Chinese companies are free to acquire counterparts in Switzerland, but China imposes restrictions on its soil. Swiss Economics Minister Johann Schneider-Ammann says he will push for a level playing field during a forthcoming trip to China.
But Schneider-Ammann is more optimistic than other ministerial colleagues that the situation will improve. Last month, Communications Minister Doris Leuthard told the Aargauer Zeitung newspaper that Switzerland should insist on reciprocity, pointing to a tough line taken on the issue in Germany.
“We must do what Germany did many years ago, which is hold a discussion on how to react in the face of Chinese firms’ hunger for takeovers,” she declared. Currently, Chinese rules only allow Swiss firms to have joint ventures with Chinese companies.
Ahead of his visit to China, Schneider-Ammann gave a more placatory message to Swiss public television, SRF, on Wednesday. While acknowledging that the unequal takeover treatment is a real problem, the minister said progress is being made.
“It is my understanding that it is only a matter of time before China must also allow the majority of shares to be given over,” he told SRF. “I am sure that they will get to where we currently are.” For this reason, the level playing field issue will not take a special place in his discussions with the Chinese authorities during his trip.
He also rejected growing parliamentary calls for the creation of a special licensing authority to regulate foreign takeovers. “For me, that would be a step too far. This does not have to be written into law.”
But both Schneider-Ammann and Leuthard agree that companies critical to the daily functioning of Switzerland should continue to have a ‘hands-off’ sign for foreign companies intent on takeover.
Chinese firms have embarked on a spending spree in Switzerland in recent years, snapping up pesticides producer Syngenta and airline support services Swissport and SR Technics among others.
Schneider-Ammann said the markets should be free to decide on mergers and acquisitions. His major concern is how takeovers affect Swiss jobs.
“As long as Syngenta invests in Basel or northwestern Switzerland, as long as innovation, value creation and jobs are secure, it doesn’t matter who the investor is,” he said.