New procedures and joint review committee will help facilitate mergers and acquisitions by foreign firms

The news that China will review proposed mergers and acquisitions (M&As) by foreign firms has been a hot topic among foreign media recently. Some view the new security review system as a signal that China is changing its attitude toward foreign capital, while others worry that future deals might be prohibited by the Chinese government on the grounds of safeguarding national security.

However, these media have misread the new security review system, as it is actually aimed at encouraging foreign M&As in China.