China's Antitrust Regulator Speeds Up Merger Reviews to Encourage Foreign Investment
SAMR streamlines merger review process as part of broader government effort to revive foreign investment and stimulate economic activity.
Streamlined Review Procedures Under SAMR
China's State Administration for Market Regulation (SAMR) has been streamlining its merger review process throughout 2025, representing a significant shift in the country's approach to antitrust enforcement in the context of cross-border transactions. Under revised procedures, simple cases are now cleared in as few as 15 business days, compared to the previous standard of 30 days. This halving of the review period for straightforward transactions marks a meaningful improvement in regulatory efficiency and sends a clear signal to the international business community that China is seeking to reduce friction in its investment approval processes.
Expanded Simplified Review Categories
The regulator has expanded the categories of transactions eligible for simplified review, broadening the scope of deals that can benefit from the expedited timeline. Transactions where the parties have limited horizontal overlaps, minimal vertical relationships, and market shares below specified thresholds are now more likely to qualify for the fast-track process. These procedural reforms reflect Beijing's recognition that an overly burdensome regulatory environment had been deterring foreign investment at a time when the Chinese economy faces structural headwinds and requires sustained capital inflows to support growth and industrial upgrading.
Recovery in Transaction Volumes
The impact of the streamlined process has been evident in transaction data. The volume of notified transactions increased by approximately 15% in H2 2025 compared to H2 2024, suggesting that the regulatory reforms are contributing to a recovery in deal-making activity. This recovery has been concentrated in sectors that align with China's strategic economic priorities, including electric vehicles (EVs), renewable energy, semiconductors, and advanced manufacturing. Foreign investors in these sectors have found the improved regulatory timeline a positive factor in their investment calculus, particularly when weighed against the broader geopolitical risks associated with investing in China.
Retained Discretionary Authority and Complex Cases
However, the reforms have not eliminated all regulatory uncertainty for foreign investors. SAMR retains broad discretionary authority to block transactions on national security grounds, and the criteria for invoking such authority remain somewhat opaque. Complex cross-border transactions, particularly those involving sensitive technology or sectors with significant state-owned enterprise participation, continue to face lengthier review timelines that can extend well beyond the simplified case periods. Deals that raise competition concerns in concentrated markets or involve parties with significant market positions are also subject to more intensive scrutiny, including potential remedies requirements.
Outlook for Foreign Investment in China
The streamlining of merger reviews forms part of a broader suite of measures that the Chinese government has implemented to revive foreign investment confidence. While the procedural improvements are welcome, experienced deal practitioners recognize that regulatory risk in China extends beyond merger control timelines to encompass data security reviews, technology export controls, and evolving sectoral regulations. A comprehensive regulatory strategy that accounts for all relevant approval pathways remains essential for foreign investors contemplating significant transactions in the Chinese market.
