China Implements a Security Review System for Certain Mergers and Acquisitions of Domestic Enterprises by Foreign Investors

The Chinese State Council has officially implemented a Security Review System for Mergers and Acquisitions of Domestic Enterprises by Foreign Investors (the “Review System”) based on a set of interim rules (the “Rules”) issued earlier this year.

Mergers and acquisitions by foreign acquirers (“M&A”) will be reviewed under the Review System based on factors such as the target’s industry, the type of M&A, and the right to de facto control. Foreign acquirers must submit an application to China’s Ministry of Commerce (“MOFCOM”) for review prior to certain mergers or acquisitions of a domestic enterprise.

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Published In: Administrative Agency Updates, Business Organization Updates, International Trade Updates, Mergers & Acquisitions Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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