There have been successive relaxations of the restrictions over the years, going back more than 30 years.

China's economy used to be completely closed to foreign investment. They didn't open up overnight. It's been a long, gradual process. The JV requirements were meant to prevent foreign firms from instantly wiping out every Chinese company in every sector. But as the Chinese economy becomes more advanced and competitive, the government worries less and less about foreign companies swooping in and taking everything over.