| For the past several years, US has been easily triggering security review mechanism towards the takeover of US companies by enterprises from around the world with china included, and this mechanism has been strengthened by the newly adopted law. Under the influence of US legislation, countries have established the same kind of mechanism as US one through legislation or government decree. International community has paid much attention to this phenomenon wondering whether it is departuring from the system of liberalization of international investment. In china, a number of foreign takeover incidents, represented by Carlyle-Xugong, gave rise to the discussion by people of all level on how foreign M&A will affect national security of china. The voice on strengthing security review towards foreign takeover could be heard all the time. The 2010 Government Report mentioned to encourage foreign M&A, but also to step up the speed to erect the legal system of security review toward foreign M&A.Firstly, this dissertation will focus on the US legal system of security review on foreign M&A, then it will make analysis on the same kind of legislation of counties such as Germany and Russia. After that, it will make a study on how to coordinate internatonally the legislation of security review on foreign M&A all round the world. Finally, the dissertation will give some advices to chinese legislation of security review on foreign M&A. The whole dissertaion divides into seven parts, consisting of 200,000 words.In the First Chapter, the author will analyze the background and process of the legislation of the original text of security review US foreign M&A---"Exon-Florio Amendement".In different historic period, the US has been seeking balance between openning investment poilcy and restrictive measures for safeguarding national security. For the history reasons, the US carried out openning policy in the early time, and even the baisic industrial system was built with the help of foreign capital. In the World War I, US enacted many industrial regulation laws, impeled by US Navy. In the World War II, US often regulated foreign investment through Anti-Monoply Law, because at that time foreign investors came into US using international Cartel.During the 30 years after World War II, few laws were enacted in US because of its long term status of capital exporting country. When the time came into 1980, large scale foreign takeover of US enterprises aroused much concern even panic from people of all levels. The debate was focused on whether foreign investment would have impact on US security. Triggered by the takeover of American Fairchild by Japansese Fujitsu, US congress passed the"Exon-Florio Amend".Analysing through the perspective of US Congress political system, we find that on the one hand"Exon-Florio Amend"was a compromising outcome between President and Congress, but in the essence it was a new legal mechanism to defend the benefit of American industries.In the second chapter, the author will make a thorough study on the legal framework, early implementation and amendment of"Exon-Florio Amend". US had established a legal system of security review on foreign M&A through"Exon-Florio Amendment"and its implementation regulation. US legal system of security review on foreign M&A showed that US was not only securitizing many practical problems it was facing, but also it was legalizing security issues. This chapter study the review structural establishment, rules of procedure and substantial criterion under this system, and also set forth the relationship between this legal system and other related system.Looking at the early implementation of Exon-Florion Amendment, a trend of protectionism for some degree was emerging. For example, not long after the enactment of Exon-Florion Amendment, then US President Bush in 1990 ordered CATIC, the import-export arm of the Ministry of Aerospace Industry of the People's Republic of China, to divest its interest in MAMCO, a privately owned, Seattle-based manufacturer of civilian airplane parts, primarily for Boeing. In 1992, French firm Thomson-CSF made a bid for the missile and aerospace division of LTV, a bankrupt American conglomerate. The background of the both foreign companies triggered the concerns of Congressmen. In 1993, congress modified the Exon-Florion Amendment by passing Berd Amendment, which established compulsory notice system for foreign government related M&A, added new national security considerations, and strengthened CFIUS report to Congress, etc.In the third chapter, the author will anylize"2007 Foreign Investmen and National Security Act"---FINSA.After the terrorist attacks of September 11 in 2001, US perspective to national security added more non-traditional factors. US legal system of security review on foreign M&A was facing new challenges under this background. A number of significant foreign M&A in US, taking Lenovo-IBM, CNOOC-Unocal, Dubai Port World Wide, for example,provided an opportunity for congressman and the public who were not satisfied with the situation of US economy and security. Propelled by the Xenophobia emotion and related interest group, US legal system of security review on foreign M&A was modified significantly in 2007. Although US legal system of security review on foreign M&A has some kind of trend toward protectionism, it has also been trying to keep balance between openning investment policy and safeguarding national security. This chapter will make a analyisis on whether amendment bills from 2005 and FINSA help to keep this balance. We believe that for the one thing, the balancing mechanism has not been broken, but for the other, whether it will be broken shall depend on the attitude of the US Government towards the vagueconcepts such as national security.The enactment of FINSA showed not only the strengthening of Congress invervening force, but also the trend to step forward in legalization of security issues. US Government has promulgated a Guidance Concerning the National Security Review, which is the first one of this kind in the world. We believe that FINSA would show a demonstration role for the rest of the world, influencing significantly the future of legislation in international investment. In practice, FINSA would be a two-blade knife, if not dealt well, it will hurt foreign investors, but also probably has a significant impact on US invesment environment, even national security.In the fourth chapter, the author will study the implementaion of US legal system of security review on foreign M&A taking telecommunication as an example.CFIUS has received more than 1500 review applications. Due to the confidentiality of the national review process, CFIUS or other related security bodies never made the related information public. But as for the foreign M&A in the telecommunication field, the net security agreement, which is a condition for the FCC to indorse the M&A, could be easily obtained from the FCC website.In the field of telecommunication, following the deregulation, there have emerged large scale of cross-border M&A. In this chapter, the author will make a thorough analysis on the network seurity agreement used by FCC to indorse foreign M&A, pointing out that measures taken by CFIUS and related security bodies are discriminatory to a large extent, which is also not in compliance with US internal legal system and WTO telecom related Agreement. After a camparative analysis, we argue that these security safeguarding measures in other related areas may provide a useful reference to eliminate the discrimination carried out by FCC and CFIUS. This comparative analysis would also provide a significant reference for our government to strengthen security review in the field which is under deregulation.In the fifth chapter, the author will make a comparative study on the legal system of security review on foreign M&A in Germany and Russia.As a matter of fact, influenced by US legislation, many countries have established all kinds of legal system of security review on foreign M&A, besides the legislation in Germany and Russia. The first reason that only the legislation in Germany and Russia will be selected to make a comparative study is due to the length of the dissertation, another one is that the legislation in those two countries could be taken as representatives in related legislation.German legal system of security review on foreign M&A was established through twice modification to its Foreign Trade and Payments Act and Foreign Trade and Payments Regulation. Under German legal system of security review on foreign M&A, it implement compulsory notice system in few industries, but for the rest of the industries, it do not require a prior approval for foreign M&A related transactors, which. This system is lenient than Russian one, and even more free than US voluntary notice system. Therefore, we find that German securiy review system on foreign M&A has taken measures to reduce the cost added to foreign investors to the greatest extent. In the Russian legal system of security review on foreign M&A, legislators wanted to enchance the transparency through a long list of industries which are accessable to foreign investors. But due to the very broadness of the list, the legislation finally become a approval system, which just followed the characteristics of Russian legal system.As for the substantial criterion, German legislation use the concept of public policy and public security, and it also showed that it will comply with the EU Treaty and the related interpretation from judicial precedent of European Court. Therefore, the review criterion in German legal system of security review on foreign M&A is much narrow. Russian legislation didn't difine the concept of security, the way for the government to make sure whether there are security risk involved is to find out whether the strategic companies cover the listed 12 kind of businesses. Compared with the criterion in the US legislation, the German one is much narrower, but the Russian one is much broader.It is noticeable that in the legislation and implementation, both Germany and Russia took risk mitigation measures, in stead of blocking foreign M&A bluntly. This kind of measure just follows mitigation agreement in US practice, and it is also in concordance with proportionality proposed by OECD and affirmed by case of European Court.In the sixth chapter, the author will make a study on the internatinal coordination of legal system of security review on foreign M&A.After a positive analysis on existing legal instruments of OECD conerning investment and all kinds of bilateral, regional, multilateral agreements, we find that host countries often reserve the right to review foreign investment with in the form of exception. But different agreenment often show specific characteristics. Although host countries could review foreign investment with in the form of exception, but they could not do it without any constraint of international law completely. The author make a study on the condition of how to apply security exception, based on the analysis of related provisions in the customary international law and America-Argentina BIT, combined with the ICSID arbitration practise.OECD holds that foreign M&A is not different from other forms of international investment in the view of impact on host countries. OECD"Guidelines For Recipient Country Investment Policies Relating To National Security"encourages contries to comply with the principle of non-discrimination, transparency and predictablity, proportionality, and accountability, when carrying out security review on foreign M&A. With the analysis of those principles, the author hope to provide a theoretical framework for the internatinal coordination of legal system of security review on foreign M&A. Furthermore, European Court has already enter judgements to member countries as to their blocking foreign M&A, the analysis of those judgements will also provide a reference to the internatinal coordination of legal system of security review on foreign M&AIn the seventh chapter, the author will take a study on legal issues concerning security review of foreign M&A in china.There are different kinds of viewpoints to the impact of foeign M&A on the security of china, the author sum up perspectives of related economists and juristic scholars conercing economic security and industrial security, etc. In the meantime, the author sum up the provions in related policies and legal instruments concerning foreign investmen management. The author also analyze and check the problems in security review of foreign M&A.The newly adopted Anti-Monoply Law of China added a provion concerning national security review of foreign M&A, but this did not end the discussions, even disputes among scholars concerning the relationship of the security review, anti-monoply review and industrial policies review to foreign M&A. Based on the analysis on the value of legislaion concerning security review on foreign M&A, the author hope to provide a theoretical basis to legislation of security review on foreign M&A in china. Through the analysis of legislation of security review on foreign M&A in afore counrties, the author attempt to give some advices on probable issues in the legislation of security review on foreign M&A in china.
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