U.s. Antitrust Law Merger Control Entity Standard Study

As an important enterprises expanding tool, M & A (Merger and Acquisition) exert two effects on the market. First, it can accelerate the economic progress by expanding the scales; however, on the other side, it will lead to a monopolistic statute when competitors are squeezed out and the market structure is deformed. Therefore, merger control or merger regulation is an essential component of the Antitrust Law in different countries.The substantive standard of merger control policy, which could reflects the core value of the antitrust law and the attitude towards the competition of a country, is the key factor to determine whether a merger should be forbidden by the antitrust agency.The antitrust law of People's Republic of China, which comes into effect in Aug. 1, 2007, introduced the "merger control" or "concentration regulation" by one whole chapter, which received increasing attention in China. With the concern of the economic reform and the enhancement of industrial structure progress, the public realized that M&A will lead to a monopolistic market structure, which will restrain market competition and undermine social welfare, as long as it was not regulated.The U. S. was the first country to apply Antitrust Law to control the M & A. As the substantive standard is the key point of the Antitrust Law, which reflects the valueof it, the U. S. Antitrust Law sets its standard as "SLC--substantial lessening ofcompetition" in the Clayton Antitrust Act of 1914. With the development of the politic, economic and social environment, however, the application of the standard experienced a change from "Structure Orientation" to "Efficiency Orientation" during the history of the Antitrust Law.During the history of the antitrust law, economic analysis greatly affected the policy of merger control. The Harford study group emphasis their attention on the structure of the market. According to their point of view, the market structure is the only problem to be considered in the merger control cases. However, the Chicago study presents their favor in the efficiency in the merger analysis.With the consideration of the Chinese condition, this paper attempts to provide a reference of the application of the substantive standard of merger control in China, by analyzing the development of U. S. Antitrust Law and the practice.The paper could be divided into four parts.Chapter 1 introduces the concept of merger control, the relationship between merger control and development of economy of scale, the target of merger control and the substantive standard of the merger control policy.With a historic point of view, chapter 2 introduces the substantive standard of merger control in U. S. antitrust law.Chapter 3 provides a detailed analyze of the substantive standard by divide it into three elements: market definition, study of the market share and concentration, and the potential anti-competition result from the merger.Chapter 4 is due to reflect the essential value of the antitrust law of U. S. by intruding the exemption of the substantive standard, which includes market entry, efficiency and bankruptcy.With the consideration of the Chinese condition, the last chapter attempts to provide a reference of the application of the substantive standard of merger control in China. In fact, the merger control policy and the development of economy of scale are not contradictory, and they may even supplement each other. With the concern of the development of economy in China, the merger control policy should adopt a loose policy.