Be familiar with M&A details before security review submission

New procedural regulations for the M&A security review clarify that foreign companies should, before making a formal submission, thoroughly know all the details of a proposed M&A.

This is because documents to be submitted will require extensive descriptions and a consultation opportunity with the governing regulator would only be effective if the correct information is discussed.

On March 4, the Ministry of Finance and Commerce (Mofcom) issued provisional rules regarding procedure for the new national security review for foreign mergers and acquisitions (M&As) of domestic entities, the Tentative Provisions on Matters Relevant to the Implementation of the System for Security Review of Acquisition of Domestic Enterprises by Foreign Investors (实施外国投资者并购境内企业安全审查制度有关事项的暂行规定). These provisions are open to public comment and are due to expire on August 31 2011. After this, amendments based on submitted comments may be made and a formal regulation will be issued.