Panel urges ban on Chinese SOEs buying US firms

Reuters reports the US-China Economic and Security Review Commission, a congressional panel, said on Wednesday that US lawmakers should take action to ban China’s state-owned firms from acquiring US companies. The report said the Chinese Communist Party has used state-backed enterprises as the primary economic tool to advance and achieve its national security objectives. The report recommended Congress prohibit U.S. acquisitions by such entities by changing the mandate of CFIUS, the US government body that conducts security reviews of proposed acquisitions by foreign firms. If enacted, the panel’s recommendation would essentially create a blanket ban on US purchases by Chinese state-owned enterprises. CFIUS now has veto power over acquisitions from foreign private and state-controlled firms if it finds that a deal would threaten U.S. national security or critical infrastructure.