Brussels will strike the playful hands of Beijing

14 August 2017, 18:05 | Economy
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The European Union has seriously and permanently decided to attend to the growing business activity of China against a number of key European companies, trade networks and the industrial sector. Simply put - the European Commission wants to assume the functions of a financial regulator and begin a total control over all transactions with the Middle Kingdom, both mergers and acquisitions.

According to an influential British publication, referring to its own sources, a large-scale company to "restore order" in this sector in the near future is announced by the head of the European Commission Jean-Claude Juncker, writes Financial Times.

The fears of Europeans are not groundless. According to the EU, if not to establish total regulation, China will not only be able to access the latest European technologies, but beyond the Middle Kingdom will be a competitive advantage. After all, one can not fail to note the important fact that the intellectual property of Chinese companies themselves is strictly protected by the Chinese authorities and remains inaccessible to European investors even in the case of merger deals.

British newspaper leads the audit of lawyers from Baker McKenzie and the research company Rhodium. Data is disappointing, if not worse: according to the results of 2016. The volume of direct foreign investment of China to the US and Europe still more than doubled and reached a record $ 94.2 billion.

In its desire to establish control over all transactions with the Chinese, the European Commission wants to take an example from the US and Australia and a number of developed countries. In these countries, all the more or less serious transactions with the Celestial business go through the sieve of financial regulators of these countries. And with the slightest suspicion that mergers and acquisitions can do any harm to their own economy, the conclusion of the contract is blocked at the governmental level.

For example, at the end of 2016. Then-President Barack Obama blocked the purchase of the German semiconductor manufacturer Aixtron by the Chinese investment fund Fujian Grand Chip, banning the sale of a stake owned by US investors, since this would jeopardize US national security. Repeated attempts by the Chinese concern Huawei to acquire American technology and industrial companies also failed.



Thus, only in the past year, Chinese companies lost about 30 foreign acquisitions worth $ 75 billion. The enthusiasm of Chinese investors is constrained by the restrictions of foreign regulators.

Currently, the EU is fragmented in this matter and looks like a sluggish goose because of its slow bureaucracy. As a consequence, only 13 out of 28 countries control investments and acquisitions in local companies from the national security point of view.




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