Beijing plans review system for foreign buyouts

The Chinese government is putting together a formal system for assessing the national security implications of foreign acquisitions of Chinese companies, the Wall Street Journal reported. Rules for a national security review – which would be separate from the Ministry of Commerce’s own review of acquisitions’ effect on competitiveness – have not been released. However, provisions for the process appeared in the anti-monopoly law that was enacted in earlier this month. Some observers have commented that the review will resemble the Committee for Foreign Investment in the US, the panel that has overruled deals such as China National Offshore Oil Corp’s 2005 bid for Unocal. Businesses have feared that such a panel could be used for protectionist ends rather than purely for national-security reasons.