Germany aims to shield tech firms from foreign takeovers

Berlin plans to review or block foreign purchases of stakes as low as 10 per cent in ‘critical technology’ companies

That would cover firms in robotics, artificial intelligence, semiconductors, biotechnology and quantum technology

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The German government announced closer scrutiny of acquisitions by non-EU firms in 2017, which was made in response to the 2016 takeover of industrial robotics firm Kuka by Chinese firm Midea. Photo: Reuters

Published: 4:30am, 29 Nov 2019Updated: 5:34am, 29 Nov 2019

Germany’s economy ministry on Thursday said the country plans to tighten rules on non-EU takeovers of hi-tech companies, against a backdrop of growing alarm about Chinese firms buying up German know-how.

The ministry said it had drafted an amendment to the Foreign Trade Regulation that would allow the government to review or block foreign purchases of stakes as low as 10 per cent in “critical technology” companies.

It would affect firms working in the areas of robotics, artificial intelligence, semiconductors, biotechnology and quantum technology.

“It’s not about banning acquisitions, but about being able to look at them more closely in cases where it concerns critical technologies,” the ministry said in a statement.

During a visit to Berlin in July last year, Prime Minister Li Keqiang, shown here with German Chancellor Angela Merkel, said Chinese firms’ investments do not threaten Germany’s national security. Photo: Reuters

The move goes further than previous efforts by Berlin to protect strategic firms from foreign acquisitions.

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