The most recent draft of China's antimonopoly law will require regulators to review foreign purchases of Chinese companies to consider issues of national security, not just antitrust, state media reported. According to official statistics, foreign mergers and acquisitions accounted for 20% of all foreign direct investment in 2005, up from 11% in 2004 and 5% before that, with foreign companies beginning to acquire major state-owned enterprises in recent years. The Ministry of Commerce (MOC) will approve foreign investors' purchases of domestic companies or transfer of operating rights to see if national security is affected, according to a regulation issued by the MOC last year. The draft anti-monopoly law was submitted for first review in June 2006.
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