Politics, not rules, will direct China's dealmaking

Don't read too much into China's formal regulations on M&A. An imminent leadership shuffle is more likely to weigh on dealmaking, at least for now.

After nine months of baring its teeth at “irrational” foreign investments, the Chinese government has formalised guidelines to list types of overseas dealmaking it will encourage, limit and prohibit.

China’s State Council announced late on Friday it had approved a “further” set of guidelines see table below from National Development and Reform Commission NDRC, Ministry of Commerce Mofcom, People’s Bank of China PBoC and Ministry of Foreign Affairs MoFA on overseas investments.

It confirmed what has been apparent from months of leaked unofficial memos, government announcements and state media reports circulating among the financial community, some of which saw...

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