China’s National Security Review: a tit-for-tat response?

Bu, Qingxiu (2012) China’s National Security Review: a tit-for-tat response? Law and Financial Market Review, 6 (5). pp. 343-356. ISSN 1752-1440

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Abstract

China is gradually taking its place as a major regulator, exercising concurrent jurisdiction of the national security review along with the US and EU over high-profile cross-border mergers and acquisitions. The National Security Review (NSR) regulatory regime of foreign acquisitions has attracted significant attention recently with the establishment of China's counterpart to the Committee on Foreign Investment in the United States (CFIUS). Due to the intensified activities of sovereign wealth funds (SWFs) that are closely linked with states, CFIUS's broad discretion to deal with China's SWF-based investment may have a far-reaching impact on China's implementation of the newly enacted NSR regime. It is essential to design a mechanism that allows SWFs to maximise their positive attributes while safeguarding the apolitical integrity of the marketplace. Any disproportionate use of the NSR regime would inevitably bring about more unintended consequences, such as tit-for-tat protectionism. This represents an imminent threat to the tenuous recovery from the recent economic crisis, largely because of the increasingly intertwined and interdependent nature of the global financial markets. It is of utmost significance to evaluate the extent to which the updated legislation strikes a reasonable balance between preserving genuine national security interests and maintaining an open environment for investment.

Item Type: Article
Schools and Departments: School of Law, Politics and Sociology > Law
Subjects: K Law > K Law in General. Comparative and uniform Law. Jurisprudence > K0520 Comparative law. International uniform law > K1000 Commercial law
K Law > KZ Law of Nations
Depositing User: Qingxiu Bu
Date Deposited: 27 May 2013 09:48
Last Modified: 27 May 2013 09:49
URI: http://sro.sussex.ac.uk/id/eprint/45131
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