China Adopts Its First Anti-Monopoly Law

Key Points:

• Requires formal security examination of foreign investors seeking to invest in China-based companies
  
  

• Designed to protect industries key to China's economy
  
  

• State Council issues Provisions on Criteria for Filing of Concentration Of Undertakings
  
  

In August 2007 the Committee of the National People's Congress adopted the Anti-Monopoly Law, designed to enhance fair competition and regulation of the market. The new law took effect August 1, 2008.

Over the past year, businesses have had ample opportunity to gain an understanding of the law before being required to comply. Designed to protect key economic sectors, the law requires that investors from outside China seeking to invest in Chinese companies via merger, acquisition or capital investment undergo a formal security examination.