China to update M&A Regulations in 2024: Changes to Filing Thresholds

China’s State Council has implemented revised Provisions on Declaration Standards for Business Operator Concentration, effective from January 22, 2024. Originally proposed by SAMR in June 2022, the 2024 Provisions have raised turnover criteria, benefiting big tech firms and multinational companies involved in M&A activities.

China’s State Council has released the revised Provisions of the State Council on Declaration Standards Regarding the  Concentration of Business Operators, which took effect from January 22, 2024.

The 2024 Provisions were initially proposed by the State Administration for Market Regulation (SAMR) in June 2022. The comparatively slow legislation process indicates the Provisions had been subjected to heated discussion within the government organs.

Notably, the 2024 Provisions dropped some specific standards proposed in the 2022 draft that required any deal involving a company with annual China revenues over RMB 100 billion to be subject to review by the authorities. According to analysts, this roll-back was designed to favor the big tech firms originally, but will concurrently benefit all multinational companies (MNCs).

This article delves into the significant revisions to China’s M&A declaration thresholds and their implications, providing crucial insights for businesses and stakeholders involved in merger activities.

The 2024 Provisions have significantly raised the turnover criteria for the declaration threshold for concentration of undertakings.

The term “concentration of undertakings” refers to any of the following circumstances:

This article is republished from China Briefing. Read the rest of the original article.

China Briefing is written and produced by Dezan Shira & Associates. The practice assists foreign investors into China and has done since 1992 through offices in Beijing, Tianjin, Dalian, Qingdao, Shanghai, Hangzhou, Ningbo, Suzhou, Guangzhou, Dongguan, Zhongshan, Shenzhen, and Hong Kong. Please contact the firm for assistance in China at china@dezshira.com.