The Study Of The National Security Review System For Foreign Mergers And Acquisitions In USA

With the deepening of economic globalization, foreign mergers and acquisitions in the world is generally developing with a high speed. The influence of foreign capital from Merger and acquisition to the economy and society of a certain country can be said as a "double-edged sword". On the one hand, it will bring about more employment opportunities, increase revenue, promote technology innovation, however, on the other hand, to some extent; it can bring about security threat. The United States, as the world’s strongest developed country, particularly paid the most attention to the impact of foreign mergers and acquisitions. Since World War I, the United States began to pay attention to the review of the inflow of foreign investment. In1988, the implementation of "Exon-Florida Amendment", basically established the security review system of the United States of America on the M&a. After three revisions, it has been perfected. In2007the "foreign investment and National Security Act" represented the newest development of the review system. And since then, the national security review system of foreign M&A the United States has come to a new age.In recent years, the rapid development of economic accelerated the pace of foreign investment in china. But as to practice, it is a bit frustrated. December8,2004, Although Lenovo’s acquisition of finally succeeded, the complicated process of the review from CFIUS caused heavy transaction cost.The CFIUS held the opinion that Lenovo’s acquisition may pose threat for the national security of USA. Despite the fact that Lenovo successfully acquired IBM’s personal computer division, this case has caused widespread concern in the United States of the national security review system of foreign M&A in America in China; So it is the case of Petro China’s acquisition of Unical, and the case of Huawei. Both of the case aroused widespread concern; In the March of2012, the Sany Heavy Industry acquired4project Greek Power Grid Corp located in the United States of Oregon wind farm in the United States Associate Company Rawls company; in July, the CFIUS insist it posed threat to American national security grounds in Rawls and forced it to immediately stop the construction of the wind power project. And only certificated Americans are allowed to the area to remove all the equipment; subsequently, the CFIUS banned using the equipment of Sany Heavy Industry in the project. The project can only be transferred after it got certification; Moreover, in September, Obama issued the presidential decree that the wind power project of Rawls Company located in the United States of Oregon should be suspended. All these cases are reminding us the importance of a perfect national security review system.The alarm has ringed and China. Both the government and the people have realized the problem. However, as a developing country, even though they have realized the fundamental importance of a perfect national security review system. as to the level of legislation, in fact, it is still poor. The low level of coordination has also identified that there is still a long way to go. When it comes to the purpose of the National security review system of foreign M&A, it is not to hinder the inflow of foreign capital, but by setting the relevant system to regulate the inflow of foreign capital, so as to keep the balance of attracting foreign investment and national security. Based on the considerations, seriously study on the American national security review system, which is relatively mature, is of great importance of improving China’s foreign investment review system, as well as promoting the development of economic construction and national security.Chapter1introduces the important concepts to have a better understanding of the review system of foreign M&A, such as mergers and acquisitions, national security. All the introductions are based on the newest revision of the terms. Subsequently give an analysis of the review system of national security in foreign M&A and the principles of it. Clear understanding of the basic concepts and principles laid the theoretical foundation for the study of review system of foreign M&A. in America.Chapter2mainly introduces the process of the review system of national security in foreign M&A in the US. Before an introduction of Security Review of the process of the review system of national security in foreign M&A in the US, it first introduced the department responsible for it. On the basis of this, it presents a review of the four key procedures and time limit of it,after this, it summarizes the characteristics of the United States of America safety review, mainly in the three areas. of high efficiency, selectivity, and voluntary reporting systemChapter3is the analysis of the development process of he review system of national security in foreign M&A in the US. Brief introductions of the backgrounds of some terms are also presented..Finally, based on the analysis above, this part aims to draw some lessons from the American security review system. Before coming to the conclusion, it first analyzes the status of the national security review system for foreign mergers and acquisitions in China, describes the shortcoming of the system. As a comparison with that in USA, China has some deficiencies and we should learn from the essence of United States. In the end, practical policies are proposed in order to perfect the review system in China.Since China has implemented the policy of reform and open-up, especially after the accession to the WTO, China has see more and more closely interaction with other countries in trade. In the area of globalization:international trade is faced with both challenges and opportunities. As a big trading country in the world, China should pay more attention to the legislation of relative law on the review of national security in foreign M&A. This is not only the need of investment to foreign countries, but also to prevent the negative effect of foreign capital inflow on China’s national security, to safeguard China’s economic interests and national security and establish the country image. What we should pay attention to is, in learning from the United States we should not be blind. The United States is a developed country, China is a developing country. Different national conditions determine the institutional difference. Learning from the USA with no concern of the condition in China, we will be in a totally mass. In fact, when it comes to implementation, it would be very difficult. Only by referring to the experience of developed countries as United States and combine it with China’s national conditions and practice, can we establish a review system which has characteristics of our own, and sufficient in practice.