Rules for security review of foreign mergers and acquisitions to delineate industry scope

February 16, 17th, the National Development and Reform Commission and the Ministry of Commerce successively on foreign mergers and Acquisitions security review system external questions. China's foreign investment in 2010 reached $105 billion trillion, the first to break billions. But the share of mergers and acquisitions is only 3%.　　In stark contrast, last year, the global 1.12 trillion dollar foreign direct investment, the proportion of mergers and acquisitions reached 70%.　　February 17, the Ministry of Commerce spokesman Yao Jian with the above two sets of figures affirmed that mergers and acquisitions will become the future of China's foreign investment development trend.　　Yao also revealed that foreign capital mergers and acquisitions of domestic enterprises after the security Review Mechanism, the Ministry of Commerce as the relevant application of the receiving unit, at the same time as an important member of the Joint Meeting, the Ministry of Foreign Affairs of Mofcom is drawing up a more detailed, operable implementation measures, the implementation of the detailed rules will be In this respect, Wang Xiaoyu, Deputy secretary general of Heilongjiang Soybean Association, said that the whole chain of soybeans, which is controlled by foreign capital, may have a new chance to get rid of foreign capital control.　　However, it is not clear whether soybeans can be included in the list of safety review industries as "important agricultural products related to national security".　　The industry hopes to introduce details as soon as possible, otherwise the unclear definition will affect the further development of foreign direct investment. The review is conducive to China's absorption of foreign capital mergers and acquisitions accounted for the proportion of foreign investment in China has once reached 11% "the policy is generally to further promote the development of foreign-funded enterprises in China, to share the results of China's reform and opening-up.　　"The establishment of a security review system is an international practice and will further improve the quality and structure of China's foreign investment structure and provide better conditions for the next step in absorbing foreign investment," Yao said at the Ministry of Commerce's routine press conference on February 17. According to the February 3 "on the establishment of foreign investors merger and acquisition of domestic enterprises Security review System Notice", foreign investors gain real control, generally holding more than 50% of the total shares, will conduct security review, including on national Defense security, national economic stability, social basic living order,　　Related to national security key technology research and development capacity impact. National Development and Reform Commission people pointed out that the introduction of the review system does not mean that China's foreign policy tightening. To establish a security review system for foreign capital mergers and acquisitions, focusing on perfecting the policy and regulatory system of foreign capital utilization, improving transparency and predictability, and promoting the orderly development of foreign mergers and acquisitions.　　At the same time, the above policy has solicited the views of multinational corporations and foreign chambers of commerce. According to the UNCTAD figures, in 1991-2005, China's foreign capital acquisition investment accounted for the average proportion of foreign direct investment in about 4.7%.　　One of the highest in the single year is 2004, 2005, the proportion reached more than 11%.　　According to the Ministry of Commerce, in 2010, China's absorption of foreign investment accounted for the proportion of total investment fell to about 3%.　　Chongmei, deputy director of the Foreign Investment Research Department of the Institute of Commerce, told reporters that this is related to the scrutiny of foreign acquisitions in recent years. Chongmei that the introduction of moreAfter the detailed scheme, it is possible to define which industries are not covered by the security Review, which will benefit the steady growth of foreign mergers and acquisitions and increase the proportion of FDI in foreign direct investment. "Foreign direct investment is expected to continue to grow rapidly in the next few years, at 10% to 20%, and investment in mergers and acquisitions should be encouraged in the future, which is beneficial to the technological upgrading of enterprises."　　"Chongmei said.　　Yao said that with the gradual expansion of mergers and acquisitions in foreign investment, the proportion of FDI in foreign direct investment may be 8% and 10%.　　The industry looks forward to a clear review of the list Soybean Industry association questions, soybean is not counted as "important agricultural products" however, how to define foreign-funded enterprises, and how to define the industry under review is a difficult problem.　　According to the notice, the scope of the security review of mergers and acquisitions is as follows: foreign investors acquire the national security military and military supporting enterprises, important agricultural products, important energy and resources, important infrastructure, important transportation services, key technologies, major equipment manufacturing and other enterprises, and the actual control rights may be obtained by foreign investors. In this respect, Wang Xiaoyu said, "The soybean industry is controlled by foreign investment situation, is already a fait accompli." are soybeans and downstream fats counted as important agricultural products? How much of the proportion of foreign capital control is needed to be investigated?　　Wang Xiaoyu hope to see the answer as soon as possible. Zhang, of Lange Iron and Steel Information Research Center, said that a Russian firm had failed to acquire a civilian steel company in Xingtai, Hebei, after years of successful mergers and acquisitions of a steel firm in Hunan province.　　The industry hopes that the conditions for foreign mergers and acquisitions can be further clarified.　　Jiang, director of the Center for Economic Security Research at the China Institute of Modern International Relations, cautioned that many foreign companies are now investing in Chinese companies, which are defined as Chinese enterprises, and that it is also a matter for them to consider whether foreign acquisitions and takeovers by foreigners are subject to security review. "Foreign capital has the means to get rid of mergers and acquisitions security Review, just as many domestic companies have been detours to enjoy foreign-funded preferential policies many years ago." These problems need to be addressed.　　"Jiang said. Chongmei stressed that some of the unapproved mergers and acquisitions in recent years were not due to safety audits, such as Coca-Cola's takeover of Huiyuan, but mainly to the concentration of industry. This is not the same thing as some industry mergers and acquisitions that have been rejected because of national security concerns.