Interim Provisions on Mergers and Acquisitions of Domestic Enterprises by Foreign investors
Updated: 2006-04-17 10:20 Articles of association and the contract of the foreign investment enterprise
to be submitted as required by law;
(5) the foreign investment enterprise
approval certificate ;
(6) identification documents or incorporation
certification and creditworthiness certification of the foreign investors;
(7) the amended list of directors, the document specifying the names and
addresses of new directors and the documents of appointment of new directors;
and
(8) other relevant documents and certificates required by
SAIC. In case of the transfer of state-owned equity interest and in case of
foreign investors' subscription to any increased capital of a company with
state-owned equity interest, the approval documents of the authority in charge
of economic and trade administration shall also be submitted. Investors shall,
within 30 days upon the receipt of the foreign investment enterprise business
license, handle the necessary registration formalities with authorities for
taxation, customs, land administration and foreign exchange administration,
etc..
Article 19 In case of any of the following occurrences in connection with the
merger or acquisition of a domestic enterprise by foreign investors, the
investors shall submit notification to MOFTEC and SAIC:
(1) the revenue of a
party to the merger or acquisition in the domestic market for the current year
exceeds RMB1.5 billion ;
(2) the foreign investors have merged with or
acquired more than 10 domestic enterprises in aggregate engaging in the related
businesses within one year;
(3) the market share of a party to the merger or
acquisition in the domestic market has reached 20%;
(4) the market
share of a party to the merger or acquisition in the domestic market will reach
25% as a result of the merger or acquisition. Even without the above
occurrences, MOFTEC or SAIC may still require the foreign investors to submit
notification upon the request by any competing domestic enterprise, relevant
functional department or industrial association, if MOFTEC or SAIC finds that
the merger or acquisition will involve a huge market share, or if there is any
other material aspect of the merger or acquisition which might severely affect
market competition, national economy or people's livelihood and national
economic security. The above-mentioned "a party to a merger or acquisition"
shall include any affiliated enterprise of foreign investors.
Article 20 In case of any of the described in Article 19 in connection with a
merger or acquisition of a domestic enterprise by foreign investors, and if
MOFTEC and SAIC believe that the merger or acquisition might lead to
over-concentration, impair fair competition or damage consumers' interests,
MOFTEC and SAIC shall, within 90 days upon its receipt of all the documents
required to be submitted, jointly or separately after consultation with each
other, hold a hearing of the relevant departments, organizations, enterprises
and other related parties and decide according to law whether to approve the
application for the merger or acquisition.
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