Briefing: China may soon face trouble acquiring German tech firms

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Germany mulls fund to fend off Chinese tech takeovers: source – Reuters

What happened: The German government is looking at changing regulations to limit Chinese acquisitions of the country’s tech companies. It is also seeking to create a fund to rescue firms in financial trouble to ensure that critical technologies are not exported. The changes would include creating a system of government reviews of foreign acquisitions and expanding the types of purchases that would need to be examined.

Why it’s important: China has often been criticized for using its deep pockets to acquire new technologies, rather than developing them itself. Germany isn’s the first company to investigate creating limitations like these. In June, the US Treasury Department began drafting rules that would block firms with at least 25% Chinese ownership from buying US firms that develop “industrially significant technology.” There is an increasing awareness of Chinese companies’ abroad, for reasons including national security, IP protection, and in the case of ZTE, not playing by the rules.