China’s Anti-Monopoly Merger Control and National Security: Interactions with Foreign Investment Law and Beyond

Pearl Tower, Shanghai, with traditional Chinese buildings in the foreground

Unlike the United States or the European Union, China has adopted a unique approach that combines foreign investment law and anti-monopoly law to protect national security in merger transactions.

Meirong Jin and Qian Li argue that anti-monopoly merger control has been an indispensable part of China’s national security protection framework, with four characteristics that make it a suitable tool for national security purposes, including its exterritorial reach, flexible substantive assessments, tailored merger remedies, and the institutional link between the dual responsibilities of China’s Ministry of Commerce. China’s combined approach ensures national security protection at the expense of the anti-monopoly law’s values in protecting competition and promoting economic efficiency.

Although this combined approach is likely to continue to be used in the near future, a possible alternative—namely, to restructure China’s national security review regime to apply in a nationality-neutral manner—could be a long-term fundamental solution.

By Meirong Jin

Meirong Jin is Associate Professor, School of Law, Renmin University of China.

By Qian Li

Qian Li is a Ph.D. Candidate in the School of Law, University of Würzburg, Germany.

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