It seems the five-year rule hasn't been applied universally to date, but it's still lurking in the background? the link below will give you more information re the above:
Information re the so-called '5-year rule',click the link below -
The aforementioned fear and its associated distrust manifest themselves in the government's policies towards foreigners living and working in China. For example, old China hands cannot obtain dual nationality, even those married to Chinese. In addition, it's very difficult for them to obtain Chinese nationality, which is very disappointing in a so-called enlightened and developing country. As for FT's here, there's a new regulation, the five-year rule, that can force them to leave the country if they've been here for 5 years, to spend two years in their homelands before they can return, supposedly to allow them to update their English! One suspects that that rule has been introduced for security reasons - the government does not trust all foreigners who stay in China for a long time, and worries that there might well be some undesirables among them.It's worth noting this distrust of foreigners comes from the top down, and cannot be solely attributed to the uneducated Chinese masses, who wouldn't know any better anyway!