By Yin Chunquan

Date: 2004-08-19

Abstract:

One of the major tactics in acquiring China's market share used by the multi-national companies is to get the capital of Chinese enterprises through M&A. However,there are problems in the regulation of M&A in China with foreign capital involved: the incomplete system of laws and regulations; the insufficient intermediate agencies, misunderstanding in introducing foreign capital;distorted treatment of public resources; and lack of core technology and intellectual property rights in reorganization of capital. The policy of fostering private enterprises and restraining the state-owned enterprises is not fully carried out. This paper points out the right direction for M&A when foreign capital is involved, and the principle of combining foreign capital with China's own new industrialization strategy, based on empirical studies. In addition, policy recommendations are made in terms of issuing anti-monopoly laws.