ANNOUNCEMENT 12 Feb 2011

In February 2011, the government of China announced a change in the technical requirements for goods market entry.

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising

SOURCE

PRC Central People's Government, February 12th, 2011. (国办发〔2011〕6号 国务院办公厅关于建立外国投资者并购境内企业安全审查制度的通知)
http://www.gov.cn/zwgk/2011-02/12/content_1802467.htm

PRC Ministry of Commerce, March 4th, 2011. (商务部公告2011年第8号,公布《商务部实施外国投资者并购境内企业安全审查制度有关事项的暂行规定》)
http://www.mofcom.gov.cn/article/b/g/201107/20110707651241.shtml

Inception date: 05 Mar 2011 | Removal date: open ended
Still in force

FDI: Entry and ownership rule

In February 2011, the Chinese Central People's Government released Guobanfa 2011/6, which introduced a requirement for foreign investors carrying out M&A-related investments in China to go through a security review process.
 
Starting from March of the same year, a joint ministerial conference system will be established that will conduct the security reviews of foreign M&A of domestic Chinese firms.
 
This procedure was in addition to existing requirements of an industrial access review and anti-monopoly investigation.
 
Officially, the security review is in place to determine whether the investee firm is:
 
  • Involved in the military industry or national defense/security;
  • Located near key and sensitive military facilities;
  • Involved in key agricultural production, major energy and resources, vital infrastructure, important transport services, core technology and major equipment manufacturing that may affect national security.

In addition, Guobanfa 2011/6 defines 'foreign M&A' as when a foreign firm invests in or purchases rights to the use of assets of a Chinese firm, such that the firm becomes either a part- or wholly-foreign-invested enterprise.

On March 4th, 2011, the PRC Ministry of Commerce released Announcement 2011/8, which stipulated some of the procedural requirements for those wishing to conduct M&A activities and requiring a security review, as well as bringing the measures officially into force. Please see second source for details.

AFFECTED SECTORS

 
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AFFECTED PRODUCTS

 
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