New Chinese Antimonopoloy Law Threatens Microsoft

A new Chinese antimonopoly law may put another hurdle in front of Microsoft’s hostile-takeover attempt against Yahoo. With this law, China is flexing its power in the global marketplace by joining the U.S. and the European Union as a global business regulator, according to The New York Times.

Going into effect on August 1, the law allows Chinese regulators authority to look at foreign mergers when they involve acquisitions of Chinese companies or foreign companies investing in Chinese operations.

Nathan G. Bush, an antitrust law specialist with O’Melveny & Myers in Beijing, said the law represented the ascendance of China “as another regulatory capital contending for influence with Brussels and Washington.”

“Multinational corporations will need to develop strategies for all the markets they operate in,” he added, “and China is a big market.”

Whether China would seek to review a Microsoft acquisition, and what kind of posture it might take, would be closely watched by regulators and global companies as an indication whether it will play a conciliatory or a nationalistic role on the world stage.

In 2005 Yahoo purchased 40 percent of the Chinese e-commerce business, which allows China to examine Microsoft’s bid.

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