China Esquire

And so this brings me to part 2 of my NERA notes—the part presented by Fei Deng, who talked about the role of nationalism in this deal.  Unfortunately, she decided to start with imperialistic times and talked about things like the Summer Palace, and Chinese humiliation.  Not any of my favorite of topics.

But then she went back to Coke-Huiyuan.  More after the jump.
Apparently 80% of the public opposed the deal.  (Actually, I am surprised it was only 80%–I was expecting something more in the 90s frankly speaking)  And so she said that this was a major motivation in the deal getting killed.

Of course, MOFCOM denied that.  (wouldn’t you?)  MOFCOM said that public opposition wasn’t influential in their decision.  So what did MOFCOM use?  It claimed as part of the basis of its decision Article 27, items 5-6 and Article 28… which is about nationalism.  (surprise surprise)

I’ve already blogged about nationalism, and frankly, it really shouldn’t be surprising for anyone who follows China.  What was surprising is that there are articles in the antitrust law that actually cover this.  That was quite a shock to me.  I am not an antitrust junkie, so just hearing that these provisions existed was an interesting thing to hear.  I guess it could be worse—it didn’t have to be codified at all.  But my question is: how can you really just something that subjective?  It’s really hard to quantify how much MOFCOM can rely on this as a basis for their decision.

Deng presented on other things such as focusing on regionalized, local markets, but frankly, I didn’t find it all that compelling compared to nationalism.

Practitioners, you need to know the Antitrust Law by heart.  I know many of you do, but for those you interested in this area, you have to read it over and over again.  (I confess I haven’t)  How many of you even know about Article 27, items 5-6 and Article 28?  Know it cold.  And know that yes, nationalism will rear its ugly head in–even if MOFCOM doesn’t say it will.

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