Sharon Pang, Elizabeth Xiao Wang, Feb 26, 2013
Understanding the requirements of different merger control regimes and coordinating a coherent approach across multiple jurisdictions is crucial to a successful global M&A strategy. China has become a major regulatory hurdle for cross-border transactions with a growing number of global mergers and acquisitions facing extensive scrutiny by its merger control agency, the Anti-Monopoly Bureau at the Ministry of Commerce (“MOFCOM”). Since China’s Anti-Monopoly Law (“AML”) came into effect in 2008 through December 2012, MOFCOM has reviewed more than 520 filings. Of these, it has rejected one transaction outright and approved 16 others with conditions. In those transactions in which it intervened, MOFCOM raised considerable competitive concerns.
While economic analysis has clearly played an increasingly important role in MOFCOM’s merger review, relatively little information is available to shed light upon the analytical framework employed by MOFCOM beyond the information documented in the published decisions. MOFCOM issued an official decision for each of the 17 transactions in which it intervened. The decisions summarize the agency’s economic findings and discuss its competitive concerns. In this article, we examine the six decisions issued in 2012, discuss MOFCOM’s evaluation of each key factor in a standard competitive analysis, and summarize the overall trends of MOFCOM’s analysis of these economic factors.