Mergers in the Global Markets (eBook)

Acknowledgements 5
Contents 6
Abbreviations 12
List of Figures 13
List of Cited Cases 1
Part I Mergers and Acquisitions Policies and Approaches 16
1 Overview of Mergers and Acquisitions 17
1.1 General 17
1.2 Methods of Business Combination 18
1.3 Motives for Acquisitions 21
1.4 Acquisitions and Growth 23
1.5 Financial Analysis 24
1.6 Accounting for Mergers 25
1.7 Merger Negotiation and Due Diligence 26
1.8 Financing the Deal 27
1.9 Post-merger Integration 28
1.10 Cultural Issues in Cross-Border M& A
2 Economic Effects of Antitrust Laws on Mergers and Acquisitions 30
2.1 General 30
2.2 Antitrust Law Objectives 31
2.3 Competition Laws and Market Efficiency 31
2.3.1 Efficiency Assessment in the European Union 31
2.3.2 Competition and Market Efficiency in the United States 32
2.3.3 Competition and Market Efficiency in China 33
2.4 Competition Laws and Consumer Welfare 33
2.4.1 Competition Laws and Consumer Welfare in the EU 33
2.4.2 Competition Laws and Consumer Welfare in the United States 34
2.4.3 Competition Laws and Consumer Welfare in China 36
2.5 The Economic Effects of Competition on Mergers and Acquisitions 36
2.5.1 Decline in Enforcement 37
2.5.2 The Reasons for the Decline 38
2.5.3 The Pursuit of an Uncertain Goal 39
2.5.4 The Unfitness of the Welfare Protection Standard 40
2.6 The Harmfulness of Some Currently Approved M& A
2.7 Raise of Concentration 42
Part II The Competition and National Security Reviews 44
3 M& A Policies Review Under the Competition and National Security Laws in the United States
3.1 General 45
3.1.1 The Sherman Act of 1890 45
3.1.2 The Clayton Act of 1914 46
3.1.3 The Cellar–Kefauver Act of 1950 47
3.1.4 The Scott–Hard–Rodino Improvement Act of 1982 47
3.1.5 The Federal Trade Commission Act 48
3.1.6 The Foreign Trade Antitrust Improvements Act 49
3.1.7 The Department of Justice (DOJ) Antitrust Enforcement Unit 50
3.2 FTC–DOJ Procedure 52
3.3 Remedies 59
3.4 M& A Review Under National Security Laws in the United States
3.4.1 The National Defense Act of 1950 (as Amended) 59
3.4.2 The Committee on Foreign Investment in the United States 60
3.4.3 The Exon–Florio Amendment to the Defense Production Act 60
3.4.4 The Homeland Security Act of 2002 60
3.4.5 The Foreign Investment and National Security Act of 2007 61
3.4.6 The Foreign Investment Risk Review Modernization Act of 2018 (FIRRMA) 62
3.5 CFIUS Composition and Mandates 64
3.6 CFIUS Review and Investigation 65
3.7 Appealing the CFIUS Review Process 68
3.8 CFIUS Case Study 71
3.8.1 Mamco Manufacturing 71
3.8.2 CNOOC and Unocal 71
3.8.3 The German–US Aixtron Case 75
4 M& A Policies Review Under the Competition Laws in the European Union
4.1 General 79
4.2 EU Core Competition Laws 81
4.3 The Notification Procedure 83
4.3.1 Breach of the Standstill Obligation 85
4.3.2 Exception to the Standstill Obligation 86
4.4 Commission Examination 87
4.4.1 Relevant Geographic Market 87
4.4.2 Countervailing Buyer Power 90
4.4.3 Efficiencies 91
4.4.4 Entry 93
4.4.5 Failing Firm 93
4.5 Vertical and Conglomerate Mergers 94
4.5.1 Vertical Mergers 95
4.5.2 Conglomerate Mergers 95
4.6 Remedies 97
4.7 M& A Review Under National Security Laws in the EU
4.7.1 EUMR Approved Cases Under the National Security Concerns 99
4.7.2 National Security Interests in the UK 101
4.7.2.1 Types of National Interests 102
4.7.2.2 Procedures in National Interests 105
4.7.2.3 Decision of the Secretary of State 105
4.7.3 National Security in Germany 106
4.7.3.1 The Review Process 107
4.7.4 National Security in France 107
4.7.4.1 The Review Process 109
4.7.5 National Security in Italy 109
4.7.5.1 Procedure 109
4.7.5.2 Case Study: 50/50 Joint Venture (H3G) Between CK Hutchison Holdings (a Listed Hong Kong-Based Conglomerate) and VimpelCom Ltd. 110
4.7.6 National Security in the Netherlands 111
4.7.6.1 Procedure 111
4.8 Europe and the UK Case Study: BAE and Finmeccanica 112
5 M& A Policies Review Under the Competition and National Security Laws in China
5.1 General 114
5.2 Anti-competitive Monopoly 115
5.2.1 Exemption to Prohibitions 116
5.3 Abuse of Dominant Position 117
5.3.1 The Chlorpheniramine API Case 118
5.3.2 The Qualcomm Case 122
5.3.3 The Mercedes-Benz and Dongfeng Nissan Case 124
5.4 Concentration of Undertakings 124
5.5 Abuse of Administrative Power to Eliminate or Restrict Competition 126
5.6 Investigation into Suspected Monopolistic Conducts 126
5.7 The Simplified Procedure 128
5.8 Notification Threshold 128
5.9 Gun-Jumping/Failure to Notify 129
5.10 Legal Liabilities 129
5.10.1 General Liabilities 129
5.10.2 Specific Remedies 132
5.11 M& A Review Under the National Security Laws in China
5.11.1 National Security Concept in China 133
5.11.2 The Review Process 136
5.11.3 Blocked Deals in China 138
Part III Global Enforcement and Co-operation 142
6 Extraterritorial Competence of the United States, the EU, and China Competition Laws 143
6.1 General 143
6.2 Extraterritorial Competence of the U.S. Competition Laws 143
6.2.1 The Assertion of U.S. Extraterritorial Effects Over Time 145
6.2.2 U.S. Guidelines Under the U.S. Antitrust Laws 147
6.2.3 U.S. Extraterritorial Cases 151
6.2.3.1 The Ciba-Geigy and Sandoz Case 151
6.2.3.2 The Motorola Mobility LLC Case 152
6.3 Extraterritorial Competence of the EU Competition Laws 152
6.3.1 The Enforcement Tools of Extraterritoriality 154
6.3.2 EU Extraterritorial Cases 154
6.3.2.1 The Chemical Industries Case 154
6.3.2.2 The Wood Pulp Case 155
6.3.2.3 Gencor Ltd. v. Commission 156
6.3.2.4 Boeing McDonnell Douglas 157
6.3.2.5 Google/Motorola 157
6.3.2.6 General Electric/Honeywell 162
6.4 Extraterritorial Competence of China’s AML 165
6.4.1 The Enforcement Tools of Extraterritoriality 166
6.4.2 China Extraterritorial Cases 166
6.4.2.1 The Silvinit/Uralkali Case 166
6.4.2.2 The Savio Macchine Tessili S.P.A Case 168
6.4.2.3 The GE–Shenhua Case 169
6.4.2.4 The Seagate/Samsung Case 171
7 Cooperation Among the Three Jurisdictions 176
7.1 General 176
7.2 Reasons of the Disagreements 177
7.3 International Anti-Trust Cooperation 178
7.3.1 Bilateral Cooperation 178
7.3.2 The Exchange of Information 184
7.3.3 Enforcement of International Comity 185
7.4 The Search for an International Institution 188
7.4.1 The OECD 188
7.4.2 The WTO 188
7.4.3 The UNCTDA 189
7.4.4 The International Competition Network 190
Glossary 191
Bibliography 191
Index 198