Density functional theory (DFT) is used to explore competitive C−H and C−Cl oxidative additions (OA) of chlorobenzene by the neutral Rh(I) complex: (PNP)RhI [PNP = bis(Z-2-(dimethylphosphino)vinyl)amino]. Consistent with experimental results, our calculation shows that C−Cl OA (ΔG‡ = 16.0 kcal·mol−1) is kinetically competitive with C−H OA (ΔG‡ = 16.7 kcal·mol−1) and that the C−Cl OA is thermodynamically preferred by 28.3 kcal·mol−1 over the most stable C−H OA product. Hence, the only experimentally observed product was from C−Cl OA