The 14th National People’s Congress opened its fourth session on Thursday with an eight-day agenda that encompasses far more than the headline adoption of the 15th Five-Year Plan. The legislative program includes three major new laws, the Environmental Code, the Ethnic Unity and Progress Promotion Law, and the Law on National Development Planning, alongside the Government Work Report, the NDRC economic plan, and the Ministry of Finance budget. For businesses operating in China, the Environmental Code and the Planning Law carry regulatory implications that will shape compliance requirements and investment conditions through 2030.
The Environmental Code, or Ecology and Environment Code, consolidates and systematizes existing environmental protection laws into a unified framework that establishes a comprehensive legal basis for ecological governance. The code replaces the patchwork of sector-specific environmental regulations that have governed pollution control, emissions standards, waste management, and natural resource protection with a single statutory instrument. For manufacturing companies, the consolidation means that compliance obligations will be defined by a coherent framework rather than by overlapping and sometimes contradictory regulations. The transition period, during which companies must align their compliance systems with the new code’s requirements, will extend through 2026 and into 2027.
The new code’s enforcement provisions are more stringent than the laws it replaces. Penalties for environmental violations have been increased, the scope of administrative enforcement has been expanded, and the grounds for criminal prosecution of environmental crimes have been broadened. Companies that have relied on the fragmented nature of the previous regulatory framework to manage compliance selectively, addressing the most actively enforced regulations while deferring action on less scrutinized obligations, will need to adjust their approach. The unified code eliminates the regulatory arbitrage that fragmentation permitted.
The Planning Law, discussed earlier in these pages, provides the statutory framework for Five-Year Plan implementation and monitoring. Its significance for the current NPC session is that the 15th Five-Year Plan will be the first adopted under the new law’s procedures, meaning that its binding targets, including environmental and energy benchmarks, carry enhanced legal authority. Companies in sectors subject to binding targets, including emissions intensity, energy efficiency, and renewable energy deployment, should treat the plan’s numerical commitments as compliance requirements rather than aspirational guidelines.
The NPC session also includes the adoption of revised work reports from the Supreme People’s Court and the Supreme People’s Procuratorate, which provide annual assessments of judicial and prosecutorial activity. The court’s work report typically includes data on commercial dispute resolution, enforcement of foreign arbitral awards, and the disposition of intellectual property cases, all of which are relevant to foreign businesses assessing the reliability of China’s legal system. The 2025 report is expected to highlight increased enforcement activity under the new Arbitration Law and Foreign Trade Law that took effect on March 1.
For investors, the NPC’s legislative agenda provides a regulatory roadmap that extends beyond the macroeconomic targets of the Five-Year Plan. The Environmental Code will affect compliance costs for manufacturing and industrial companies. The Planning Law will increase the transparency and accountability of plan implementation. The revised judicial work reports will provide updated data on the functioning of the legal system that foreign investors use for dispute resolution. Companies and investors who focus exclusively on the GDP target and the fiscal deficit ratio will miss the regulatory developments that will shape the operating environment for the sectors they are invested in. The NPC session’s value lies as much in its legislative output as in its economic framework.
