Legal Issues On Mergers And Acquisitions Of Domestic Enterprises By Foreign Investors

Under the fast development of world economy compacting,,all of characteristic of region economy and globalization economy are taking concentrated expression. More transnational merger cases are carried out in a lot of big merger cases at the end of twenty century. The transnational mergers are becoming the main trend of world merger economy now. After the China has became the member of WTO, he law of corporation has been issued and actualized and the stock rights system has been reformed, the right of foreign capital owner that to carry out merger with Chinese quoted company has been improved and the merger which is carried out by foreign capital owner shall face to a new situation. The law and statute of merger which is carried out by foreign capital owner in Chinese are not perfect. The arrangement of legalization are too much and more standard with actual operation purpose are all administrative statute and less force of law in current Chinese law system. The purchase theory and relative operation practice of Chinese and others country are arranged according to the relative problems of merger which is carried out by foreign capital owner and put out some suggestion on our country's legislation of mergers and acquisitions by foreign investors in this thesis.Mergers and acquisitions by foreign investors are"double-edge swords", and have some side effects on domestic market, so we should act to use its positive effects and avoid side effects. In this paper, I focus on the anti-monopoly of China's legal system involved in foreign capital M&A activity and the renewal of legal system of China's foreign investors. This paper also introduces some experience and practice of mergers and acquisitions in developed countries and by analysis and comparison proposes the system of mergers and acquisitions by foreign investors in order to make our China's legal system on mergers and acquisitions by foreign investors more scientific, more perfect and more practicable. Abide by this thought, my paper's frame are as follows:The chapter I introduces outlines of Mergers and Acquisitions of domestic enterprises by foreign investors. Before the issues Mergers and Acquisitions of domestic enterprises by foreign investors, we need to clear the concept of Mergers and Acquisitions of domestic enterprises by foreign investors. Only a clear concept, we can clear the scope of the study and better understanding of Mergers and Acquisitions of domestic enterprises by foreign investors on legislative issue. In the M&A of domestic enterprises by foreign investors, it will produce a legal relationship. M&A by foreign investors legal relationship means the rights and obligations produced by legislations regulations and policies on M&A and it is one of the main problems of Mergers and Acquisitions of domestic enterprises by foreign investors. M&A by foreign investors legal relationship with other legal relations composed of subject, object and the relationship between rights and obligations. Therefore, the study of Mergers and Acquisitions of domestic enterprises by foreign investors is to study the subject, object and the relationship between rights and obligations of Mergers and Acquisitions of domestic enterprises by foreign investors. After the all of above, we need to overview the legislations on M&A.Attracting foreign investment later than other counties, the development of legislation on mergers and acquisitions is faster. Before September 1995, the legislation is blank. Until the phenomenon of zhongce, the legislation on M&A has entered a stage of restrictions on M&A by foreign investors. This stage suspended on the transfer of state-owned shares and corporate shares of listed company. 1998 State Economic and Trade Commission issued a "use of foreign investment in an asset reorganization of the temporary regulations," indicating beginning of the Legislation on M&A, the Legislation on M&A began emergence. In 2003 the "Provisional Regulations" signifies the legislation on M&A entered a continuously improving stage. The chapter II is the mode of Mergers and Acquisitions of domestic enterprises by foreign investors. The mode of Mergers and Acquisitions of domestic enterprises by foreign investors is different between various foreign investors. Therefore the study of Mergers and Acquisitions of domestic enterprises by foreign investors must study the mode of it.In accordance with different subject transactions, Mergers and Acquisitions of domestic enterprises by foreign investors can be divided into shares M&A and assets M&A. According to the "management of a listed company"and the new version of the "Securities Act" and shares takeover offer to purchase, purchase agreement as well as other lawful manner. The tender offer, based on the number of shares of the acquired company can be part of a comprehensive tender offer and tender offer; according to whether mandatory can be divided into compulsory tender offer and voluntary tender offer. Asset M&A may be taken assumed debt or purchase method.According to the target enterprise is a listed company or not, the acquisition by foreign investors can be divided into non-listed enterprises M&A and listed companies M&A.For mergers and acquisitions of listed companies, the state issued a number of laws, rules, and regulations to standardize foreign merger and acquisition activities. The provisions of "the acquisitions approach " approved foreign investors'acquisition of non-tradable shares. "Qualified foreign institutional investors in securities investment management approach" allow qualified foreign institutional investors through secondary market trading of securities of listed companies to achieve the target of investment on listed company. "Strategic management approach" provided the way of investing on listed company through the form of strategic management approach and acquired the shares of shares changed listed company and company listed after shares changed. The form of acquisitions of non-listed companies is various. The text only briefly introduced control M&A, relative holding M&A, overall M&A and participation M&A.The chapter III is the anti-monopoly regulation to the M&A of domestic enterprises by foreign investors. M & A under the conditions of a market economy is the mechanism of survival of the fittest, optimizing the allocation of resources, improving the competitiveness of enterprises, and promoting economic and technological development. At the same time, corporate mergers and acquisitions may also be due to the excessive concentration of economic power to the detriment of competition and harm the interests of consumers, enterprises continue to undermine development. M&A by foreign investors as one form of corporate M&A is also a double-edged sword. Therefore, in order to effectively prevent the merger on competition may have negative effects. Usually the anti-monopoly law in the countries of the merger regulation produces specialized requirements.As mentioned earlier, the modest scale of foreign acquisitions can produce effects, and the anti-monopoly law only regulate over-regulation of mergers and acquisitions, mergers and acquisitions that monopoly. But how to judge whether a foreign acquisition had a monopoly effect, which relates to how to judge the merger of the monopoly of foreign capital in real terms that foreign standards and the conditions of monopoly issues such as mergers and acquisitions, and the existence of exceptional circumstances, to become a foreign antitrust merger exemption reasons, therefore, in view of the above problems, from the relevant national anti-monopoly of relevant experience, substantive rules, foreign capital to purchase anti-monopoly regulation should specify in the following aspects to consider: First, the ban on foreign investment in the acquisition of monopoly entities standards; Second, the conditions of monopoly of foreign acquisitions; Third, the waiver system of anti-monopoly regulation on M&A of foreign investors.The chapter IV is to study the model legislation of M&A of foreign investors. M&A practice can not be separated from legislative research. The United States is the world's most developed country and is also the most active countries on M&A. This chapter focuses on the United States and other developed countries of legislation on M&A by foreign investors, introduced at the same time developing countries M&A legislations, and in the comparative analysis of both developed and developing countries legislations on M&A by foreign investors proposed on the basis of perfecting China's M&A by foreign investors a number of envisage on M&A of domestic enterprises by foreign investors.