Since China’s merger control regime under the Anti-Monopoly Law (AML)
was established in 2008, the enforcement record has given rise to growing concern
that the system is inherently biased against foreign multinationals. This article
conducts an analysis of the evolution of China’s merger review system to assess
this charge and its implications. China’s steady economic development fueled by
foreign investment has led to a domestic market featuring strong foreign presence.
Foreign-domestic competition figured as an important issue for the policymakers,
especially in anticipation of China’s entry into the WTO. This concern precipitated
the establishment in 2003 of the country’s first merger review system, which only
applied to M&As by and between foreign companies. Although the AML on its
face applies generally to both foreign and Chinese firms, enforcement authorities
have only intervened in foreign takeovers. China’s merger control regime is different
from that of mature market economies and has significant implications for
itself as well as foreign investors.
