On April 7, 2026, the State Council of China publicized the full text of Provisions of the State Council on the Security of Industrial and Supply Chains (hereinafter referred to as “the Provisions”), which was approved by the State Council earlier in March, and is announced to become effective since the publication date on March 31, 2026. It aims at filling in the blank of the country’s laws and regulation system on the management of industrial and supply chains, and provide legal basis for improving resilience and safety level of both chains of China.

The Provisions include 18 articles, and was drafted in a streamlined and key-point-oriented manner, namely the narrowly tailored method, which was raised and encouraged in China’s legislation work since 2020 by the top leaders. The general ideas for the formulation are summarized by officials of Ministry of Justice of China (MOJ):

-   Balance development and safety: still emphasize high-quality development, while setting up necessary measures for risk prevention.

-   Prioritize urgent matters and elements that may cause safety threat, and connect provisions with other relevant laws and regulatory systems.

-   Stick to issue-oriented rule, form working mechanisms to solve issues that have emerged in practice and regular activities of industrial and supply chains.

Working principles for the safety of industrial and supply chains are put forward in the Provisions as:

-   Implement the overall national security concept of China, coordinate domestic and international considerations, advance high-level opening-up, and promote stability and smoothness in global industrial and supply chains. 

-   Support scientific and technological R&D in key areas, guide rational and orderly industrial and supply layout, advance digitalization and intelligence, enhance safety and controllability, thereby fostering high-quality development of industrial and supply chains. 

-   Adhere to the principles of equality, mutual benefit, and win-win cooperation, strengthen international collaboration, and actively participate in shaping international rules related to industrial and supply chains.

Main contents of the Provisions cover all relevant stakeholders in the industrial and supply chains, and the specific requirements are drafted basically from two perspectives:

-   For government and regulators at all levels: policy making and planning should consider the potential influence on the safety of industrial and supply chains; relevant national regulators will formulate list on critical sectors and keep it updated to ensure smooth circulation and stable operation of raw materials, equipment, products etc.; establish precaution mechanism to monitor safety risks in critical fields; build and optimize safety risk prevention system; improve present emergency response system on critical fields.

-  For market stakeholders (enterprises and sector associations, etc.): optimize risk prevention and control system for safety of both chains; ensure information and data security of key technologies; report to local regulators or governments when any of the major risk or case appears to impact the safety of industrial and supply chain.

Penalties and punishment measures are also stipulated in the Provisions for domestic and international entities/individuals, and relevant details of penalties and measures may refer or base on other relevant Chinese laws, including but not limited to the National Security Law of China, the Law on Foreign Relations of China, the Anti-foreign Sanctions Law of China, and the Foreign Trade Law of China etc.

For foreign stakeholders, the Provisions is of significance that may initiate potential impacts on the industrial and supply chain management in China, mostly to the critical fields that may be identified and included in the national list mentioned in this regulation. So it is very necessary to keep up with the future development of the Provisions, including but not limited to updates on the list of critical fields, publication or public consultation of supportive measures, relevant sector policies that may relate with this topic etc.