Foreign Conditional Acquisition System Research In China

Foreign mergers and acquisitions is one of the most important means of expand the operation scale, improving economic efficiency, expanding economic power. But, the suddenly becoming a strong cooperation, with its increasing important of market position, has changed the existing market structure, and lead to the emergence of anti-competitive effects. Thus, in order to ensure high economic efficiency and healthy competitive environment of the market, competition authorities attach certain limits to the approval of multinational M&A activity to limit or impair the anti-competitive effects bring by M&A activity and ensure the healthy development of the market and the steady increase in economic efficiency. Such a system is called merger remedy.In comparison with the antitrust regulation of developed countries, which have long history in anti-monopoly, China’s exploration for antimonopoly began in2008, which is also the beginning of merger remedy in our country. And its development began from the first case in2009, by now have been three years. Since the implementation of anti-monopoly law, China’s Anti-Monopoly Department under the Ministry of Commerce has approved10merger remedy cases. While dealing every theoretical issue arisen in each case, the authorities is also learning the other countries’ experiences and stepping up the pace of the introduction of legal documents. This paper will make analysis on the said10cases with theoretical research and some suggestions for improvement. The following is the structure of this paper:The Chapter I outlines the legal system of foreign M&A. First, it introduces the basic theory of foreign mergers and acquisitions, including the meaning, the reason and two types of foreign acquisitions. Then, it discusses the basic anti-monopoly issues of foreign M&A, and the values and basic principles. Finally, it introduces two means of dealing the foreign M&A case. Here, it is focused on several factors that competition authorities will take into consideration when they forbid a foreign M&A case. Then, it proposes the concept of merger remedy to connect to the next chapter.The Chapter Ⅱ is the analysis of the theory of merger remedy. First, it describes five principles that applied in merger remedy and then analysis it from two respects, one is structural remedy and the other is behavioral remedies.Secondly, it focuses on the analysis of Divesture. It is the most important means of structural remedies. In order to ensure healthy competition in the market, the cooperation should divest a package of assets or a ongoing business to the third party.The other type of merger remedy is behavioral remedies, which includes fire-wall clause, fair trade clause, is imposing obligations on the merging cooperation to limit its conducts.The Chapter Ⅲ lists the regulations of U.S. and EU, including a variety of anti-monopoly guidelines, reports and recommendations as well as case laws which component the U.S. and EU anti-monopoly legislation system. Finally, four regulations of our country are discussed.The Chapter Ⅳ is the analysis of10cases. Each of them has its own characteristics and focuses on different theories. The second part of this chapter lists three problems found in the program, and puts forward three suggestions for improvement. They are strictly used on hearing procedures in order to establish accountability system, and strength antimonopoly cooperation between countries.As a developing country, China is still a long way to go for enforcement of anti-monopoly law. Only by learning the US and EU’s experience is not enough for building our legal system. China’s competition authorities should take the characteristics of national policy, market economy and social environment in to condition, while migrating of others’legislative experience.