Ministry to Issue New Rules to Give Authorities More Freedom in Handling Mergers
The ministry of commerce is planning to issue new rules that will be drafted during the first half of the year that will give authorities more freedom in global merger transactions so that they may have an impact on domestic customers. China is increasing its use of antitrust rules and impose conditions on global deals which includes the billion dollar merger with Swiss bases miner Glencore Xstrata PLC.
The ministry of commerce reviewed around 750 merger proposals since 2008 after the establishment of the country’s anti monopoly law including blocked proposals and imposed conditions on 21 more. Once a merger creates an anti competitive impact the country is going to pay attention to the merger and will work on verifying the deal.
The Ministry of Commerce anti monopoly director general said that the ministry has already introduced the rules during the first half of this year and replaced old regulations that were implemented in 2010. The ministry is fast becoming involved in regulating overseas merger, this month alone the ministry was responsible for streamlining procedures for simpler proposals that involved companies that have low market shares or Chinese offshore ventures that have no domestic businesses.
Last year the ministry has already agreed to Glencore idea of buying Xstrata as long as they sold Xtrata’s Las Bambas copper project in Peru along with the guarantee of giving a long term supply of copper concentrate for its Chinese customers. The ministry has also asked Google to continue its licensing of their Android mobile operating system in a free and open source environment after the firm bought Motorola Mobility Holdings in 2012.