.

During the same period, a differentiated personal income tax policy will apply to dividend income received by individual investors holding CDRs. Tax withholding and payment responsibilities fall on the domestic depositary institution, which must also file detailed reports with the tax authorities. Foreign tax credits may be granted for dividends already taxed abroad, according to relevant laws and bilateral tax treaties.

For corporate investors, price-differential gains and dividend income related to CDRs of innovative enterprises will follow existing enterprise income tax policies for share transfers and dividends. Public securities investment funds are temporarily exempt from enterprise income tax on these gains and dividends. Qualified foreign institutional investors (QFII) and renminbi qualified foreign institutional investors (RQFII) will treat such gains and dividends as income related to the transfer or holding of the underlying shares of the CDRs for enterprise income tax purposes.

The announcement defines "CDR of innovative enterprises" as securities issued domestically by a depositary based on overseas shares, meeting the pilot enterprise criteria set by the State Council and CSRC guidelines. These CDRs represent rights in the underlying overseas securities.

Yicai Global | English | News | Jan. 23, 2026 | UndeterminedEconomic Growth

The ASEAN+3 region, comprising the 10 ASEAN members along with China, Japan, and South Korea, is projected to experience stronger economic growth in 2026 than previously forecasted. The ASEAN+3 Macroeconomic Research Office (AMRO) updated its outlook, predicting a 4 percent expansion in 2026 following 4.3 percent growth in 2025, marking a 0.2 percentage point upward revision for both years. China’s growth forecast was similarly raised to 4.6 percent in 2026 from the earlier estimate, supported by macroeconomic policies, resilient exports, and investment in high-tech manufacturing.

The region’s economic resilience is attributed to strong technology demand and robust foreign direct investment inflows into sectors such as advanced electronics, electric vehicles, and digital services. Semiconductor exports in the region grew by 21.7 percent in the second half of 2025, driven by demand related to artificial intelligence and cloud infrastructure. The global purchasing managers’ index for electronics new orders showed improvement in December 2025, indicating continued export growth. Regional equity markets have also gained since October 2025, boosted by momentum in artificial intelligence despite concerns about US tariff policies.

Despite more balanced risks overall, AMRO identified ongoing uncertainties and downside risks, particularly linked to unpredictable US trade policies and potential expansions of protectionist measures. A significant slowdown in technology demand, possibly caused by market corrections or delays in AI adoption, could adversely affect regional exports, given the sector's cross-border ties. AMRO emphasized the importance of policy readiness to manage shocks in the short term, while encouraging diversification of growth drivers and deeper regional economic integration to enhance long-term resilience.