Germany Tightens Acquisition Rules Amid China's Push for Tech Deals
Germany Tightens Acquisition Rules Amid China's Push for Tech Deals
Germany is tightening rules to make it harder for non-European companies to buy stakes in German firms without its approval, signaling growing concern in Berlin about China’s push to acquire key technology and know-how.
China’s aggressive plans to purchase assets around the world has forced a series of countries to take steps to screen the investments, many times blocking them. The European Union has recently agreed to establish a common framework to tackle the issue. In the U.S., Congress has moved to strengthen the vetting procedures for transactions involving homegrown technology.
Despite that, U.S. national security officials have warned Beijing continues to exploit U.S. technology to develop its own economy, heightening tension between the two countries currently spatting over trade.
In Germany, growing concerns are forcing the government to tighten acquisition rules set only a year ago.
Germany’s cabinet is set to approve Wednesday rules stating that any non-European foreign company planning to buy more than 10% of a German company involved in defense, technology or media will see its deal probed by German authorities, according to people familiar with the plan.
Since 2017, the threshold has been 25%, which has applied to strategically important companies if the investment puts public order or safety at risk.
Germany hasn’t directly mentioned China as the target of the regulations, but it recently blocked two deals by the Asian powerhouse. In one case, it had to involve its state-owned bank since the stake in question was below the 25% threshold that would give the government blocking power.
In July, Germany’s KfW bank acquired a 20% stake in German transmission system operator 50Hertz Transmission GmbH’s holding company to fend off efforts by State Grid Corporation of China. It cited “national security grounds” for the move.
It has also blocked the sale of machine-tool company Leifeld Metal Spinning AG to a Chinese investor saying it risked “public order and safety.”
Other European countries have also prevented Chinese purchases this year. In February, the French government halted the sale of Toulouse airport to a Chinese consortium.
Chinese officials have called on the EU not to discriminate against foreign investments and uphold global rules. But EU officials say China itself fails to open its own market for foreigners.
As part of its efforts to ease tensions with the U.S., China is preparing a new program that would give foreign companies more access to the Chinese market. Its extent and effectiveness, however, is still unclear.
Write to Christian Grimm at christian.grimm@wsj.com and Patricia Kowsmann at patricia.kowsmann@wsj.com
SOURCE LINK BEST ONLINE NEWS WEBSITE https://www.beviral.online
Comentarios
Publicar un comentario