CHINA Law and Practice Contributed by: Liu Cheng, Li Yumeng, Ye Hongtao and Jiang Hanxue, King & Wood
The SAMR has imposed such penalties against trans - actions implemented before clearance. For details, see 2.2 Failure to Notify . These penalties are made public by the SAMR. Penalties have been imposed on foreign-to-foreign transactions in recent years. 2.14 Exceptions to Suspensive Effect There are no express provisions within the AML pro - viding for general exceptions to the suspensive effect. In practice, undertakings may inform the SAMR of special circumstances, such as public bids, so as to accelerate the review process. There are no express provisions within the AML pro - viding for a waiver or a derogation from the suspen - sive effect. 2.15 Circumstances Where Implementation Before Clearance Is Permitted Pursuant to Article 26 of the AML, the parties may not close the transaction before clearance. There do not appear to be any circumstances where the SAMR has permitted closing before clearance. It might be possible to carve out certain business in China to implement global closing. However, this would need to be reviewed case by case and would usually require discussions with the authorities. 3. Procedure: Notification to Clearance 3.1 Deadlines for Notification There is no specific notification deadline. However, the parties must not close the proposed transaction before obtaining antitrust clearance in China; other - wise, the parties involved in the proposed transaction will be subject to failure-to-notify penalties under the AML. In practice, the notification is submitted soon after signing the transaction documents. The SAMR reserves power to call in a transaction if such transaction has the effect of eliminating or reduc - ing competition. For below-threshold transactions that are called in by the SAMR after closing, the par -
ties must submit a notification within 120 days upon receipt of the SAMR’s written notice. 3.2 Type of Agreement Required Prior to Notification A binding agreement is normally required for notifica - tion. 3.3 Filing Fees
No filing fees are required for notification. 3.4 Parties Responsible for Filing
As regards merger transactions, all undertakings involved in the merger are obliged to submit a noti - fication. For other transactions, the undertaking that has acquired the control or ability to exercise decisive influence is obliged to submit a notification, and the
other undertakings must co-operate. 3.5 Information Included in a Filing
The information required for a filing mainly consists of the basic information of the parties (eg, name, address, business scope, turnover of the preceding year and shareholding structure), description of the transaction, market definition, competition analysis, market share data of the parties and major competi - tors, etc. The documents required for a filing mainly consist of the notification form (which contains the above-men - tioned required information), transaction documents, business licences of the parties and relevant affiliates, audited financial statements, annual report, power of attorney (if any), supporting documents for the mar - ket share and competition analysis, a truthfulness and accuracy statement, and other documents that may be required by the SAMR. The parties must submit their notification documents and materials in Chinese. If the original documents are written in a foreign language, a Chinese translation (or at least a Chinese summary) must be submitted with the original foreign language version attached. If the parties are foreign undertakings, they must sub - mit an apostilled certificate of incorporation or a cer - tificate of incorporation notarised by the local notary authority and authenticated by the Chinese Embassy.
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