On The Standards Of National Security Review In Foreign Mergers And Acquisitions

The introduction of foreign capital is a double-edged sword for the host country,which not only brings great benefits such as capital,technology and advanced management,but also may pose a potential threat to national security,so in order to safeguard the fundamental interests of the country,it is necessary to carry out security review in the process of foreign capital mergers and acquisitions.The purpose of the national security review is to safeguard the fundamental interests of the country without changing the country’s overall investment policy.National security review system is the last line of defense to safeguard national security.When legal provisions such as anti-monopoly law and anti-unfair competition law are unable to maintain market order,which makes foreign M & A transactions threaten national security,as the last remedial measure,it examines the transaction in order to safeguard the fundamental interests of the country,but the current security review also has a practical hindrance to foreign investment.On the issue of achieving the balance between national security review and foreign investment,the review standard is the most prominent problem,because the vagueness of the review standard greatly enhances the discretion of the host country,and may also affect the normal business exchanges.To this end,it has become an inevitable requirement to review the accuracy and transparency of the standards and to reduce the political elements of the standards.However,how to maintain the balance between national security and the overall national investment policy has become a difficult problem for all countries.This paper will analyze the national security review standard from the perspective of foreign capital M & A.firstly,it analyzes the relevant treaties and national legislation,and summarizes the confusion of the current review standard;secondly,it analyzes the examples of national security review.It points out what reasons countries use to reject the transaction behavior of foreign capital M & An in practice,and how the entity standard of national security review is reflected in practice.Furthermore,it analyzes how countries prescribe the substantive standards of national security review,and summarizes the constituent elements of the current entity standards of national security review,such as the field of industry,the object of review and the definition of the right of control.it is pointed out that the fuzziness of the concept of national security,the different limitations in the field of review,and the different identification of foreign investors by countries are the main issues that run through the entity standards of national security review.Finally,the paper gives some suggestions on the application of the review standards,in order to make a modest contribution to the improvement of the national security review system under foreign mergers and acquisitions.