Anti-monopoly On M&A By Foreign Investors

From the development perspective and logic of the global capital market, M&A has become the main tendency of global capital flow and distribution. China has moved away a lot of limitation on fields of foreign investment. Therefore, M&A by foreigners in China has taken place in large scale. After China'entering WTO, M&A by foreign investors will become the most important way of foreign investment replacing the traditional direct investment. M&A by foreign investors has positive promotion to the economic development as a whole. However, M&A by foreign investors have two sides, which can also have negative effect on the development of economy of our country, the typical one is monopoly. It will influence the development of national industry, and even control the economic arteries of our country and impact the national economic safety. On August the 30th 2007, China promulgated Anti-monopoly law. The anti-monopoly law will play a significant role in safeguarding market economic order, preventing the monopoly behaviors, reducing the bad effect that monopoly brings. However, the enactment of the Anti-monopoly law does not mean that our country'anti-monopoly system has been perfect. In fact, Chinese legislation on M&A, especially the legislation on foreign M&A, is far from perfect. The only legislation on foreign M&A is section 31, national safety review.This article construes the definition of M&A by foreign investors at the beginning of the paper, then analyzes the reasons of anti-monopoly legislation upon M&A by foreign investors and introduces the substantial rules and procedural rules of anti-monopoly in foreign M&A. According to the newly passed Anti-monopoly law and Provisions on Merger with and Acquisition of Domestic Enterprises by Foreign Investors, the paper mainly analyzes the report mechanism and review mechanism of anti-monopoly law. Taking the anti-monopoly legislation of America and Germany for reference, the paper analyzes the present legislation on M&A by foreign investors and its defects, and advises how to improve the anti-monopoly legislation of China upon M&A by foreign investors.This article altogether divides into six chapter:Chapter 1 is the introduction of M&A by foreign investors. It introduces the concept of M&A by foreign investors and the categories of M&A by foreign investors, and points out the new situation and new features of current M&A by foreign investors.Chapter 2 analyzes the necessity of controlling M&A by foreign investors through anti-monopoly system. The paper points out the negative effect that M&A by foreign investors brings as well as the objective reality of monopoly due to M&A by foreign investors.Chapter 3 points out the substantive elements and the specific rules of controlling M&A by foreign investors through the analysis of the substantive rules of anti-monopoly control on M&A by foreign investors. And a brief description is made on the exemption system of anti-monopoly.Chapter 4 systematically proposes procedural rules of anti-monopoly control on M&A by foreign investors, mainly introduces the report mechanism and review mechanism. The paper points out the insufficiency of the report mechanism and review mechanism and advises on how to perfect the report mechanism and review mechanism.Chapter 5 elaborates the executive system of controlling M&A by foreign investors through anti-monopoly. The establishment of the antimonopoly execution authorities is emphasized and the legal liabilities of violating Anti-monopoly Law by foreigners are summarized.Chapter 6 considers our country'situation as well as adopts the experience of developed countries. Then proposes counter-measures and suggestions on how to complete our country'anti- monopoly system on M&A by foreign investors. The establishment and perfection of anti-monopoly system on M&A by foreign investors not only needs perfect laws and regulations, but also needs the improvements on supervising system, review system and judicial system.