Anti-monopoly, National Security and Industrial Policy: Merger Control in China

Abstract

China has attracted the world’s attention since it enacted its Anti-monopoly Law (AML) in August 2007. Discussion relating to merger control is frequently focused on the AML, without adequate observation to other legislation. This article argues that competition matters, which are embodied in the AML, are not the whole of the existing regime of Chinese merger control. A three ‘pillar structure’ of the regime in relation to foreign mergers, that is, anti-monopoly review, national security review, and entry review, may be seen to have been formed. Competition, national security, and industrial policy may all be considered in the assessment of foreign mergers. While it remains to be seen how industrial policy will precisely be advanced in both legislation and practice, the policy may occupy a major position in the current regime. This is understandable given the current stage of the China’s economic transition. Policy makers are however urged to establish a merger control regime that is clear-cut and transparent, from which legal certainty flows.