divestiture

Subscribe to divestiture via RSS

By Susan Ning, Hazel Yin, Al Wu, Sarah Eder and Lingbo Wei   King & Wood Mallesons’ Antitrust Group

NING, Susan (Xuanfeng)尹冉冉On 4 December 2014, the Provisions of the Ministry of Commerce on Imposing Additional Restrictive Conditions on the Concentration of Business Operators (for Trial Implementation) (hereinafter the “Provisions of Restrictive Conditions”) was officially enacted by the Ministry of Commerce of the People’s Republic of China (MOFCOM), based on its 2013 draft version (hereinafter the “2013 Draft Provisions”). Restrictive conditions in merger reviews are also referred to as “merger remedies”. Pursuant to Articles 28 and 29 of the Anti-monopoly Law (hereinafter “AML”), where a concentration of business operators will or may eliminate or restrict competition, MOFCOM may decide to attach restrictive conditions to its clearance decision in order to reduce the adverse impacts on competition. MOFCOM has given conditional clearance in 24 cases since AML came into effect. Given that the imposition of restrictive conditions on proposed transactions may impact heavily on the parties and the nature of the transaction, even altering the relevant market and development of the relevant industry, the publication of the Provisions of Restrictive Conditions will be of great significance not only to the merger review process, but also to the business decisions of the relevant companies.

The Provisions of Restrictive Conditions came into effect on 5 January 2015. At the same time, MOFCOM’s Interim Regulations on Implementing the Divestiture of Assets or Businesses in Concentrations of Business Operators dated 5 July 2010 (hereinafter “the Regulations on Divestiture”), were repealed. The Provisions of Restrictive Conditions will become an important reference point for the enforcement of restrictive conditions. The Provisions of Restrictive Conditions contain 7 chapters addressing restrictive covenants, including when such covenants will be imposed, the mechanisms for supervising their implementation, the consequences of failing to comply, the procedure for amending them and when the obligations will come to an end .
Continue Reading Developments to the Merger Control Regime in China: MOFCOM’s Provisions on Imposing Additional Restrictive Conditions on Concentrations of Business Operators (for Trial Implementation)

By Susan Ning, Pulcheria Chung, Kailun Ji and Hazel Yin

To increase clarity and transparency on the merger remedy regime under the Anti-Monopoly Law (“AML“), China’s Ministry of Commerce (“MOFCOM“) published the draft Rules Regarding Imposition of Restrictive Conditions on Concentrations of Undertakings (the “Draft Rules“) on 27 March 2013 for public comments. 

Under the AML, MOFCOM may attach restrictive conditions to reduce the negative impact a concentration of business operators will bring on competition in the relevant market.  On 5 July 2010, MOFCOM published the Provisional Rules on Divestiture of Assets or Business to Implement Concentrations of Undertakings (the “Divestiture Rules“) which was the first set of rules specifically dealing with divestiture remedies.  The Draft Rules are intended to cover not only divestiture, but also conduct remedies and will replace the Divestiture Rules once adopted.
Continue Reading Path towards A More Streamlined Merger Control System – MOFCOM Publishes Draft Rules on Merger Remedies

By Susan Ning and Hazel Yin

On June 15, 2012, the Ministry of Commerce (“MOFCOM”) approved the acquisition of Goodrich Corporation (“Goodrich”) by United Technologies Corporation (“UTC”) subject to the divestment of the electronic systems business of Goodrich.  Both companies are headquartered in the United States and active in the production and sale of aviation equipment.  This marks the fourth conditional clearance issued by MOFCOM in the first half of 2012 and the only case where the core remedies are structural.

 Review Process.  MOFCOM received the notification on December 12, 2011 and officially accepted it on February 6, 2012.  A Phase 2 investigation was opened on March 2 and extended on May 31, which was set to expire on July 30. 
Continue Reading MOFCOM Approves UTC’s Acquisition of Goodrich with Divestiture Requirement

By Susan Ning, Liu Jia and Angie Ng

In March every year, lawmakers and political advisers from the National People’s Congress (NPC) (Chinas equivalent of Parliament) and the Chinese People’s Political Consultative Committee (CPPCC) (China’s top advisory body) conduct sessions in Beijing to take stock of social, legal and economic issues in China for the preceding year; and discuss objectives (in relation to the same issues) for the year going forward1.    These sessions are often referred to as the "two sessions".

Two statements which have arisen during these two sessions; are of particular interest (from an antitrust law perspective):
 Continue Reading The annual “two sessions” and antitrust law noises

 By Susan Ning, Jiang Liyong and Angie Ng, King & Wood’s Competition Practice

On 5 July 2010, the Ministry of Commerce (MOFCOM) enacted regulations which set out the rules and procedures to do with divesting assets. These regulations are entitled “Interim Regulations on Implementing the Divestiture of Assets or Businesses in Concentration of Business Operators” (divestiture regulations). A copy of the divestiture regulations are located here.
 Continue Reading Regulations on Divesting Assets – Enacted