Chinese Merger Review: The Amended AML and Proposed Regulatory Revisions

Summary 

---

|

• The Amended AML and proposed revisions to implementing rules will enable SAMR to reach transactions beyond its current jurisdiction, manage its merger docket more flexibly, allocate resources to transactions of greater concern, and raise the penalties for circumvention.
• Many of the proposed revisions will selectively integrate established foreign enforcement principles, or track efforts by foreign competition regulators to address challenges arising in online sectors.
• The Amended AML also enables SAMR to investigate potentially anticompetitive deals that might otherwise slip under the mandatory notification thresholds. 

China is retooling its framework for assessing the potential anticompetitive effects of mergers, acquisitions, and joint ventures under the Anti-Monopoly Law (AML) (反垄断法).  On June 24, 2022, the National People's Congress (NPC) amended the AML for the first time since its enactment in 2007; the "Amended AML" takes effect August 1, 2022.  On June 27, 2022, the National Anti-Monopoly Authority of the State Administration for Market Regulation (SAMR) released for public comment draft revisions to key implementing regulations, including the State Council, Provisions on the Thresholds for Filing of Concentrations of Business Operators (Amendment Draft for Comments) (国务院关于经营者集中申报标准的规定 (修订草案征求意见稿) (the Draft Thresholds) and the State Administration for Market Regulation, Provisions for Reviews of Concentrations of Business Operators (Draft for Comments) (国家市场监督管理总局经营者集中审查规定 (征求意见稿)) (the Draft Merger Rules).  The Amended AML and proposed rules would enable SAMR to reach transactions currently beyond its jurisdiction, manage its merger docket more flexibly, allocate resources to transactions of greater concern, and raise the penalties for circumvention.

Any transaction qualifying as a "concentration" (such as mergers, acquisitions, and certain joint ventures) and satisfying the mandatory notification thresholds set by the State Council must be reported to SAMR for review