SOE Trim-down Collides With Antitrust Law

From Economic Observer Online:

A wave of consolidation among Chinese state-owned firms (SOEs) have collided with the tide of antirust exercises as China’s first ever came into effect on Aug 1.

The Law has come two years ahead of the targeted deadline for 149 SOEs to be consolidated into between 80 and 100 firms.

Some held that since the SOEs intergration was government-driven, the firms would be exempted from antitrust review by the Ministry of Commerce; while others held that the Law had clearly stipulated when corporate consolidation reached a certain scale, antitrust assessment must set in.

By the new law, corporate restructuring which involves a certain level of capital should receive antitrust assessment from the Ministry of Commerce (MOC). Mostly known as giants, SOEs would apparently have to go through such assessments if they were to be reorganized.

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