- [Ksenia] China has never been an easy game

for foreign businesses to play.

Companies have complained about a tightly controlled market

and what they regard as protectionist regulations.

There have also been complaints about inadequate protection

of intellectual property, or IP

as well as forced transfers of know-how.

- China, which is a first world country now,

has to play by the rules.

We can't allow them to steal our technology.

- [Ksenia] Though Beijing denies

it forces companies to divulge secrets,

this has been one of the sticking points

during trade negotiations.

But recently--

(Xi speaks Chinese)

With hopes for a partial deal on the horizon,

Beijing has been playing nice,

emphasizing its message that it's working hard

to improve its business environment.

This is something foreign companies operating in China

have been eager to see,

but is this really going to change the game?

Starting next year, China pledges to put overseas companies

on more equal footing with local players

with a new set of regulations.

In January, a new law governing foreign investment kicks in.

It promises to do more

to protect overseas companies' technology and know-how.

- Foreign investment,

well, it does have a positive impact on US companies.

- [Ksenia] Jake Parker is a Senior Vice President

of the US-China Business Council,

a lobby group of some 200 American companies

that do business in China.

In October, the Council received a draft of the guidelines

on how the law will actually work.

In general, they liked what they saw.

Chinese officials will be banned

from forcing technology transfers.

The guidelines will also limit

the disclosure of trade secrets

from going through China's administrative review process.

- However, at least on IP, the draft does fall short

on specifying the types of disclosures

of trade secrets that will be prohibited

and clarifying the types of administrative groups

within China's government

to which provisions of technology transfer apply.

- [Ksenia] At the same time,

China is also rolling out regulations

that will open up its financial sector.

- The banks and all of the financial services companies

will be very, very happy with what we've been able to get.

- [Ksenia] Starting next year,

foreigners should be able to freely invest

in future securities and life insurance.

- The trick is to wait and see

if these implementations and liberalizations

lead to specific licenses for member companies

and there's always a disconnect

between an opening of a sector

and a company being able to operate there.

- [Ksenia] These steps won't only level the playing field

for foreign and domestic companies

but could also end up helping China achieve

its own development goals.

Beijing wants to hit a target of doubling its GDP

between 2010 and 2020.

That will not be an easy task with economic growth cooling

and a trade war stretching deep into a second year.

- Foreign investment remains an important mix

in China's economic system

and they would like to ensure that foreign companies

continue to invest there.

- [Ksenia] While the new investment law is welcome,

analysts say these new business regulations

don't mean a shift away from China's direct investment

in its domestic companies

or looser control of its planned economic goals.

In late October, China set up a state backed fund

for its semi-conductor industry.

The war chest is around $29 billion.

That's about $9 billion bigger than a similar fund

that was raised in 2014.

That's part of an attempt by Beijing

to make its key industries more self sufficient

and competitive in the long run.

(Xi speaks Chinese)

China's new regulations promise a sweeping overhaul

of its older practices,

and this could affect corporate titans

as well as smaller businesses.

- China is going to focus on the economic reform priorities

that make sense for their own domestic economy

and in many ways, those align with some of priorities

of the foreign business community.

- [Ksenia] However, some companies are waiting to see

just how sincere Beijing is about opening up.

At least for now, the opening up is win-win for Beijing.

It extends a political olive branch to the US

during contentious trade talks,

while potentially bringing foreign money

and expertise into its economy.

(upbeat music)