The enforcement of China's Anti-Monopoly Law, beginning August 1, will lead to the amendment of existing regulations for the acquisition of Chinese enterprises by foreign investors, according to Mr. Zhao Xiaoguang, Director-General of the Department of Industry, Communication and Commerce, the Legislative Affair Office of the State Council.
The regulations were issued by the Ministry of Commerce in 2006, one year before the Anti-Monopoly Law was promulgated. Filing standards and rules concerning anti-monopoly reviews are also included in the regulation. The planned revision will be made in compliance with the Anti-Monopoly Law.
Zhao dismissed foreign investors' concerns about the articles in the law concerning the "operators' concentration." He stressed that the law has been designed to challenge any monopolistic conducts which injure market competition and it would govern all market players --- whether they are Chinese or foreign --- in a transparent, predictable and equal way.
All mergers and acquisition deals will be subject to the same filing threshold regardless if they involve Chinese or foreign companies. M&A deals between foreign-funded enterprises are also subject to this law.
According to the proposed standards of filing, the law enforcement authorities will review deals involving a combined global turnover of 9 billion yuan or local turnover of 1.7 billion yuan; or a local turnover of 300 million yuan by a single party. Leeway up to 20 percent may be given.
By People's Daily Online
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