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China passes anti-monopoly law, with provision for security check on foriegn firms

China passes anti-monopoly law, with provision for security check on foriegn firms

China's legislature passed an anti-monopoly law Thursday that will require purchases of Chinese companies by foreign firms to go through a national security check, state media said.
Xinhua News Agency said the Standing Committee of the National People's Congress "adopted the anti-monopoly law to ensure fair competition and regulate market order."
The law will come into effect on Aug. 1, 2008.
"The law requires foreign purchases of Chinese companies to go through national security checks," Xinhua said without providing further details.
China began drafting the law in 1994 and a first draft was completed in 2003.
But progress was stymied by controversy over how to carry out enforcement, given the prevalence of state-owned monopolies or semi-monopolies in many industries.
Beijing officials have said the legislation would not discriminate between domestic and foreign companies.
The American Chamber of Commerce in Beijing issued a statement saying it welcomed the law "as a positive step in China's ongoing development of a market-based economy."
The law is a "defining moment in the development of China's legal system, which establishes a basic framework to build a fair, uniform, and national competition law system that benefits consumers by recognizing and preserving the incentives to compete," chamber chairman James Zimmerman said in the statement.


Updated : 2021-02-26 12:27 GMT+08:00