China mulls lifting merger filing thresholds

China mulls lifting merger filing thresholds

Significant changes to merger control procedures have been proposed by the antitrust enforcement authority, raising the existing turnover-based threshold and adding a new hybrid threshold based on turnover and market value.

The State Administration for Market Regulation (SAMR) issued the draft changes for public comments on 27 June 2022, immediately following amendments to the Anti-Monopoly Law.

They cover key supporting rules and regulations on cartels and vertical restraints, abuse of dominance, abuse of IP rights, merger control procedures, merger control thresholds, and administrative monopoly.

The proposed changes intend to materially raise the current existing turnover thresholds, requiring:

    1. China-wide turnover for each of at least two of the parties to the concentration over RMB800 million (USD114.2 million), up from RMB400 million;
    2. Combined worldwide turnover of all the parties to the concentration over RMB12 billion, up from RMB10 billion; or
    3. Combined Chinese turnover of all the parties to the concentration over RMB4 billion, up from RMB2 billion.

In addition, the proposed changes add a new hybrid threshold presumably aimed at competitively significant acquisitions, also known as killer acquisitions, requiring:

    1. China-wide turnover of one party to the concentration over RMB100 billion; and
    2. The other party to the concentration has valuation/market value over RMB800 million, and China-wide turnover over one-third of its total turnover.

The above-mentioned proposed changes are still under consultation following public comments until 27 July 2022. It remains to be seen whether there are further changes, and when the revised filing thresholds will come into effect.

Business Law Digest is compiled with the assistance of Baker McKenzie. Readers should not act on this information without seeking professional legal advice. You can contact Baker McKenzie by e-mailing Howard Wu (Shanghai) at: