China says concerned over tighter German curbs on takeovers

FILE PHOTO - A man walks past the Chinese and German national flags before a meeting of officials between the respective trade and economy ministries in Beijing, China, November 1, 2016. REUTERS/Thomas Peter

BEIJING (Reuters) - China expressed concern on Friday after Germany became the first European Union country to tighten its rules on foreign corporate takeovers, following a series of Chinese deals giving access to Western technology and expertise.

The new regulations will allow the German government to block takeovers if there is a risk of critical technology being lost abroad. They will take effect shortly with no need for parliamentary approval in a bid to protect critical infrastructure, including power grids and hospitals.

The move reflects pressure across Europe to limit takeovers by Chinese state-backed groups of prized European assets.

“We are concerned about the relevant moves of Germany and Europe,” Chinese Foreign Ministry spokesman Geng Shuang told a daily news briefing.

China’s trade and business links with Germany and the European Union have brought real benefits to the peoples and companies of both sides and promoted economic growth, he added.

China hopes that Germany and the EU can avoided being affected by protectionist tendencies, and not send a “confused, negative” message to the rest of the world, Geng said.

The purchase last year of German robotics maker Kuka KU2G.DE by Chinese company Midea 000333.SZ raised concern that China was gaining too much access to key technologies while shielding its own companies from foreign takeovers.

State-owned ChemChina’s $43 billion purchase of Swiss pesticides and seeds group Syngenta, China’s biggest overseas acquisition to date, has increased pressure in Europe to curb foreign takeovers in strategically important sectors.

Reporting by Ben Blanchard; Editing by Robert Birsel